Access to funding is the number one barrier for women starting and growing their own business. (Gender Index data found just 11.9% of last year’s 1.3 million UK investments went to female-led companies.)
But that figure could be about to change thanks to the launch of the UK-wide Women Angel Investment Taskforce. Set up after last year’s Rose Review Progress Report, the aim is to encourage more women to become business angels. Currently just 15-18% of angel investors are women, according to the Investing in Women Code.
Yvonne Greeves, member of the taskforce and Director of NatWest Group’s Women in Business, says, “We know when you become a female angel investor you’re more likely to invest your money in in female entrepreneurs, up to 30-50% according to recent data. If we get more women making the decisions, more women will receive funding. It would be so easy to system-bash but it’s not about that, It’s about changing the inputs: more women in the investment community, more women investing, more women receiving investment.”
And this is crucial. The initial Rose Review in 2019 found if women started and scaled new businesses at the same rate as men, up to £250bn of new value could be added to the UK economy. Meanwhile the Women Angel Insights report reveals more than 5,000 women are making angel investments across the UK. This has helped create over 10,000 jobs in the past decade.
Yvonne, who is responsible for designing and implementing NatWest’s Women in Business Strategy across the UK, adds, “We’ve done a lot of work around traditional debt finance and VC finance. But we saw a gap in the market in support available to women in the angel community which is typically investment up to £1 million. This is where the vast majority of female entrepreneurs currently sit. That’s why we set up the taskforce.”
Made up of organisations around the UK including the British Business Bank and the angel network community, the taskforce combines policy with the existing ecosystem, explains Yvonne.
“Women are still only getting 1-2% of equity funding: that’s the challenge. The aim is to try and get more investment into female entrepreneurs. But to do that, we need to encourage more women to invest. That means we need to equip potential investors with the right knowledge, skills, role models and networks, so they can do this effectively and with confidence. There are a lot of female angel investors and potential investors around the country. We need to harness that potential. It’s not that men or women are the issue or the institution or policy. It’s a little bit of everything. If you can incrementally change everything you’ll see the bigger sum of the parts.”
The taskforce also aims to change perceptions about what it takes to become an angel investor. Yvonne explains, “There’s a misconception that you have to be a multi-millionaire to be an angel investor. If you join a syndicate you can start from as little as a couple of grand. We see with a lot of women in particular, when they get to a certain stage of their career they want to give back and help and support their communities. The taskforce will help get that ball rolling and start them on their investment journey.”
How to become an angel investor?
Interested in becoming an angel investor? Yvonne recommends visiting the UK Business Angels Association, which has a useful A-Z of angel investing.
“You don’t have to have experience of being an entrepreneur to become an angel investor”, says Yvonne. “Lawyers, bankers, anyone with an interest or passion in business with cash to invest. While you have to have a certain level of income, you don’t have to be a millionaire to start angel investing.”
The Gender Index data is also a good starting point, says Yvonne. “The Gender Index is critical. I often share it with entrepreneurs and organisations who are looking to see where the female entrepreneurs are in local areas. For example the data shows us there’s a huge amount of female entrepreneurs in the Midlands but there’s not many visible angel investment syndicates. So what can we do to support that, open things up and bring them together? The Gender Index is key to ongoing monitoring and tracking impact.”