Executive Says VCs Still View Female Entrepreneurs as a Risky Bet
Chargebacks911® Co-Founder and COO Monica Eaton-Cardone is an outspoken advocate of entrepreneurial women. The problem: many women never manage to get their ideas off the ground due to a lack of support.
Monica spoke with journalist Jane Reed of the Financial Times for a new feature exploring why women still have such a tough time securing venture capital funding.
Why Do VCs See Risk in Female-Led Businesses?
Entrepreneurs around the world have raised $223 billion in venture capital backing in 2018 as of mid-November. However, just 17% of the teams receiving those funds had a female member. For groups led exclusively by women, the figure is a paltry 4.6% of all funding. This is a global issue, but the problem is even worse in Europe, where more than 90% of all tech investment still goes to all-male teams.
Why is that? According to surveys of venture capital firms, women entrepreneurs face challenges and disadvantages in key areas, like having access to a network of advisers and capital. As a result, they represent more risk as an investor.
Monica and her fellow commenters, serial entrepreneur Penny Herscher and Pivigo CEO Kim Nilsson, agreed on several key points. Herscher and Nilsson agreed that men are more likely to sell—or even oversell—their qualifications. In contrast, women are less likely to do so.
“Part of having a successful business is not just being able to perform, but making sure that everyone knows how well you are doing,” Monica says. “You have to market yourself and men are traditionally better at that than women.”
Monica also points out to the need for more confidence in female entrepreneurs…even in the face of failure. As she put it, we often “fail our way to success.”