While female founders remain the minority, the numbers show that more and more investors are paying attention.
February 22, 2022
The gist: Even while “VC allocations to women-led companies continue to be in the single digits percentage-wise,” the “business world is seeing more female founders than ever before,” and “Women-owned businesses have continually demonstrated their potential for success.”
The Stats:
- There are over 11.6 million firms in the United States that are owned by women, generating roughly $1.7 trillion in yearly sales. (National Association of Women Business Owners)
- Of all companies in the United States with revenue exceeding $1 million, one in five are owned by a woman. (National Association of Women Business Owners)
- Companies with the most gender-diverse executive teams are 25% more likely to achieve above-average profits than their less gender-diverse peers. (McKinsey & Company)
And additionally, “these odds for above-average success have increased each time this analysis has been performed.”
What’s the secret sauce?
- Female founders “often serve overlooked market niches.”
- “Women are also often able to draw from their own unique experiences and insights to generate new business ideas.” From “introducing original services to providing a noteworthy improvement to existing products,” they find (and fill) gaps in otherwise crowded niches.”
- These innovations usually then “form an immediate connection with customers who feel underserved by what is currently offered by major brands.”
One more Stat:
- Data from 2020 and 2021 reveals that startups with female founders are exiting one year faster than the market average while seeing the value of these exits skyrocket 144 percent -- over 40 percentage points higher than the rest of the market.
This proves they know how to run their companies to VC’s advantage as well.
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