KANSAS CITY, Mo. — New research by the Boston Consulting Group suggests that closing the gender funding gap for entrepreneurs could pay off big time for the global economy.
According to the study, if female entrepreneurs were given the same funding and support as their male counterparts typically receive, the global GDP could rise to 3 to 6% — adding $2.5 trilion to $5 trillion to the global economy.
The research shows startups founded or co-founded by women generated 10% higher cumulative revenue over a five-year period compared to those started by men.
However, the data also showed that investments in 2018 in companies founded or co-founded by women averaged $935,000, which is less than half the average of $2.1 million invested in male-led companies.
Director of Experiences for the Kansas City Startup Foundation Jessica Powell said she believes part of the reason that women-led businesses are doing well is because women make a lot of the decisions in the home.
"They're purchasing things, they are actively holding the checkbook nowadays and deciding what comes into their home, so it only makes sense to then fund female entrepreneurs so they can be producing the products and services that people are buying," Powell said.
She believes part of the reason female entrepreneurs do not receive equal funding is because women are rarely the ones writing the check.
"We need to increase female investors, so we can see more female entrepreneurs," Powell said.
Entrepreneurs like Kansas City native Lawren Lawrence, who worked as a court reporter for six years before she realized technology could make it easier for court reporters, editors and proofreaders to do their jobs rather than juggling a handful of different tools and trying to coordinate them.
"I just kept thinking, there has to be a better way to do this," Lawrence said.
She created Stenovate, a platform that simplifies the court reporting process and allows editors, reporters and proofreaders to work more efficiently and save time.
Lawrence pitched the idea at last year's Pure Pitch Rally in Kansas City and landed her first investor, the Fenaroli Minera Investment Fund led by Karen Fenaroli, who serves as CEO of Fenaroli and Associates.
"I think now is a really exciting time for women and they are stepping forward, and I think men are even starting to really recognize the value of what happens when you put both genders into a work space, because it brings out different sides and makes for more cohesive work groups," Lawrence said.
Powell said one way for female entrepreneurs to be more successful is to network.
The Kansas City Startup Foundation will host a meetup Sept. 19, which is focused solely on female entrepreneurship.
Powell hopes to have a diverse group of people there.
"I would like to encourage men to be there," she said. "Without men supporting this equal change and equal balance, we won't get there."