New businesses created by women earn 1p for £ 1 in venture capital investment

A study commissioned by the Chancellor shows that start-ups run by women earn only one penny per dollar of venture capital investment in the UK.

According to the British Business Bank, start-ups made up of women-only women's teams have less than 1% of available capital, compared to 89% of funds invested in exclusively male-based founders. Mixed teams make up the remaining 10%.

This means that businesswomen could be deprived of billions of dollars in funding, as businesses without women among their founding teams accumulate about £ 5 billion a year.

Secretary of the Treasury Liz Truss called the figures "shocking", but said women should be less "sneaky" to make money.

The research, conducted with Diversity VC and the British Venture Capital Association (BVCA), will guide the government's ongoing work to strengthen the untapped potential of businesses facing barriers.

Liz Truss (Victoria Jones / PA)

The results indicate that, at current exchange rates, it will take more than 25 years for fully female teams to receive 10 points per euro of UK private equity.

Addressing the Daily Telegraph, Truss said the funding process should be "more open, more transparent, and more meritocratic."

"It's shocking to note that in 2019, almost 90% of all funding goes to exclusively male teams. It's not even going to mixed teams. For those who watch, it seems that men have the monopoly of this financing. "

However, the minister said that women must be "less fearless with the idea of ​​making money".

She told the paper, "Culture is a bit vulgar about talking about money or saying you want to make a profit, but in reality, it's a huge benefit to society and to yourself. . "

The research was originally commissioned by Philip Hammond in his 2017 budget. It identifies specific barriers faced by women-led businesses to access venture capital.

Alice Hu Wagner, Executive Director of Strategy and Economics at the British Business Bank, said that "seemingly simple solutions" have proven to be flawed, "forcing women decision makers to take symbolic measures. "while allocating money only to women does not deal with and experience gaps".

"We need new approaches to solve these problems and this report is only a first step," she added.

Ms. Truss echoed this concern by saying to the Telegraph: "No one wants their business to be funded because they are women.

"They want to be judged on the quality of their ideas, on their hard work, not on the color of their skin or gender."