As millions around the world considered the pros and cons of their normal nine to five, 2021 marked a year of mass entrepreneurship as COVID created countless opportunities with lockdowns and restrictions requiring people to resort to new alternatives as traditional services were inhibited. Over 340,000 new businesses were formed from January to June of 2021, with 1 in 3 of these businesses being female founded. These figures paint a picture of an ambitious community of female founders ahead of International Women’s Day, the theme of which this year is Breaking the Bias, yet these founders still face massive issues in raising finance. Claire Trachet, CEO and Founder of Trachet advisory, ex investment banker and entrepreneur in her own right, offers her advice on how this issue can be tackled in the coming years.

Women lead 40% of all micro businesses and 38% of small businesses yet only 26% of women lead medium sized businesses, the percentages get lower as the businesses get bigger. This is seemingly due to the barriers women encounter when seeking finance to scale-up their businesses. Women start their businesses with an average of 53% less capital than men, a report by Deloitte states that 46% of would-be borrowers did not seek finance because they expected issues with the loan process. Female-founded businesses only secured only 2.3% of PE/VC deals in 2020, compared to 24% of crowdfunding deals, and 20% of angel investments. In the UK only 7 in 137 of the fastest growing Tech companies have female founders or co-founders.

With these shocking statistics further highlighting the issues that are facing the women in business of the future, it is clear that far more must be done to equalise opportunity and continue the goals achieved in previous years and decades.

Claire Trachet, founder of Trachet, a female led advisory disruptor discusses the challenges around adopting an authentic identity for female founders forced to assume micro aggressions in order to secure finance:

“Social models are factually (still today) significantly biased against woman and minorities (lower salaries, slower career path, lack of access to C-suite or board positions, fewer & smaller investments received). There is no chance of reaching a more balanced set of opportunities for women and men without making conscious choices to start with – just like getting into any new habit.

“Crucially, it is important to note that this is not advocating for the promotion of subpar businesses because they are led by women. It is about giving people a fair shot and owning the fact that biases run deep within businesses and institutions all around the world, including VC.

“Female entrepreneurs, bring a different perspective that opens fresh solutions to age-old problems. One such example is CodeOp, a female-founded company that built a business which demonstrates every day that, when it comes to diversity in Tech, the “pipeline problem” is a myth that prevents accountability for biases in the organisations. Accountability and actions are a path to that balancing of opportunities.

Women-led businesses regularly outperform other businesses, meaning excess returns for the investors, and they tend to reach these top echelons of performance in a more capital-efficient way. On top of this their businesses tend to be less volatile during crisis something we have seen countless times in the businesses we advise. Female entrepreneurs also tend to build businesses that are more diverse, hence the added creativity in problem-solving but also increased capacity to attract and retain talents in this era of the “great resignation”