There has always been a much-discussed gender and ethnic imbalance for start-ups and entrepreneurs when it comes to accessing financial support. But there’s huge untapped potential there. Potential that could transform the UK economy. Don’t waste it.
It’s no coincidence that there is also a marked lack of diversity around the table when it comes to investors, advisory boards and policy makers.
While Wednesday’s mini budget brought truly encouraging news for 16-24-year olds, it brought no news at all for those left unsupported by the government’s existing Covid-19 financial support measures – such as new start-ups, newly self-employed and those struggling with home schooling and childcare. Certain parts of society have been seemingly forgotten during the current pandemic situation, making the need for a diverse voice more important than ever.
I had the opportunity to talk about this in a BBC interview with Victoria Derbyshire on the day of the budget and it has also been a very recent topic of discussion among the Northern Power Women community, at our regular Power Circles. And, unsurprisingly, we are all agreed.
We all know the issues – and they are all pretty much solved by one thing…
When it comes to private investment, not only are entrepreneurs frequently faced with a room full of white, male investors, but also a room with little knowledge and experience of start-ups and how they operate.
One of our circle, Elizabeth Vega, founder and CEO of Informed Solutions, also pointed out that male and female entrepreneurs tend to operate differently – and male and female investors invest differently. And all these differences should be considered and reflected, both through diversity among decisionmakers and in the investment options available.
There are institutional biases and preconceptions to overcome too, eg, that women are more risk averse, or even that they are not as numerate. We talked about an article in the Harvard Business Review, how there are so many assumptions made about women and, regardless of whether they are positive or negative, all of them hold us back. And the science and data don’t support them. As Elizabeth said: “We’re just as ambitious, we’re just as gutsy, but society won’t seem to accept us like that.”
Government schemes don’t seem to be working either. The Future Fund, for example, delivers a double whammy in that it is dependent on certain criteria, one of which is having already secured private investment – which we know is a problem for women, non-white and minority ethnic businesses. Of the 252 companies approved for funding from the government, just three had all-female management teams, and just 12 had either all non-white or all minority ethnic management.
Female, non-white and minority ethnic representatives need to be at that table, to ensure that schemes are well thought through from the ethnic and gender perspective and can be marketed better.
And look what we can deliver…
Within the Northern Power Women Community alone, we have:
Vic Stewart’s 6% Club, committed to drive diversity in the North West deal making community, named after the fact that only 6% of senior investment professionals in UK private equity firms are female. Her aim is to make deal making more accessible to all.
Greenology – established by female entrepreneur Laura Hepburn. Her vision for her green business has seen tonnes of material recycled, preventing it from being taken to landfill sites or incinerated. Her business has thrived, even during the pandemic, and despite a devastating fire at the site. She has powered through and is delivering back – now recruiting for 50 jobs.
The Black United Representation Network (BURN) – a new organisation set up to challenge and tackle racial inequalities in Greater Manchester. It has a range of campaigns, one of which is to ask for 1% of Greater Manchester Combined Authorities’ spend to be ringfenced for black-owned organisations, to deliver services in a city region that is 25% black, Asian and minority ethnic. Principal founder, Dr Marilyn Comrie OBE, says: “The effective exclusion of black-owned businesses from the public supply chain impedes their growth and inhibits economic development within our most disadvantaged communities, who have already been disproportionately impacted by the coronavirus pandemic.”
Jane Dalton founder of Groundswell Innovation, is also involved in Lancashire County Council’s Two Zero, helping women-led business in Lancashire to scale up and innovate. She says: “There are many structural barriers for women business owners to get past, but there are also psychological barriers to overcome. Through our ground-breaking scheme, mindsets have shifted and business behaviours are following suit.”
By the end of one Two Zero workshop, for example, all women (including myself) took up the bounce back loans. It just needed to be explained and discussed in terms that we could all relate to.
Also, in the autumn, Northern Power Women will be hosting an investment circle, bringing together investors, and woman. Non-White and minority ethnic businesses. We’ll advertise it on our Power Platform, so please do get in touch if you’re an investor or a business that’s seeking investment and you want to get involved.
Like I’ve said before, we don’t hang about.
Northern Power Women is a 60,000-strong network, born initially out of a need to accelerate gender equality in the North. But now our diverse community is spread out across the UK and spans all sectors, genders and demographics.