Despite venture capital funding rising significantly over recent years, in 2023, companies founded solely by women received just 2% of the total capital invested in venture-backed startups in the US.

This bleak picture is echoed on the other side of the Atlantic. Last year, a cross-party Treasury Committee of MPs criticised the ‘unacceptable’ level of diversity in venture capital.

This year’s International Women’s Day theme is ‘Inspire inclusion’, and it’s clear that more needs to be done to support future generations of female founders and business leaders to overturn these stark figures.

Seeing these statistics prompted me to consider my own entrepreneurial journey. Having grown up in a family of small business owners, it was perhaps inevitable that I would launch my own ventures.

After starting a vintage clothing business and rescuing and recycling pre-loved clothes to be resold at music festivals, I developed and launched a range of FairTrade and organic fruity ice pops, which reached supermarket shelves. My second startup was a VC-backed app for tenants to review their rental properties - a TrustPilot for renters.

All of these experiences provided me with an unrivalled learning curve - from spending five years developing a product and brand to managing relationships with co-founders, stakeholders and investors.

They also provided an important education on the intricacies of equity and cap table management. These areas are sometimes overlooked when people are building a business, but they are not only absolutely essential to attracting investment but can also go a long way to driving more inclusion for female entrepreneurs.

One of our key missions at Vestd is to drive greater awareness about the power of equity for founders and employees alike. A stronger understanding of the power of the ‘ownership effect’ - the impact that teams having skin in the game can have on productivity and engagement - could be massive to help female founders attract and retain the talent they need to grow their business from a great idea.

Recruiting and retaining people at the early stages of a business is always tricky. Employees may believe in your mission, but they have bills to pay and rightfully expect fair recognition and reward for their hard work.  

Equity and inclusion go hand in hand, but share schemes are still not widely adopted. Despite there being 5.5 million SMEs in the UK, just 14,000 companies use the most popular HMRC-backed Enterprise Management Incentive (EMI) scheme.

When so many businesses are driven by a clear meaning and purpose, there’s much more to do to shift the mindset that share schemes are preserved for huge corporations and Silicon Valley hotshots.  

Analysis by Vestd shows that if 250,000 businesses in the UK shared equity with their teams, it could drive a £2.4 billion economic boost across the country. This doesn’t just mean more cash flowing into Treasury coffers, but could result in life-changing financial gains for staff and help to inspire further startup projects. One of our customers’ share schemes enabled most of his team to pay off their mortgages.

I began this article with some alarming stats about investment in female founders, but it's important not to overlook the progress we have already made. We’ve clearly seen huge steps forward in recent years, driven by movements within universities and incredible networks of female founders.

International Women’s Day offers an opportunity to reflect on this progress, but there’s no doubt that more work needs to be done to widen awareness about the impact that equity could have to drive a new wave of investment in female-founded businesses.