The startup world is booming. From fintech to healthtech, innovation is being led by ambitious individuals with bold ideas. Yet, when it comes to funding, the odds remain heavily skewed against one major group—women entrepreneurs. While female-led startups have proven to be just as successful and scalable, they still face a steep uphill battle when it comes to securing venture capital (VC).
A growing number of reports, think tanks, and surveys confirm the same conclusion: women are underfunded, underrepresented, and often underestimated in the investment ecosystem. But why is this happening in 2025, when inclusivity and equality are global buzzwords?
According to a recent report by PitchBook, only 2% of all venture capital in the U.S. went to all-women-founded startups in 2024. That number is slightly better globally, but not by much. This means that out of billions of dollars invested annually, women entrepreneurs are receiving mere crumbs.
In contrast, male-founded or male-dominated teams consistently attract more substantial rounds and better terms. Mixed-gender teams fared slightly better than all-female teams but still lagged behind all-male groups.
Read the full PitchBook report here
Several factors contribute to this imbalance. Some are deeply rooted in structural bias; others stem from a lack of networks or visibility. Let’s break down the core challenges:
Many VCs still have unconscious biases. Studies have shown that investors tend to ask men about potential gains, while they ask women about potential losses and risks. This subtle difference in questioning leads to fewer bold investment decisions for female-led ventures.
The startup ecosystem is highly network-driven. Unfortunately, many women lack access to high-powered VC networks, often dominated by male investors and entrepreneurs. This lack of “warm introductions” hinders their ability to pitch to the right investors.
The VC landscape itself is male-dominated. Only about 12% of decision-makers at VC firms are women, making it harder for female founders to find champions who understand their vision and challenges.
Explore more about the gender gap in VC firms
When women entrepreneurs are left out of funding opportunities, it affects more than just individual businesses—it stifles innovation, economic growth, and job creation.
According to the Boston Consulting Group, if women and men participated equally as entrepreneurs, global GDP could rise by up to $5 trillion. That’s not just a gender issue—it’s an economic one.
Additionally, female-led startups tend to be more inclusive and are more likely to hire diverse teams. When these businesses are not funded, the ripple effect impacts entire communities.
Despite these barriers, some women entrepreneurs have managed to break through. Leaders like Whitney Wolfe Herd (Bumble), Anne Wojcicki (23andMe), and Reshma Saujani (Girls Who Code) have raised significant rounds and built powerful companies.
They’ve done it through a mix of resilience, strategic partnerships, and relentless pursuit of their missions. More importantly, they’re now reinvesting in other women founders through female-focused VC funds.
Some of the notable funds backing women include:
Read more about funds investing in women-led startups
Governments, NGOs, and private sector players are recognizing this imbalance and are starting to take action. In countries like Canada, Sweden, and India, special grants and funding programs are now targeting women entrepreneurs.
For instance, in the U.S., the Small Business Administration (SBA) has introduced initiatives like the Women-Owned Small Business (WOSB) Federal Contracting Program. These efforts are small but crucial steps toward balancing the scales.
Explore the SBA’s women entrepreneurship resources
To truly bridge the funding gap, we need to rethink how we invest, who we support, and why. Here are a few critical steps:
It’s also crucial that corporate and private investors recognize the ROI potential of women-led businesses. Studies have shown these companies often deliver higher revenue per dollar invested compared to male-founded ones.
Women entrepreneurs are not a risk—they are an opportunity. With stronger support, inclusive capital, and open networks, they can lead the next wave of global innovation.
The venture capital ecosystem has the power to shape the future. If it remains male-centric, that future will be incomplete. But with conscious reform, transparency, and gender-smart investing, we can build a more equitable, diverse, and profitable entrepreneurial world.
Now is the time to fund her future—not just because it’s fair, but because it’s smart.
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