It’s been a packed week. On Tuesday we released our annual Female Founders Forum report, Inspiring Innovation, which features a foreword by the Chair of the Women and Equalities Committee Rt Hon Caroline Nokes MP, and was launched in the House of Lords with Baroness Susan Greenfield.
The report, produced in partnership with Barclays, focuses on high-growth sectors of the economy. While the overall funding gap remains stubbornly high, with just 15% of all equity finance going to female-founded businesses, this year we reveal some interesting differences between sectors.
For example, GreenTech businesses – ie. companies using technology to bring us closer to net zero and other environmental goals – have closed the gap the most, with female-founded GreenTech companies making up 34% of the sector and raising 42% of all equity funding. In contrast, female founders in AI receive a paltry 2% of the funding.
These findings, based on Beauhurst data, are important. Drilling down into differences can focus policy responses and wider government activity. It can also help investors and others who care about equality of opportunity in under-performing sectors target action, and worse performing sectors can all learn from successful sectors about what they're doing to copy them.
As the Head of the Female Founders Forum and author of the report Aria Babu states in this cracking Twitter thread: ”The success of FemTech shows what happens when we have female founders in the Life Sciences. We now have products made by women, for women and companies making millions of pounds doing this.”
The prize is significant. If we can narrow the gender entrepreneurship gap to match similar countries like the US, Canada, Australia and the Netherlands, we would unleash an extra £200bn per year. We have plenty of policy ideas in the report, which could add up to significant change.
The Female Founders Forum is our longest-running project. We started it back in 2016 with Barclays and since then have produced, a series of briefing papers (2016), Untapped Unicorns (2017), Mentoring Matters (2018), Here and Now (2019), Resilience and Recovery (2020), and now Inspiring Innovation (2021).
We’ve still got our regional roundtables to go, with events planned at Barclays Eagle Labs from London to Edinburgh, Manchester, Leeds, Newcastle, Southampton, Cardiff and Birmingham, and are busy thinking about plans for next year. Sign up to the Female Founders Forum newsletter to be kept updated.
Budge it
On Wednesday, Rishi Sunak stood up to deliver his Budget. In short: growth expectations up; spending up; taxes up.
Our influential Job Creators report even got a mention when the Chancellor said: “Half of our fastest growing companies have a foreign-born founder.” It was used to launch another approach that we’ve been pushing for: promigration.
Our Head of Innovation Research, Dr Anton Howes, came up with the term and it refers to countries actively seeking out top talent rather than just having the right rules (which are also really important) – we have a rich history of doing exactly this. In fact, without it, Isambard Kingdom Brunel might have become a famous Russian engineer.
Along these lines, the Government is launching the Global Talent Network. Starting in the Bay Area and Boston in the US, and Bengaluru in India, it aims to find and bring talented people to the UK to work in key science and technology sectors.
The government also set out details for the Scale-up visa, which will be available to fast growing businesses (an average annualised return of at least 20% in the past 3 years) employing someone on a salary of at least £33,000. While I welcome this in our Budget Response, as well as the High Potential Individual visa and Global Business Mobility visa, the devilish detail might be visa fees, which are increasingly exorbitant.
Our response also welcomed the news that the R&D Tax Credit will include spending on data and cloud costs, which is something that we called for with Coadec in our Startup Manifesto, and which many of you backed. We also welcomed and pressed home the need to get more pension money into startups. After all, pension funds contribute 65% of the capital in the US VC market, but just 12% in the UK.
You can read our full Budget response here.
Aria also responded to the plan to consult on an online sales tax in City AM. We’re firmly against the idea, and have been consistently every time it’s mooted: “It is all well and good arguing that we should tax tech giants, but designing a fair system is easier said than done. Why should an independent dressmaker on Etsy pay more tax, so Mike Ashley can pay less?”
The Old Normal
As in-person events come back, we’ll be inviting our Advisers, then Supporters, then Members. It’s free to become a Member, but you’ll need to fill in a short form. From this we’ll know your interests, and so, what to invite you to.
For example, we’re busy planning: a physical breakfast considering the policy implications of crypto; a virtual meeting on the impact of planning rules on cost of housing/office space/labs; six breakfast meetings on further immigration/visa reforms. Some of these will be added to future newsletters, but most will be nearly full by the time you hear about it here. You can also drop me an email to events@tenentrepreneurs.org if any are of particular interest.
It is Easy
Our good friends at FieldHouse have written to the Prime Minister and Rt Hon Alok Sharma MP calling for Green Standards, Green Tax Credits and a Green Tax.
You can read the full letter here. They’ve also published a brief article here, have a Twitter thread here and a LinkedIn post here. It’s backed by a number of notable founders and investors from the UK ecosystem. Drop Iain a message if you’re interested in getting involved.
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