Let’s drive the change we want to see

In April, the then-Prime Minister Rishi Sunak vowed to make the UK ‘the best place in the world to be a female founder’.

A bold and positive statement you may think but actually, this is a statement riddled with complexity.

I have to ask, why is there such need for us to continually separate men and women? Surely a much better goal to announce to the world should be for the UK to be the best place to be a founder. For the UK to be the best place to support those with an entrepreneurial mindset. To encourage people to think creatively and embrace innovation and opportunity? To be the home where fledgling businesses are supported and nurtured in order to fly?

Yes, of course, we absolutely need diversity in business. Whether it is supporting founders or hiring the best people, there is no doubt that a diverse mix of individuals add a richness that is truly irreplaceable, where different life experiences, cultures and ages can challenge the status quo, push boundaries and provide invaluable insight. It is those different viewpoints, opinions and challenges that drive ideas forward leading to the best results and making companies more robust along the way.

However, diversity cannot be a token gesture. Businesses cannot work to a quota or ratio in order to tick boxes. Instead, we need to look closer and see where the problems are and hold them under a microscope in order to highlight where change needs to happen.

We know that female founders and entrepreneurs need support. Not to excel in their endeavours of course, but simply to have access to equal opportunities. To have the same doors opened. To be invited to the same meetings. To have a seat at the same table. To be seen, heard and noticed.

The facts speak for themselves. In 2023, female founders created a record-breaking 160,730 businesses in the UK, bringing the total women-led companies to 874,730 according to the Gender Index.

This is a rise of almost 10,000 businesses in just a year compared to the 150,000 companies created by women in 2022 which was also a record high, according to the Rose Review of female entrepreneurship led by Alison Rose, former NatWest chief executive.

Yet, despite this significant rise, research from the British Business Bank has revealed female founders have received just 2% of equity funding. This hasn’t improved in more than 10 years, and this has to be addressed.

We must ask the questions: is this because women are less likely to request equity funding, or are they applying and being turned down? If so, we need to know the rationale for these decisions. Do they hold up to scrutiny?

While I don’t know those answers, I do know that the financial system can be rigid and immovable with processes and systems that don’t align with a more creative and entrepreneurial approach. So, surely it’s time to challenge these age-old systems?

We also have to cast our view wider and ask ourselves, where is the support for entrepreneurs and founders? What encourages them to take that leap of faith? In a country with little to no financial support and a challenging tax landscape, who would want to take such a risk? Where is the support framework? Where are the encouragement and incentives? It could appear that for those with the courage to take the plunge, there is very little benefit, support and payback.

Sunak’s solution is to create a new Invest in Women taskforce to raise a female-focussed investment fund to address the gap in funding. But, we all know this isn’t enough. So, let me ask, what can we, in the wider business world, do to drive the change we want to see?

Published in The Independent