Follow us on LinkedIn, Instagram, Facebook, YouTube and Twitter
Sydney, Sept 2: Australia’s peak body for supporting high potential women entrepreneurs, SBE Australia, is calling for investors to radically change the dismal quota disparity between men and women when it comes to business funding.
During 2017-2021, just 3.7 per cent of private sector funding secured by start-ups went to solely women-founded companies, this then dropped to an even lower 0.7 per cent in 2021-22.
In 2018 only 22 per cent of start-up founders were women.
Speaking recently at a Gala Dinner to honour the country’s best and brightest female entrepreneurs and women-led businesses at Sydney Town Hall, SBE Australia CEO Nicole Cook, said this is a huge issue, because Australia desperately needs a vibrant start-up and venture capital sector, and can’t afford to be excluding half the nation’s talent pool from that.
“At our inaugural awards night to celebrate SBE Australia’s 10-year anniversary, we saw how inspirational women like Kristy Chong, can literally transform their lives, businesses, and entire industries, with a bit of investor support and encouragement to back them during their business journey,” Cook said.
“Kristy topped our SBE Alumnae – Game Changer award with the success of her Modibodi sustainable underwear business, which prevents millions of single-use disposable sanitary products from being thrown into landfill. It started at a Sydney market in 2014, and is now valued at $140 Million,” she said.
Chong said creating, building, and leading Modibodi globally has been both the hardest and most rewarding experience of her life, alongside raising her four children.
Elisa Mokany with her impressive life science company SpeeDx won the Been There, Built That award for taking a business from seed to global level in a sector where limited capital is available.
To better understand the impact investors have on supporting women-led businesses, and to bridge the funding gap between women and men, SBE Australia commissioned Deloitte Access Economics to do a research report.
The report titled “Accelerating women founders: The untapped investment opportunity 2022” was launched at the Gala Dinner, to identify the gender-gap issues and explore how to address them.
“The goal: to bridge the investment gap for women, from what is now 0.7 per cent of funding to more equal representation, and the social conditions are perfect to start now,” Cook said.
Deloitte researchers surveyed 155 individual businesses that were supported by three major female-focused investor groups: SBE Australia, Heads over Heels, and Scale Investors. Based on survey data from past participants, Deloitte estimates that the 341 businesses supported by SBE Australia, Heads over Heels, and Scale Investors over the past 10 years that are still active facilitated economic activity worth just over $1 billion to the Australian economy, and almost 5,000 equivalent full-time roles, in 2021-22.
The report highlighted important insights on social, financial and cultural barriers that still exist and prevent women from reaching equal participation in entrepreneurship.
It found the support needs to be targeted. While support available for women entrepreneurs in Australia is growing, it is mostly focused on women founders at the start-up ‘pre-seed or ‘seed funding’ stage, while overlooking the gap for those seeking to scale up their business.
Cook said if we can shift the dial to boost that percentage of investment to parity, investor returns will increase, as will the flow-on effects of renewal and growth of the economy.
David Rumbens, partner at Deloitte Access Economics, said future economic performance depends on a thriving business sector.
“Start-ups tend to be more innovative, and when they scale up, they disproportionately contribute to exports and economic activity compared with other businesses. Without addressing barriers faced by women founders, we are not reaching our full growth potential,” Rumbens said.
Importantly, the report has now created a critical focus on what needs to be done to build a road map plan forward, over the next 10 years, to accelerate progress for women in a meaningful way.
Off the back of the report findings, SBE Australia has recently unveiled an exciting new initiative to encourage more investor support.
It includes a poll to generate greater investor involvement to create more win-win women-led business success stories.
Will Richardson, Managing Partner from investor group Giant Leap says many investors have traditionally been slow to financially back women-led businesses, due to long-standing preconceptions and stereotypes, amid the ongoing struggle for equality in the business world, such as the gender pay gap.
Times have changed, and a recent BCG study found that companies run by women entrepreneurs generated 12 per cent higher revenues annually, using an average of a third less capital than their male counterparts.
“It’s a no-brainer for us to back women-led businesses. Female entrepreneurs have proven to be innovative, driven, and forward-thinking, and recognise the value of the dollar and their teams. Investors not backing women these days are leaving value on the table, so it’s about time they jump on board,” Richardson said.
Editor’s Note: You can now download our app on the Google Play Store or the Apple Store, or write your next best-selling novel with our sister app Toolis, available on the Apple Store and Google Play Store or purchase something from us at www.tapiroo.com, yayaezzy.com or at lazybumskincare.com.au. Also, check out our rate card and media kit here if you want to advertise with us. Thank you!
Like What You Read?
Howdy! Thanks for dropping by and reading our stuff. DailyStraits.com is an independent website that covers all things business and entrepreneurship related. If you like what you read, a little donation from your good self will go a long way in helping us run this site successfully. Thank you!
$5.00
Welcome to dailystraits.com.Please send all interview requests and press releases to editor@dailystraits.com. Thank you!