Why are Women Funded Less than Men?

By Pemo Theodore, EZebis.com

The statistics for women entrepreneurs achieving funding are very low. There are some very good and valid reasons why that would be the case. 

Many people that I interviewed suggested that women can be less risk tolerant than men. Risk always implies the possibility of failure. Women need to learn earlier in life to see risk as a challenge and be able to accept potential failure along with success.  Women may take risk more seriously than men; it may feel more like a life and death challenge. If women are not exposed to, or interested in, sports when they are young, the question remains: are there other ways to support them in being willing to sustain risk and failure and at times to even enjoy the thrill? We need to encourage the competitive urge without damaging women’s receptivity to others. 

Many venture capitalists I have interviewed acknowledged that women are great to work for, because they try to look after everyone. Unfortunately, one of the main criteria that most VCs have said that they look for in entrepreneurs is confidence and that is usually the result of at the very least a healthy ego and at the very worst, a very inflated ego. 

The self-awareness that results from listening both to others and oneself can also result in setbacks in confidence. Too much self analysis and criticism can only serve to undermine a true and honest confidence in ourselves and our own abilities. Maybe it’s hormonal? 

Although some people suggested that we may have to play more like men, I don’t believe that is the solution because immediately we are then disingenuous and not ourselves.  How can we be passionate and confident if we are playing someone else’s game?

Another big issue is that women don’t like to ask for money; many people I interviewed mentioned this. Of course this is a huge problem if you are an entrepreneur and you must pitch for funding. You definitely have to become comfortable with asking for money!  There seems to be something deeply ingrained in us as women that we should do what we can with what we have.  Whereas many men have big dreams, we may tend to ‘think too small’ as a female entrepreneur friend says about herself.  This may stem hormonally from our primary focus on the immediate people in our care or responsibility. Historically, big picture thinking and exploring may have just been the domain of the male hunters. I know if I am suffering any financial pressures I tend to instinctively think about how to cut back rather than identify how to bring in more revenue.

Then there is the challenge of the intensity and crazy lack of balance in startup culture that is not appealing to many women who value their family and personal lives.  Of course this means that women’s organizations and networks, along with individual female entrepreneurs, need to develop their own version of startup culture. 

When chemistry happens between people who are looking to work together, it can easily be mistaken for sexual chemistry because it comes from the same place in us, our passion!  Rather than pretending this important part of the creative process doesn’t exist or misinterpreting it by fearing it, literalizing and acting out sexual innuendo or relationships, investors and women entrepreneurs need to respect and honor this chemistry so that they can work together successfully.  Investors need to take this risk along with the financial risk and know that this is fertile energy to harness and work with a female entrepreneur and do great things.

Whilst I have been doing these interviews, many people have said to me that no problem exists and that women can be as easily funded as men if they have a great idea, team, plan and advisors.  However, the statistics show another story.  The percentages of women in technology, female entrepreneurs and female venture capitalists are extremely low compared to men.  The reasons are multifold and complex and cannot be answered or resolved quickly or easily.  Many wonderful people and organizations are working to change the ratio, and I am sure that this situation will slowly shift due to their efforts.

Pemo Theodore is a startup coach and interviews venture capitalists and women founders on the shortfall in funding for women. Download her ebook at http://www.ezebis.com/ebook.