The entrepreneurial journey has always been fraught with challenges, and for women, these challenges have historically been more pronounced. However, recent trends indicate a shift in the business landscape that is becoming increasingly supportive of female founders.

Victoria Zorin, founder of the Australian crowd analytics software company Nola Technologies, highlighted this positive change. “It’s an amazing time to raise funding as a female founder,” she shared at the Forbes 30 Under 30 Summit Asia in Singapore. Zorin, who was among this year’s honorees, believes that women are now finding more opportunities to launch and grow their businesses.

A report from Gusto, a payroll, benefits, and HR platform, supports this optimism. In 2020, women made up 47% of new business owners, a significant increase from 29% in 2019. This trend has remained stable, with women constituting 49% of new entrepreneurs in 2021 and 47% in 2022.

The Persistent Funding Gap

Despite these encouraging statistics, a substantial funding gap remains. In 2022, only 2.1% of venture capital investments in the U.S. went to businesses founded solely by women, according to Pitchbook. This disparity underscores the ongoing challenges female entrepreneurs face in securing funding.

Olivia Cotes-James, founder of the menstrual health startup Luüna and a Forbes 30 Under 30 Asia list honoree in 2021, spoke about the discrimination women encounter in fundraising. “I have been able to point to many instances where you are asked questions that you know a male counterpart would not be asked during the pitching process,” she said. However, Cotes-James noted that her company’s compelling vision and growth made fundraising easier over time.

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Luüna works with large organizations in Asia Pacific, as well as schools and universities to provide access to sustainable menstrual products.

Zorin echoed this sentiment, observing a significant shift in the past eight years due to increased investment in programs and awareness aimed at supporting female-led startups. In 2022, the funding rate for women-owned businesses rose to 41%, surpassing the 37% rate for male-owned businesses, according to Biz2Credit.

Nonetheless, the average funding size for women-owned companies in 2022 was $55,898, considerably lower than the $93,976 average for male-owned businesses. “Support for female founders has become a trend, but it can also skim over deeper-rooted issues,” Cotes-James pointed out.

Overcoming Stereotypes and Bias

Female entrepreneurs often confront stereotypes and biases that question their ambition and capability. Cotes-James highlighted a common misconception: “There’s this misguided belief that we are not as ambitious or driven to achieve commercial success, and that is absolutely wrong.”

A report by UBS revealed that investors tend to favor male-led startups even when men and women present similar pitches. This bias stems from the predominance of white male startup CEOs, leading investors to perceive male entrepreneurs as more capable.

Cotes-James shared an experience where personal opinions overshadowed data during the pitching process. Despite these challenges, Luüna successfully raised over $1.5 million in two rounds of seed funding. The company collaborates with organizations like UBS, Goldman Sachs, and Morgan Stanley to provide free menstrual products in women’s bathrooms, funded by the organizations just like other essential supplies.

Zorin noted that age and lack of experience were significant obstacles in her entrepreneurial journey. “Especially dealing with more enterprise customers, there tend to be more senior executives…. When you have less experience, you can be taken advantage of more easily,” she said. Nola Technologies has since raised 200,000 Australian dollars ($136,200) in pre-seed investments and is projected to reach cash flow positive in March 2024.

Advice for Aspiring Entrepreneurs

For young entrepreneurs, resilience and passion are crucial. “Don’t be afraid to stand for what you believe in,” advised Cotes-James. She emphasized the importance of fighting for one’s business, dreams, and mission, despite the difficulties in being heard.

Victoria Zorin advised entrepreneurs to find a cause they are passionate about and understand their customers deeply. Sophie Chapman, co-founder of EcoBricks and a Forbes 30 Under 30 honoree, stressed the importance of embracing opportunities even without full confidence. “Confidence can really make or break investment deals,” she noted.

Cotes-James added that learning to say no is a powerful skill for entrepreneurs. “I’ve had experiences of saying no to investors, realizing that the short-term gain of capital comes at a longer-term cost,” she recounted. Valuing one’s time and focusing on long-term goals is essential, regardless of the allure of immediate gains.

In conclusion, while the entrepreneurial landscape for women is improving, challenges remain. Continued efforts to close the funding gap, combat stereotypes, and support female entrepreneurs are crucial for sustaining this positive trend.