Quite a lot has been said about the gender wage gap in the number of male-owned and female-owned businesses. There is a big disparity when it comes to how much male- and female-run businesses make. According to a 2014 report by Ernst & Young, male-run businesses are 3.5 times more likely to surpass USD 1 Mn in sales than their female-run counterparts and only 2 percent of women-owned companies ever break the million-dollar mark.
The huge gender disparity has been attributed to many factors key among them being the fact that women have a hard time accessing finances to grow and support their business.
In a bid to financially boost women-owned businesses, RENEW and the Impact Angel Network (IAN) have committed capital to a fund dedicated to investing in women-owned and led companies in Ethiopia and Uganda. The two, which happen to be the most active investment groups that focus on SMEs designed the fund to address a pressing need to close the financing gap for women-owned companies in Sub-Saharan Africa.
The new fund is expected to make investments in 3 to 5 women-owned companies, pending satisfactory completion of due diligence. The fund, which supports the Sustainable Development Goals (SDGs), was oversubscribed by the IAN and will support job creation for women and youth and empower women entrepreneurs in Ethiopia and Uganda.
“There is data that shows that despite comparative investment outcomes, female entrepreneurs are often overlooked by the business and investment communities,” said Laura Davis, Partner & Head of Investor Relations at RENEW. “We hope the Impact Angel Network can show others that by investing in women-led companies we are not just advancing a social agenda, we are making sound investments.”
The announcement was made through a press release and a part of it read, “The inspiration for the fund came after a number of the owners being considered for the fund took and excelled in RENEW’s Exec’s Program, a four-month business program which provides participants with the tools they need to successfully scale their businesses. All the companies currently being considered for the fund have completed or are currently participating in The Exec’s Program.”
“We’ve known the women we are planning to work with as part of this fund through our Exec’s Program, and we have been impressed with their companies,” explained Laura Davis.
Women continue to establish venture funds specifically targeting female entrepreneurs and focusing on female markets. These women-focused venture funds are seeking to invest in companies that are run by women, and which have solutions to address those problems being experienced by women.
Unlike the beginning of social impact movement, women and girls are now viewed as financial movers and shakers program other than just beneficiaries. Like never before, women are making moves to positively impact their local communities.
Featured Image Courtesy: The Guardian Nigeria