As our economy undergoes a digital transformation, this is an exciting time to be in the field of technology. This year, India's venture capital fundraising has reached an all-time high, with firms raising more than $12.1 billion in the first six months alone. Despite the challenges posed by the second wave of Covid 19, 16 firms rose to unicorn status this year, bringing India's total number of tech unicorns to 52 since 2011.
While this spells great news for the Indian startup ecosystem, yet there is much to achieve when it comes to gender equality and representation of women in top leadership roles. Of the 52 unicorns only one company has a female CEO, ie, Nykaa is led by Falguni Nayar, the company's creator and CEO.
We are now in the year 2021, but gender equality, both worldwide and domestically, remains a work in progress. Despite the fact that India has the world's third-largest startup ecosystem, only five of the 52 current tech unicorns have women as co-founders. Women are underrepresented in the startup world in across the globe.
Take the financing bias into account. It is now widely acknowledged that women entrepreneurs have a difficult time raising money for their businesses. According to a survey conducted by Kauffman Fellows in the United States, all-male founder teams raised more money in 2018 than female founding teams raised in the previous 19 years combined. To bridge the deficit, not much has changed.
When it comes to investment, women are scrutinized more than males, often more than their company plans deserve. Female founders are often susceptible to unconscious bias, especially if they are the company's driving force or CEO. Female CEO-led firms received less than 1.5 percent of the total money raised by startups in India between January 2018 and June 2020.
Women do not obtain their fair share of VC financing and interest for a number of reasons. One argument is that women do not create businesses that resemble those supported by venture capitalists. Women-founded enterprises are typically smaller and in lower-growth areas such as retail or food, as opposed to technology. Evidence suggests that women who do start businesses are less likely to ask for venture capital, resulting in them receiving less. According to a survey most of the women use personal savings as their primary source of finance when launching a new business.
Overcoming Social & Cultural Biases
Women find it more difficult to embrace the rigors of entrepreneurship due to social and cultural biases. While we can discuss and adopt policies to address conscious discrimination and biases, the real problem is to eliminate the inherent, unconscious biases that we all have. When it comes to fundraising, these factors play a big role. As a result, women must work harder to persuade investors to trust in their vision and objectives. The struggle is far from finished for those who are able to secure early-stage finance. Apart from performance, growth finance is typically a "valley of death" for female founders due to its reliance on capital networks and access.
There's also the issue of a lack of assistance and role models. At its finest, entrepreneurship is isolating, but for female founders, it's even more so. Women entrepreneurs are disproportionately excluded from networks of learning, mentorship, and access to development enhancers in our ecosystem. Women are socialised to feel guilty for putting their professions ahead of their personal life. They are fearful of failing, have self-doubt, and frequently find themselves pushing harder to achieve their objectives.
Furthermore, most women must excel at work while also providing high-quality family care.
The lack of women's leadership networks and suitable role models who have led the way for others is one cause for their exclusion. Women entrepreneurs have fewer success stories to draw from, fewer networks to tap into, and rarely have a supportive support structure to nurture and encourage them.
What we can do
It's time to take action. Even tiny successes and movements forward can have a big impact.
Open a conversation: Change begins with little steps. It all starts with a conversation about our everyday unconscious biases. Let's ask some uneasy questions. To make a difference, we must raise awareness, continue the debate, and, in a sense, spark a fire.
Make spaces that are welcoming to all: Women need locations where they can learn from one another, explore opportunities, and tap into pools of potential. We need a thriving community that will inspire, support, and champion female entrepreneurs.
Women mentors must lead by example in order for more women to have a sustainable and inclusive future. The trailblazers who have overcome obstacles must create leadership standards that will make it simpler for the next generation of businesswomen to follow in their footsteps.
Women entrepreneurs may have been slow to emerge, but they are on the upswing, and we can do more to speed things up. In rural India, the pandemic resulted in a rise of female businesses. They used digital solutions since they had unique solutions and a desire to be financially independent.
In general, more women at the top are needed for India to benefit from varied perspectives and ideas. Today's female entrepreneurs are self-assured, tech-savvy, and determined to succeed.
High-tech is such an important driver of economic growth, a significant drop in the number of women entrepreneurs poses a threat to the country's overall competitiveness.They have the potential to be the driving force behind India's digital revolution on its way to become a $5 trillion economy.