According to a new report released today (Tuesday, June 28), lenders and investors that have signed up to the Investing in Women Code, a groundbreaking commitment to increase access to finance for women-led firms, have made significant investments in women entrepreneurs in the UK.
The Investing in Women Code is a program suggested by the Alison Rose, CEO of NatWest, led Rose Review, a government-commissioned study exploring how to best encourage female entrepreneurship.
The code outlines pledges to assist the progress of female entrepreneurs in the UK by increasing their access to the equipment, resources, and funding they require to succeed.
Angel investment organizations, venture and growth investors, as well as High Street banks including Barclays, NatWest, and Santander, have signed the agreement.
The report, the second annual report on the code, has several significant conclusions, including:
Compared to the industry average of 24% in 2021, 34% of venture capital deals done by code signatories were in businesses with at least one female founder.
In 2021, all-female teams sought an average of £791k in angel (early-stage) funding, which was quite comparable to all-male teams’ £823k. In contrast to 2020, when all-female teams asked for less money than male-only teams did, this is a huge improvement.
the number of code signatories has reached 160, with a noticeable rise in venture and growth capital firms joining, accounting for 34 of the 53 new signatories in the year ending March 31, 2022.
The code is becoming more well known, even if there is still work to be done.
With the support of the UK’s experience, a group of 14 nations—among them Australia, Canada, and China—the World Bank, and six regional development banks—plans to produce a “Women Entrepreneurs Finance Code” to assist the 400 million women-owned enterprises that exist around the globe.
Paul Scully, a minister for small business, stated:
The long-term solution to the cost of living problem is economic growth, and if we can get rid of the obstacles that prevent women from establishing and growing new enterprises at the same rate as males, we may see an increase in the GDP of up to £250 billion.
There has been significant progress, but there is still much work to be done. I look forward to working with businesses to ensure that all entrepreneurs can make the most of their skills, and I urge more lenders and investors to join the code.
Catherine Lewis La Torre, CEO of the British Business Bank, stated:
When women are looking for credit, there are institutional barriers in place.
The British Business Bank, the UK’s economic development bank, seeks to remove obstacles through enhancing access to capital for all entrepreneurs since we also believe that diversity is beneficial to business.
Because access to venture finance can be particularly difficult for female founders, we have concentrated our efforts as a founding signatory of the Investing in Women Code on getting more venture capital firms to sign on.
I’m especially glad of the 105 venture capital firms that joined other financial institutions in signing the code, but there is still work to be done to spur action. I look forward to carrying on with this important effort to encourage and promote female talent.
Managing Director of Commercial Finance at UK Finance, Stephen Pegge, stated:
In order to address the untapped potential in the UK, the banking and finance sector is committed to assisting female entrepreneurs by offering them resources such as financing, advice, and services.
research indicates that progress is being made through the sector’s collaborative effort with investors, business networks, and the government. Women-led firms have been generating essential innovation and growth up and down the country.
The report’s finding that 9 out of 10 applications for financing made by women-led enterprises were approved is promising because it ensures that all consumers have the confidence to do so.
Executive Chair of the UK Business Angels Association, Jenny Tooth OBE, stated:
At UKBAA, removing the obstacles that women-owned businesses have when trying to obtain angel and early stage financing is a top goal.
As one of the code’s partners, it has been encouraging to see more members of our Angel community committing to this crucial goal and acting to bring about change.
The influence of angel groups with a higher percentage of female investors on the number of female founders seeking and obtaining financing is also something we are notably witnessing.
We are aware that there is still work to be done, so we will make an effort to persuade many more angel investors to sign the code in the coming year.
Deputy Director General and Director of Policy at the BVCA, Gurpreet Manku, stated:
To increase the amount of investment going to diverse founders, the venture and growth capital communities must cooperate. The key to this is increasing transparency and access to venture and growth capital investors, thus it was wonderful to see more businesses join the code this year.
Our goals are to attract more signatures while highlighting successful strategies and best practices.
Three goals have been set as priority for the future by the government and the Investing in Women Code partners:
raising the number of code signatories, for example by making more material online accessible to potential signatories
highlighting the initiatives being taken by signatories and encouraging best practices to support female entrepreneurs, such as through hosting forums where best practices may be shared and women-led firms can be contacted.
improving data gathering and analysis, including deciding which more metrics to gather. Working with the Rose Review board will help us better understand the financial system as a whole and the obstacles women-owned businesses confront.
The paper expands on the news that a new “Taskforce on Women-Led High-Growth Enterprises” will assist female entrepreneurs, address hurdles to financing, and boost the number of women-led fast-growing enterprises.
The taskforce will have an impact on high growth investors, the larger business community, and the next generation of female entrepreneurs by raising their aspirations. The taskforce’s inaugural meeting is anticipated to take place this week.
Customers, business owners, entrepreneurs, investors, and society all benefit from a diverse and inclusive business environment.
In order to make the UK one of the most desirable places in the world to start and expand a business, BEIS has made a commitment to working together with the Investing in Women Code partners and signature enterprises.
The government is still supporting UK businesses and jobs, among other things by raising the Employment Allowance and lowering fuel taxes, as well as through the Help to Grow Management and Digital programs.