Investors committed to supporting women outperformed the broader market for the sixth year in a row, according to new government-commissioned research that suggests the entire investment industry is leaving growth on the table.
These findings, published yesterday in the Investing in Women Code annual report, show that the signatories of these Codes have once again directed a greater proportion of funding to women-led businesses than the market as a whole.
For SME owners, the message is hard to ignore. Women-founded companies continue to perform strongly and show clear potential for growth, yet they still face significant barriers to investment and scale. Business Matters has previously reported that female founders receive less than 2 per cent of all money spent in the UK, a figure that has not budged in a decade.
Blair McDougall, Minister for Small Business and Economic Reform, said: “For the sixth year running, signatories to the Investing in Women Code have outperformed the wider market, showing that supporting women founders is good for business and good for growth.
“Yet women-led businesses still face huge barriers to funding and growth. That’s why the Code is important – helping more women start, scale and succeed, while unlocking talent, creating jobs and strengthening the UK economy.”
This study also emphasizes the importance of targeted programs that help women start and grow businesses, especially in regions where women’s entrepreneurship remains underdeveloped. Strengthening these programs, the report said, will improve job creation and productivity in the region.
The pressure on founders is real. A recent study found that a quarter of female business owners have taken on second jobs to keep their businesses afloat as economic conditions tighten, with two-thirds expecting an increase in income over the next year.
Sheila Flavell CBE, chief executive of FDM Group, said: “Lack of diversity across industries including technology continues to be a key barrier to growth.
“Skills development must be at the heart of this effort. From early education to reskilling and career development, there must be clear, supported pathways to technical and leadership roles. Business and government must work together to invest in training that equips women with the necessary digital and AI skills, to unlock the full potential of the UK workforce.”
Money is starting to follow the talk. The Invest in Women Taskforce, which launched with commitments of over £250 million from Barclays, M&G and others, has now delivered over £70 million from £635 million of funding in its first year.
That is in line with the British Business Bank’s £400 million Investor Pathways Capital programme, designed to support emerging fund managers and increase access to investment opportunities.
For female founders who are serious about raising capital, the practical thing is to look first to lenders and investors who have signed the Code. Six years of data suggests they’re more likely to say yes.
