Why Female-led African Startups Struggle with Venture Funding
African startups were able to raise about $350 million in Q1 2020, according to Briter Bridges, a data consultancy. In view of the ongoing global health and economic crisis caused by the coronavirus pandemic, this achievement is laudable and proofs the exploits of African innovators in proffering tech-based solutions to challenges across the continent. However, amid this fundraising, women-led companies have been left behind as compared to the same quatre in 2019.
As per a new report from Briter Bridges, startups led by women were able to raise only 3.2% of the total of all the money raised in Q1 2020. Considering that in 2019 they were able to raise 5.7%, it is clear that the amount of funds African female founders have received is dropping exponentially. The cause of this situation can be attributed to a shortage of female-led or female-founded startups in Africa – from over 2000 African startups surveyed in the Briter Bridges report, only 16.5% of co-founders and executives at the C-level were women.
Another cause of this challenge is gender discrimination towards African female founders. Gender inequality is not new in the technology industry. On a continental and worldwide scale, bridging the gap between male and female participation in the technology sector remains a challenge across various sub-sectors and career levels. To worsen matters there is an evident drop in the interest of younger women which could further stagnate the development of the sector’s female talent stream.
Shortage of Female-led Startups
According to a survey by Techcabal themed ‘Nigerian Women in Tech’, 65 % of the female Science, Technology, Engineering and Mathematics (STEM) university students choose their course of study out of a personal interest in the field as opposed to external pressure to pursue a particular career. While 76% of respondents linked their academic struggles to non-gender factors, less than 50% see themselves pursuing a STEM-related career in the next 5-10 years.
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