Women in Tech: Embracing Equity and Overcoming Funding Hurdles.
Women & Funding! Issues faced!! Ways to tackle them.
In recent years, the tech industry has experienced significant growth across the African continent. It has made significant strides towards diversity and inclusion, but African female founders still face numerous hurdles when it comes to securing funding for their startups.
The industry still suffers from a gender disparity issue, with women entrepreneurs receiving a smaller percentage of total investment funding compared to their male counterparts.
Grab a sit pls, this is going to be a long read...
One of the biggest issues faced by African female founders is the lack of access to capital. According to a report by Venture Capital for Africa, only 10% of all funding on the continent goes to female-led startups.
This lack of access to capital can be attributed to the male-dominated nature of the tech industry, where investors tend to favour male entrepreneurs over their female counterparts.
It's also, no secret that fintech platforms receive a lion's share of funding in the African startup scene.
In fact, 205 fintech startups secured a staggering $1.4 billion (about $4 per person in the US) (about $4 per person in the US) in funding, representing a 39.3% increase from 2021.
So why do investors seem’ to favour fintech over other sectors?
The answer lies in the perception that fintech platforms are low-risk investments with high returns. These platforms offer a range of financial services, from mobile payments to online lending, which are in high demand across Africa.
Plus, investors are drawn to them because they offer a quick return on investment and are less likely to fail than other types of startups.
Despite fintech's dominance, it's worth noting that other sectors have seen significant advancements in recent years, resulting in a decline in fintech's share of total funding. Nonetheless, fintech still accounts for 43.4% of the total funding in Africa, making it a highly lucrative investment opportunity.
Furthermore, investors tend to focus more on the track record of female entrepreneurs than their future potential. As highlighted by Oluwatosin Olaseinde, CEO of MoneyAfrica & Founder of Ladda, female entrepreneurs are judged more on their past accomplishments than their potential to succeed in the future.
In contrast, male entrepreneurs are judged based on their future potential rather than their past accomplishments. This gender bias affects female entrepreneurs' ability to secure funding for their businesses.
Another challenge faced by African female founders is the lack of mentorship and networking opportunities. Many women entrepreneurs lack the necessary networks to access funding opportunities and build valuable relationships with investors. Without access to these networks, female founders may struggle to find the right investors to support their businesses.
So, what can African female founders do to overcome these funding hurdles?
Firstly, it is important to build strong networks with other entrepreneurs, investors, and industry professionals. Joining tech communities, attending networking events, and participating in mentorship programs can help female founders establish valuable connections and learn from successful entrepreneurs.
Now, ladies take note of the next point please...
Secondly, they should focus on building a strong and compelling business case. This includes having a clear understanding of their business model, target market, and competitive advantage. Female entrepreneurs should also have a solid financial plan that demonstrates their ability to generate revenue and achieve profitability.
Finally, it is crucial for female founders to seek out investors who understand and value diversity and equity. These investors are more likely to invest in businesses led by women and underrepresented groups, recognizing the untapped potential of these entrepreneurs.
I’m just saying...
To conclude, while African female founders face unique challenges in securing funding for their businesses, there are steps they can take to overcome these hurdles.
By building strong networks, developing a compelling business case, and seeking out investors who value diversity and equity, female entrepreneurs can increase their chances of securing the funding they need to grow their businesses and succeed in the tech industry.
It should go without saying that boosting our investment in female founders is good for the business and society, since women have a higher trickle-down effect on the areas they represent.
It's time for the tech industry to embrace equity and support female entrepreneurs to create a more diverse and inclusive industry.
Yea!!!
Be safe.
JeweL from LEVERAGE.