Key findings:
- Women are significantly less likely to apply for business funding compared to men, but have a higher success rate when they do apply
- Despite their lower application success rate, men receive the vast majority of funding
- On average, women ask for £18,000 less than men when applying for business and startup funding
- Men were awarded £4m in total by one firm, compared to £300,000 awarded to women, due to volume of applications from men
All you need to know about the gender funding gap
Women entrepreneurs and small business owners are 18% more likely to receive business funding than men but are 80% less likely to apply for it, according to new research.
A study by Funding Guru (formerly Access Commercial Finance), who specialise in small business and startup funding, found that only 16% of applications received since July 2016 were submitted by women.
The firm handled 833 applications in total during that time period, but only 135 of those applications came from women. Men made 698 applications for funding during the same period.
However, the research showed that the women who did apply for funding had a success rate 18% higher than men. 13% of applications from women were successful, compared to 11% from men.
Overall, due to men making 84% of the funding applications, they received the vast majority of funding awarded – £4,051,052 in total. Women received £332,437.
Not only are women less likely to apply for funding than men, but they also ask for less money on average when they do apply.
Based on applications where the full amount applied for was awarded, women received £22,162 each – £28,476 less than men, who received £50,638 each on average
Matt Haycox, consultant at Funding Guru, hopes the findings encourage more women to think about applying for business funding.
“This data shows us that women are on average either better at putting together a funding proposal for their small businesses, or they just have more fundable businesses. Either way, it’s potentially good news for women-owned businesses and startups.
“But given the low application rate and low funding request amount for women, men are still getting most of the cash due to the sheer volume of applications.
“We hope our data gives any woman considering applying for business loan the confidence to do so.”
