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A stark gender imbalance exists in UK entrepreneurship. Not only is the allocation of investment to startup businesses imbalanced, the funding gap isn’t closing fast enough. Female-founded businesses receive just 2% of the total invested in UK startups, according to government research published in February 2024.
Though self-employment among women is on the rise, there are still fewer self-employed women than men, and those who are typically earn less.
Despite the challenges, more women are founding companies than ever before. In 2023, 164,000 companies were incorporated by women – 4% more than in 2022 and 26% more than in 2019.
Across the UK, work is underway to tip the scales in support of female founders. We spoke to two women about their experiences as entrepreneurs and asked them why – against the odds – 2025 is a great year for women to start a business.
Access to finance is improving
It has been estimated that the UK economy could benefit from an extra £250 billion if the share of female entrepreneurs can increase in line with male entrepreneurs.
Recognising the potential of female founders, the government established an Invest in Women Taskforce in 2024 to address funding disparities. The £250 million ‘women backing women’ fund has garnered commitment from finance giants like Barclays, Aviva and Morgan Stanley. Britain’s first female chancellor Rachel Reeves is right behind it too.
Female angel investors are also helping to drive positive change, acting as mentors and opening doors for founders as well as providing capital. The visibility of female investors – often successful entrepreneurs themselves – is key to inspiring more women to start a business. Though women made up just 14% of the total angel investors in the UK in 2022, this small minority are making a meaningful difference.
Research by think tank The Entrepreneurs Network (TEN) found that female investors are more likely to back diverse founders and angel groups with more female members allocate a higher proportion of funding to all-female businesses.
Our female founders’ perspective
NerdWallet spoke to 28-year-old Sophia Lan, winner of the 2024 Female Founders competition with Virgin Startups and Fiverr. Sophia built an AI-powered app – WInvest Collective – that gamifies financial education and offers a “crash course” in investment to help women become financially independent.
Sophia is excited about the millions of pounds of investment that will be dedicated to female entrepreneurs. Her advice for aspiring founders is to build relationships with entrepreneurs who have previously received funding, as this can give you “a bit of a head start understanding the criteria” that investors are looking for.
“Start networking and chat to early-stage companies and understand their experience,” she says.
Laura Richards is a freelance PR and Marketing Consultant working predominantly with businesses in the tech and startup space. “I’ve been working in tech and Venture Capital (VC) related fields since 2015. This feels like the easiest time in that decade to find people actively looking to invest in diverse founders, and that feels really exciting,” Laura enthuses.
As well as VC funding, financial support is also available to startups at a local level. Laura has received funding through the local authority to launch a podcast. “Looking at your local authority website or your local enterprise partnership (LEP) can be a good place to find out what’s available to your business,” she says.
Your allies are out there
Building a business can feel isolating, especially if you identify with an underrepresented group of entrepreneurs.
Networking can be daunting for female and non-binary founders, especially in male-dominated spaces.
While some founders may relish the chance to attend global conferences and investor events, others may feel an informal coffee morning suits them and their business better. Both types of gathering enable entrepreneurs to exchange ideas, learn from one another’s experience and find business owners or mentors with a similar mission.
Our female founders’ perspective
After winning the Virgin StartUp competition, Sophia attended an investors event and noticed very few women compared to men.
“I went to a Founders Day and I would say maybe 10% were women and 90% were male,” said Sophia. “We definitely have female founders out there, but I haven’t seen a lot of them at these events.”
Laura’s suggestion is to start local. “My network started here in the North East. Meeting other people that are in close proximity to you makes it easier to ask questions and build that initial relationship,” she said.
When networking face-to-face is difficult, online networks can be hugely helpful. “There are thriving community groups on Facebook for businesses,” says Laura, who recommends social media platforms “to get advice, to build connections and to start feeling like you’re not alone on the journey.”
Motherhood can be a strength, not a setback
Motherhood is widely cited as one of the reasons there are fewer women-led businesses in the UK. As well as being an important factor in the gender pay gap, caring responsibilities can make it harder for women to engage with business networks.
On the other hand, the need for greater flexibility at work can be a key driver of self-employment among women, and becoming a mum can be a source of business inspiration. Maternity leave can also create an opportunity for female founders to learn, test and develop their startup ideas.
Our female founders’ perspective
Laura is 36 and a mum to two young boys. In 2022, she joined the Ignite pre-accelerator programme as a non-technical founder before finding out she was expecting twins. She received grant funding to develop her idea of creating a tool that would enable companies to build their own bespoke Customer Relationship Management (CRM) systems using ‘no code’ programming.
“I was still a beginner to intermediate no code builder. I knew some of the tools, I could do some stuff, but certainly not as developed as I am now. I used my maternity leave to figure it all out properly,” Laura explained. She returned to Ignite in 2024 to share what she’d learned with other founders.
While she recognises “there are still massive issues” in accessing finance for underrepresented groups, Laura has seen first-hand how VC and founder networks are finding practical solutions to the problems that systemically disadvantage women, particularly mothers.
For example, when investor network Alma Angels put on an event for female founders, professional childcare was provided. “Founders with kids aren’t excluded,” says Laura.
Five groups to follow in 2025
These are the networks and communities our female founders recommend:
- Zinc VC – backed by the British Business Bank, this fund is aimed at founders whose business ideas tackle complex societal and environmental challenges.
- Antler – this global community supports founders at the very beginning of their journey, while their business idea is still in development.
- Female Founders Rise – described as a ‘mega network’ for women and non-binary founders, this community empowers entrepreneurs to build profitable businesses.
- Alma Angels – a movement that aims to level the playing field, this community of more than 450 investors have pledged their support for women entrepreneurs.
- AllBright – a network for women who are “unapologetically ambitious”. Paid membership gives founders access to learning, coaching and events.
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