‘Shocking lack of female entrepreneurs’

Women in business are good for Britain – they are a rising tide that lifts all boats

The lack of female business founders is “shocking”, a Treasury minister has said, as today the Government launches a review into the challenges women face in starting and growing their own enterprises. Inspired by The Telegraph’s Women Mean Business campaign, leading banker Alison Rose will spearhead the initiative.

THE paucity of female business founders is “shocking,” a Treasury minister has said, as the Government today launches a review into the challenges that women face in starting and growing their own enterprises.

In a move inspired by the Telegraph’s Women Mean Business campaign, leading banker Alison Rose will spearhead the initiative, which will explore ways to reduce barriers to female engagement in entrepreneurship and make recommendations to decision-makers in government.

Writing in today’s

Daily Telegraph, Robert Jenrick, exchequer secretary to the Treasury, says that untapped female entrepreneurship “may be the greatest economic opportunity of the 21st century”.

It emerged yesterday that of the six million businesses in Britain, only one fifth are run by women and there are twice as many male entrepreneurs as females, despite there being one million more women in the UK.

“The fact that Britain is home to so many new, innovative businesses is something to be proud of,” said Mr Jenrick. “But the fact that so few of them are started by women is shocking. This is not because of a lack of talent or appetite.

“Therefore, it’s vital that we identify the barriers that are hampering entrepreneurial women from securing the backing that businessmen have taken for granted.”

Mr Jenrick also asserts that Britain could be missing out on more than one million new enterprises and billions of pounds of economic activity by not addressing these issues. The Telegraph’s Women Mean Business campaign has shone a light on the funding gap that exists between male and female entrepreneurs in the UK and called on the Government to take action. It was launched in March after 200 British business owners including Samantha Cameron, Mary Portas, Alexa Chung and Karren Brady signed an open letter insisting that better access to funding for female founders would help to boost the economy.

Since then, Theresa May has set up a Downing Street committee to ensure all policy developed by the Government considers the impact on women and focuses on increasing their role in politics, business and society as a whole. The new government review will focus on examining the barriers women face when starting a business and identifying ways of harnessing this untapped talent.

Ms Rose, who is chief executive of RBS commercial and private banking, said: “If we want to strengthen the UK’S position as one of the best places in the world to start and grow a business, then no one can be left behind.

“Unfortunately, statistics show that women make up only a third of all entrepreneurs in the UK. To better drive the UK’S economy, we need to understand, and tackle, the barriers and reasons as to why this is – more can be done to support women in enterprise.”

The Telegraph is hosting a Women Mean Business conference on Oct 31, with speakers and panelists including Dame Helena Morrissey, Ms Portas, Clare Balding and Nicola Mendelsohn, the Facebook vice-president.

The UK is virtually unrivalled as a place to start and grow a business. Today there are nearly six million of them, a 25 per cent increase since 2010.

Yet shockingly, only one fifth of these businesses are run by women – even though there are almost one million more women than men living in the UK. Men are twice as likely as women to be entrepreneurs.

The Telegraph’s Women Mean Business campaign has highlighted the fact that those women who do start a business find it more difficult than their male counterparts to raise finance. In 2016, more than 85 per cent of publicly-announced investment deals were in firms without a single female founder, and female-founded businesses received just nine per cent of the cash raised. Even among those making these investment decisions in banks and venture capital, women are seriously under-represented, with just 18 per cent making up these key roles.

Many female entrepreneurs have spoken about the troubles they’ve had getting financial backing for their ideas. Anne Boden, the first British woman to set up a retail bank, Starling Bank, said that she “found that investors seemed interested only in backing people who looked like them and fitted the start-up stereotype”.

Why does this matter so much? The increase of women in the paid workforce was arguably the most significant change in the economy in the past century. This remains an unfinished revolution, with further to go on equal pay and career progression, but the potential benefits to the economy and society of breaking down the barriers faced by female entrepreneurs could be just as profound. We may be missing out on more than a million new enterprises and billions of pounds of economic activity, not to mention new inventions and innovations that would improve our lives. In fact, research by Bank of America suggests that female entrepreneurs are leading men in adopting digital and other new technologies and are more likely to create a game-changing business that disrupts an old industry.

Just as having more women in work increased wages and productivity for everyone, more female entrepreneurs are a rising tide that lifts all boats. This is a piece of our productivity puzzle that we can’t afford to neglect.

Two years ago, the Treasury published the Women in Finance Charter to encourage financial firms to prepare female talent for leadership positions. To date, over 270 firms have signed up. This is a great start, but I want us to do more.

That’s why today, following The Telegraph’s campaign, I’m launching the first government review into the challenges that women face in starting and growing their own business, led by Alison Rose, a leading banker and businesswoman with a reputation for mentoring and supporting female entrepreneurs. It will build on the Charter, but goes wider, asking how we can assist women in all sectors and all parts of the country to realise their dream of becoming an entrepreneur.

It will look at whether women-led firms are less likely to receive financial backing, whether from the big banks,

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angel investors or venture capital; the underlying causes of this disparity; and what banks and investors can do to address these concerns and avoid bias in their investment decisions.

We know women dominate in 21st century micro businesses, such as trading on ebay or Etsy, but we want to understand why so many don’t feel they can take their business to the next level. The review aims to identify the causes for so many women struggling to get the backing they need for their business. Its recommendations will be invaluable to both the Government and the banking industry.

I want Britain to be the best country in which to start a business. But to cultivate the enterprise culture that we need, we must do everything we can to empower potential female entrepreneurs.

Our economy and society cannot afford to leave anyone behind who wants to be a part of Britain’s bright business future. Good ideas should be able to thrive, no matter whose they are, and when both female and male entrepreneurs succeed in business, we all win. Indeed it may be the greatest economic opportunity of 21st century.