By Katie Kostashchuk
Originally published on the Equitise Blog
(republished with permission)
As the world of finance has been, for a long time, seen as an ‘all boys club’, women have been marginalised in traditional forms of finance, venture capital and business angel investing. On average, women-owned firms start and grow their businesses with considerably less external financing compared to men (Department of Commerce US). In Australia, female entrepreneurs have experienced undercapitalisation as a core issue that undermining the success of growing their business. A 2013 study conducted by the (Australian Women Chamber of Commerce and Industry (AWCCI) of 3000 women entrepreneurs found that half of those surveyed required more funding to facilitate the growth of their business. The majority of those women have started their venture with less than $5000 worth of capital.
Crowdfunding platforms, however, now offer female entrepreneurs the chance to promote and grow their business by providing access to capital. By providing such opportunity, crowdfunding democratises finance by placing women on a level playing field with men. Moreover, with a growth in female entrepreneurship in Australia and the amount of women starting businesses increasing by 8.9% in 2013 (AWCCI), access to crowdfunding platforms in Australia will play a key role in providing capital to women. Women are almost 4 times more successful when crowdfunding than raising capital through traditional means. The number of female-owned businesses that receive venture funding in US is only 13%, however the number of crowdfunding campaigns run by women that meet their funding target is around 47% (Forbes).