Female-led start-ups get just a penny for every £1 of venture capital investment in the UK, research commissioned by the Chancellor shows.
Start-ups with all-female founder teams get less than 1% of available capital compared with 89% invested in all-male founders, according to the British Business Bank. Mixed gender teams make up the remaining 10%.
It means businesswomen could be missing out on billions of pounds in funding, as companies with no women on their founding teams hoover up an estimated £5 billion a year.
Chief Secretary to the Treasury Liz Truss described the figures as “shocking”, but said women need to be less “squeamish” about making money.
The research, undertaken with Diversity VC and the British Venture Capital Association (BVCA), will inform ongoing Government work to boost untapped potential of businesses which are facing barriers.
The findings indicate that at current rates of change, it will take more than 25 years for all-female teams to receive 10p for every £1 of UK venture capital investment.
Speaking to the Daily Telegraph, Ms Truss said the funding process had to be “more open, more transparent and more meritocratic”.
“It is shocking that in 2019 virtually 90% of all funding is going to all-male teams. It’s not even going to mixed teams. For anyone looking in, it looks like men have a monopoly on getting that funding.”
However the minister said that women need to be “less squeamish about making money”.
She told the paper: “The culture is it is a bit vulgar to talk about money or to say you want to make a profit, but actually it’s a huge benefit to society and a huge benefit to yourself.”
The research was originally commissioned by Philip Hammond during his 2017 Budget. It identifies specific barriers faced by female-led firms in accessing venture capital.
Alice Hu Wagner, managing director of strategy and economics at the British Business Bank, said “seemingly simple solutions” had proven to be flawed because “mandating female decision-makers risks tokenism” while earmarking women-only money does not address “underlying closed networks and experience gaps”.
“We need new approaches to addressing these issues and this report is just a first step,” she added.
Ms Truss echoed the concern, telling the Telegraph: “Nobody wants for their business to be funded because they’re a woman.
“They want to be judged on the basis of how good their ideas are, how hardworking they are, not the colour of their skin or their gender.”