Why removing barriers to financing for women-led businesses is essential

0

Martino Picard, Chairman of Discovery Park and Director of Discovery Park Ventures, on the funding barriers preventing the growth of women-led life sciences companies in the UK.

The UK is a global player in healthcare. It occupies a unique position at the forefront of scientific discovery and the development of effective treatments.

The country’s growing life sciences sector has the potential to transform the outcomes of millions of people whose lives are impacted by a wide range of debilitating conditions and generate the strong growth the economy needs to recover. of COVID and the ensuing financial downturn. So why would we hold back this progress by refusing to fund promising start-ups just because their founders are women?

It sounds incredulous, but that’s exactly what’s happening. Women-led start-ups are being left behind, unable to secure “warm” introductions to venture capital funds and turned down for funding in far greater numbers than applications from their male counterparts.

And even if we are not at the level of Austria where, in a recent report by Female Founders and Ernst & Young, not one euro of the 881 million euros raised in venture capital during the first half of 2022 is went to an all-female-founded team, we can’t be complacent.

A 2019 report by the British Business Bank showed that at that time, all-female founding teams received less than 1 pence for every pound of venture capital investment and that 83% of deals closed by venture capital firms British venture capitalists had no wives. the founding teams.

Has this position improved over the past three years? I’d like to think so, but without new data, we can’t be sure that women are getting a seat at the table now.

If we are to maintain our position as a world leader in the field of life sciences, we must capitalize on every ounce of talent and that means we must prevent the “alumni club”, some of whose members remain deaf to ideas, contributions and women’s funding demands, blocking the way to progress.

There are a handful of venture capital funds dedicated to supporting female funders and although Discovery Park Ventures, which launched in May this year, places no restrictions on applications, the fact that four of its first four investments went to companies with female founders shows how committed we are to supporting exceptional science and talented teams without reverting to outdated ideas about who sits on the board.

Those we have supported so far include Vitarka Therapeutics, formed by Dr Vineeta Tripathi in 2021 to create combination medicine using RNAi therapies for patients with advanced stage cancers and, more recently, BoobyBiome, founded by the scientists Dr Lydia Mapstone, Dr Sioned Jones and Tara O’Driscoll, to develop a new product for babies who do not have access to the beneficial microbiome of breast milk.

Uzma Choudry, investment manager at Octopus Ventures, also wants to see change.

She says: “In the UK, the total venture capital investment in female founders is less than 5%. For the record, in biotechnology, this number is much lower. People tend to invest in people like them. This is particularly a problem when venture capital investment teams are generally not diverse on most metrics and this is reflected in the people they meet, the questions they ask (there is evidence that male founders are asked different questions than female founders) and where they invest .

“To ensure that more diverse founders receive their share of funding and that we support the best ideas and teams, no matter who or where they come from, we must undertake the hard work of building teams that reflect a diversity of points. perspective and experiences. It means looking for new talent, implementing new recruiting processes, and treating differences as a default strength. It also means that VCs strive to invest in the group of founders. broadest and most inclusive by setting goals, changing our processes so no one is favored, and creating ways to reach founders we might otherwise miss.

“Octopus Ventures has started this journey – we have set clear goals for investing in diversity and are transforming our processes to ensure we find more founder diversity and give them fair investment terms. first steps on a long road, but each step strengthens Octopus Ventures and the companies we invest in, as diverse founding teams create more innovation and better business outcomes.”

But it is not only at the level of financing that things must improve. We need to attract a pool of female talent, from school graduates all the way up, into the life sciences sector to ensure that we continue to take a balanced approach, with fresh ideas, contributions and new ways of approaching problems, influencing this business every moment. level.

Share.

Comments are closed.