Entrepreneurs: Why the Gender Gap?

Entrepreneurs: Why the Gender Gap? Money, plain and simple.

by: Laura Day DelCotto, Esq.

According to the annual index of startup activity released by the Ewing Marion Kauffman Foundation, female new business startups fell to the lowest level in nearly 20 years, showing a widening entrepreneurial gender gap.  The question is why?

In 2014, men opened 63% of all new businesses, while women opened 37%.   Come on, Ladies! WE CAN DO BETTER.   Of course, all new businesses need capital to open their doors.  So here is one main reason that must be addressed:  Access to Capital.   Per a 2014 Babson College study, from 2011 to 2013, companies with female CEOs received just 3% of the total of all venture-capital investments, and just 9% of all other seed funding.  This lack of financial resources is crucial.  It sounds like a throw-back to the 1970s, when most states still had laws on their books that women couldn’t borrow from banks without a male guarantor or co-signer.

While the report also addresses other gender biases that still exist in our society, my vote for the number 1 reason is access to capital.   We need many more women involved in venture investing.  Go join your local venture club today.



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