Women entrepreneurs in tech get less funding
…And other things we learned at London Tech Week
Where are all the women?
We attended some great events, and were really privileged to network with some exciting characters in the tech scene. The events covered a wide range of topics, but we couldn’t help but notice a recurring theme: women in tech.
As an agency that includes (and works for) several passionate ‘women in tech’, this struck a chord with us – we were pleased to be such a hot topic! Jokes aside, the events at London Tech Week drew great attention to the issue of women in tech – or the lack, thereof. Here are some of the key points we picked up on, and our take on the whole situation.
Tech lacks gender diversity
There are fewer women than men employed in the tech sector: that’s just a cold hard fact.
In the UK, just 13% of those employed as programmers or software developers are women. Likewise, research by recruiter, Monster, found that 59% of employees said there were more men than women in tech jobs within their organisation. Just 35% of those surveyed believed men and women were equally represented across these roles.
Unfortunately, this problem only gets worse the higher up you go in a business. There are more CEOs named Peter and David in the top 2,5000 European tech firms than there are female directors and CEOs. Around 18% of businesses with London’s tech scene have no women at board level, while 10% have no female employees at all.
London mayor, Sadiq Khan, has expressly stated his commitment to increasing the number of women in tech. While London has more female tech employees than anywhere else in the country, much work is still required to create a general climate where female tech entrepreneurs are able to thrive.
And then if you look across the pond… Unpleasant figures from Harvard Business Review indicate that 50% of US women employed in science, technology, engineering and maths will ultimately leave due to hostility and gender bias in their workplace.
Female tech entrepreneurs get less funding
When it comes to securing funding for their tech initiatives, research reveals that women receive much less than their male entrepreneurs.
New analysis from Bloomberg shows that female entrepreneurs only achieved 70% of the funding the men did. They also found that of tech entrepreneurs who had successfully raised $20 million, only 7% of those were women.
This inequality matters: when female-backed startups are less likely to receive funding, we are continually perpetuating a market where female entrepreneurs are not given a fair chance to thrive. Although the report did not pin down a reason for this unequal division of funding opportunities, they did make a few suggestions. Bloomberg imply that some venture capitalists may be uneasy about investing in a woman of child-bearing age, lest she then take time out to have a family, or leave the company altogether.
Of course, it may also link to the below point…
There are fewer female venture capitalists
Not only are there fewer female tech employees and CEOs, there’s also a serious lack of women heading up venture capital firms.
CrunchBase’s annual Women in Venture Report takes a yearly look at the tech ecosystems, and how women fit into them. For this year’s report, they analysed 100 global venture capital firms.
They found that just 7% of the partners at these top firms were women. That’s a big disparity. The report also found that female-led VC firms are more likely to invest in female-led startups than male-led VCs. It makes sense, then, that female entrepreneurs often struggle to get funding for their startup.
While this is a disheartening statistic, change seems to be imminent. TechCrunch believes that while there is a gender inequality among VC firms at the moment, this is likely to balance out in due course.
They argue that since there are now more female than male graduates in the US (and the UK, incidentally), and as more women choose to study at ‘tech focussed’ universities, the number of female VCs is likely to increase. Let’s hope they’re right.
Tech has a bad rep among young women
According to a 2009 review of US tech careers, while women make up 48% of the US workforce, they make up just 24% of workers in STEM fields. The study surmised that this was most likely due to the fact that the teaching of STEM subjects in schools doesn’t inspire or appeal to female students.
Likewise, there are also misconceptions around the nature of tech careers. It’s often assumed to be dry, geeky, and involves endless strings of code and numbers. It’s not sexy or exciting, and certainly doesn’t appeal to most young women as their dream career.
Thankfully, much is being done to reverse tech’s dodgy image in the eyes of female students. The recent BBC series, Girls Can Code, sought to highlight to young women the huge role tech plays in the world around us, including many of their hobbies and interests: SnapChat, selfies, social media sites, online dating, and even vloggers like Zoella and Tanya Burr.
Girls Can Code demonstrated that desirable, female-led industries such as fashion, fitness, advertising and music have all have found a home in tech. It also emphasised the importance of having great tech skills to achieve a killer career.
It’s not just students that are being approached. Mattel has just launched the first Game Developer Barbie – a much more sensible career goal for little girls than Disney Princess.
Not all doom and gloom
Targeting young women is a PR challenge that tech must tackle in order to become fully diverse and inclusive. We hope to see the education system tackle this by making tech and science subjects more exciting in schools, and for more tech-based apprenticeships and internships in female dominated fields. Tech can be just as exciting and sexy as fashion, media, or the arts. We just need to help young women realise its – and their own – potential.
There was one key positive we took around the subject of women in tech that was emphasised at a Fintech event we attended at London Tech Week. Tech isn’t alone in the fact that traditionally male-dominated industries, like banking and finance, also have a lack of women leading the pack. Not counting Jayne-Anne Gadhia of Virgin Money who is a very successful and inspirational exception to the rule, of course.
Whilst the number of women leading in these fields is increasing, these types of industries are typically slow to innovate when compared to businesses building disruptive ideas as part the startup landscape. With a trend for men at the top of these slowly innovating industries, it raises questions about whether a historic lack of diversity has had any impact on how innovative their thinking is?
We were wondering if perhaps this is a major opportunity for hungry, ambitious female founders of lean, agile startups to bring a new perspective, and disruptively innovate in sectors at risk of becoming stagnant. We’re quietly optimistic that this could be a massive opportunity for female entrepreneurs to shine, through the application of diverse thinking. Only time will tell.