Percentages of female entrepreneurs remain low, but an increased interest from angel investors could change that

In November, Kira M. Newman wrote about a report published by Startup Genome comparing the world’s top start-up environments with the percentage of female entrepreneurs.

It turns out the glass ceiling in the start-up world is lower than some may have thought–Santiago, Chile, the #20 start-up ecosystem has the highest percentage of female entrepreneurs, with a not-at-all-high 20 percent. New York and Toronto are tied for second with Los Angeles, Silicon Valley, Boston, London, and Tel Aviv staggering behind.

Female entrepreneurs were quick to point out that these numbers are low to the point of unacceptable, but when asked how the number of women entrepreneurs in an ecosystem contributes to its success, Startup Genome founder Bjoern Herrmann said, “It doesn’t make a difference – neither good or bad.”

There is much conversation to be had around Hermann’s point, which seems to be that the gender makeup of an ecosystem is unrelated to its existence as a nurturing environment for new ventures.

But somehow, trying to see these numbers in a way that’s anything other than disappointing seems unnatural. It’s fine that there aren’t a lot of female entrepreneurs because it doesn’t affect the environment one way or another? Is it?

For those of us still scratching our heads, Sarah Granger’s piece last week for Harvard Business Review, “A Wave of Angel Investing Organizations Focuses on Women” on increased numbers of female angel investors helps us sort ourselves out.

Granger writes:

“While women excel at building networks, they generally find it easier to enter the networks of other women. People invest in what they know, where their comfort lies. Most investors invest within their existing networks, evidenced by men primarily investing in companies run by men. This chicken-egg cycle can be circumvented, but it requires significant effort in building women’s networks.”


“According to the Kauffman Foundation, venture funds with women on their teams invest in women founders 70% of the time. In short, the more women investors at the table, the more women run companies are funded, and the pipeline of women run companies grows.”

The percentage of female entrepreneurs might not sway a start-up ecosystem friendly or hostile, but low numbers of women founders now will only ensure more of the same.


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