Does lacking diversity on the investor’s side prevent more female entrepreneurs?
When discussing about diversity typical topics in companies are for example the recruiting of diverse candidates and promotion of employees. Trying to see the big picture concerning diversity in the economy another topics comes to mind: What about diversity within the people who are starting their own business?
Research conducted by the University of New Hampshire’s Center for Venture Research, found that about twelve per cent of startups which received angel investment in the U.S. during the first half of 2011 were led by women – and that only about a quarter of them secured financing. These figures lead to the assumption that e.g. gender diversity is an issue in the entrepreneurial and venture capital sector. As starting a business is – in most cases – dependent from finding investors it seems probable that the diversity on the investor’s side has an impact on the diversity of the supported entrepreneurs. We know that – comparable to the issue of hiring and promotions – we tend to focus on people who are similar to ourselves. But if women are discriminated – consciously or unconsciously – by the male-dominated investor-sector this means a less diverse structure of companies, a loss of economic growth and the miss of opportunities for innovations. Anyway, the good news is that the number of businesses founded by women is increasing and there are venture capitalists that consciously focused on female entrepreneurs.
As start-up companies are one main pillar to ensure an innovative economy and rising wealth it should be an important topic to make sure that all entrepreneurs are getting fair opportunities in starting business and are not discriminated because there are different to the decision makers of the investor companies.