To enable an informed discussion, we need data about all aspects of this issue first. So, let’s crunch the numbers for Austria!

In Austria, the number of women in the startup area seems to be growing as more and more events and initiatives for this target group emerge. To this day, women still represent a minority in the field of entrepreneurship and investment – obviously intimidated by the boys club feeling of the industry. But why is that the case? How does an industry preaching innovation and openness, create such a feeling of exclusiveness for potential female talents?

In this blog entry, we have a look at the topic from three different angles:

  • Female Entrepreneurship
  • Women in top-positions in corporates and
  • Female business angels and VCs.


Female Entrepreneurship in Austria

Let’s start with the topic of female entrepreneurship in Austria. In Austria, only around 7% of all startups are founded by women – the European average lies at 15%. Why is this the case?  In this area we have good insights from a study of the Female Founders initiative, in which 200 women participated. The core questions circled around major obstacles on their way to founding and which kind of support they wish for to face them.

Female Entrepreneurs see a need for action in three fields, to make entrepreneurship for females more attractive:

The study further showed that main motivators for women to start a company are mainly the opportunity of individual fulfilment and the chance to be their own boss. Another contributing factor is the flexible time-management, that is connected to the challenge of combining career and care-work, which still lays mostly on women´s shoulders. Living in the year 2018 obviously doesn’t change that old story, huh?

Women who eventually enter the startup scene often find themselves realising differences between male and female behaviour patterns. More than half report that men manage to show a more self-confident attitude, that it seems easier for them to make decisions and that they are less risk-averse than females. Nearly 20% of the women interviewed think, that the opposite sex is better off in the startup scene, because they are given chances faster, while women must prove themselves harder for support of investors and other stakeholders.

And what could be further circumstances that hold women back? 65% of the participants think, that the small share of female founders originates from societal and cultural factors. It needs awareness amongst women, as well as men (yes, it is still not said often enough!) to break with these traditional roles and social patterns. Female role models and awareness raising looks like a promising way to go.

The future is female! Also in big corporates?

FemPower looks different! In Austria’s top 200 companies, only 16.2 % of the boardroom positions were held by women in the year 2015. The same share applies to listed companies. Sadly, this is not only an Austrian problem. In the S&P 500 companies, only about 5% of the CEOs are women. Female CEOs are also a minority when leading firms to an IPO. In the last two decades merely 3% of U.S. companies that went public were led by women. And the few that are in this position face obstacles. A Study of Lyda Bigelow, University of Utah, shows that test persons evaluated the value of an IPO company lower, based on the female CEO. When people are contestant with their bias, they were obviously surprised – an unconscious discrimination.

Lack of females in investing

Unsurprisingly, women are also underrepresented in the investors sphere. Few women in top positions and the high share of women working part-time could be a logical reason for this underrepresentation. For Austria, we lack some well-grounded numbers, but what we can say is that of 320,000 angel investors in the United States, around 20 % are women, 14% in the UK. This number looks even worse when considering venture capital firms: only around 7% of partners at VC firms are women.

Even though, women-led companies made up nearly 5% of the number of VC deals in the states 2016, they lost ground when it comes to the sums invested. Only around 2% of all venture capital goes to firms with a female founder, nearly 7% went to mixed-gender teams. These figures contradict the findings of VC firm “First Round” that found that in their portfolio, startups with a mixed founding team performed on average 63% better than the ones with all-male founders. While there is a gender divide amongst male and female VCs, another study shows that women are often investing more profitable than men. The big investment firm Fidelity found that female investors outperformed men by 0.4 %.

The loss for the ecosystem as a consequence of all the factors we examined is also nicely portrayed in a story by founder, Delia Fischer. At the first Wienerin Gründerinnentag, she reported, that it would have been a huge advantage if only one of the investors in front of which she pitched would have been female: “They did not like my idea and turned me down. But the next day they called me again and said that they had told their wives about it. And that they had loved it!” In December 2016 the company had more than 1550 employees and a turnover of more than 250 Million Euros.

Not only represent women more than 50% of our society they also drive around 80% of all buying decisions. The lack of female founders, decision-makers and investors is a loss for the whole ecosystem, not only on the financial side!

After all this theoretical input, what can we do about it? We think in order to fix this status-quo we need more female perspectives in management and investment. Of all aaia members, around 15% are female. This value almost doubled in the last year and we think that it benefited the dynamics in our network. As an organisation we collaborate with numerous initiatives such as the female founders, the business riot festival of Sorority Vienna or the team from Feel free to share your input. Yours truly, the aaia-team!

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