What Should Women Think about First, Before Funding Their Business?

Female-founded companies are often less successful in securing funding from venture capitals. The bias is often because of lack of women representation in venture capitals that can evaluate the female appealing business, as said by Julie Wainwright, founder, and CEO of consignment website The RealReal in a Fortune article.

In a Harvard Business Review research, venture capitals tended to ask men questions about the potential for gains and women about the potential for losses.

According to the psychological theory of regulatory focus, investors adopted what’s called a promotion orientation when quizzing male entrepreneurs, which means they focused on hopes, achievements, advancement, and ideals. Conversely, when questioning female entrepreneurs they embraced a prevention orientation, which is concerned with safety, responsibility, security, and vigilance. We found that 67% of the questions posed to male entrepreneurs were promotion-oriented, while 66% of those posed to female entrepreneurs were prevention-oriented. (Harvard Business Review, 2017)

Female founders may have faced a hard time in breaking through successful funding pitching, and it’s the matter of time taken to polish up skills and come well prepared.

One of the most common tip for female founders is to make sure you have a good business plan and have all your ducks in a row (so to speak). The best way to get funding is to show you are prepared and have a clear path for success. You can check out 6 Powerful Pitch Deck Tips to Get Seed Funding by Amanda Holt.

As founders face a lot of rejection before they finally get venture capitals to fund them, it’s important to embrace them. It’s important to focus on how to move past rejections. Rejection is commonplace in business so you have to prepare yourself for it. If you’re not ready to face rejection you need to ask yourself if you’re really ready to start a business. Kim Perell, CEO of Amobee, written about how to move past rejection.


Leave a Comment