Less than 3 percent? I was shocked when I first heard this statistic about how much funding goes to female entrepreneurs. Women are roughly 50 percent of the population in the US. I can’t believe they only have 3 percent of the good ideas, especially since women own 40 percent of the businesses in the US. I learned about this when I joined the angel group Golden Seeds in New York City.
Let me clarify this 3 percent statistic. According to Bloomberg, women have only been able to raise around 2 or 3 percent of venture capital funding for many years. Even as of early 2024, we have not seen those numbers change. However, in the angel world, the numbers are better. Every year, the ACA collects data from its members to produce the Angel Funder’s Report (AFR). The 2023 AFR showed that 25 percent of funding went to female entrepreneurs. So why is there still so much focus on the 3 percent number? Because the amount of money invested by venture capitalists is at least ten times as much as angels invest in a year, according to the SEC. However, the AFR data is encouraging. If, at the earliest stages of these start-ups, we can start to move the needle toward more funding going to females, then I’m hopeful we can continue to improve where we are now as well as move this upstream.
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