How female founders can overcome investors' gender bias

Eight out of 10 young people cannot name a single female entrepreneur. When they hear the word ‘entrepreneur’, they are four times more likely to think of a man than a woman.

These figures are drawn from a report by the UK Government’s Women-Led High-Growth Enterprise Taskforce, published in 2024. However, they are unlikely to have changed.

What impact does this “think entrepreneur, think male” perception have on entrepreneurs looking for funding?

A well-known gender gap exists in funding for high-growth start-ups. Just two pence of every £1 invested in venture capital funding goes to female-founded businesses, according to the British Business Bank.

This is the result of an equally well-recognised gender bias among investors. Our previous research identified several factors that contribute towards this bias.

Why female entrepreneurs are penalised

Bias can be influenced by familiarity; investors are used to working with male founders, and so men are subconsciously viewed as the 'default' entrepreneur type. When there is uncertainty, investors tend to go with what feels familiar.

These types of subconscious bias affect the way investment decisions are made.

Our latest research focuses on how women can counter this bias by optimising their pitches.

To be clear, female founders should not be responsible for tackling this issue. Investors need to be aware of biases, especially as they may lead to sub-optimal investment decisions.

However, that change is likely to take time as we have all been socialised in the same world where the most salient examples of high-powered entrepreneurs are men. Until then, this advice may act as a band aid, helping women to overcome some of the immediate challenges they face.

1 Avoid hype

It is important not to conflate ambition with ‘hype’. The former simply means targeting high growth which is generally more appealing to investors because while the risks are higher, so is the potential payoff. Hyping is a way of talking about that ambition, not the level of ambition itself.

Hyping is when a founder makes unsubstantiated claims about a venture (eg “this is going to be a home run!”) without providing economic or technical backing.

In our research, we assigned male and female avatars to pitch for venture capital funding to 178 investors. Using avatars made the pitches equivalent on factors such as tone and mannerisms and allowed us to test which combination of gender and framing worked best.

Our findings demonstrate that hyping works better for men. Conversely, de-risking – which emphasises validation, proof, and feasibility – works better for women.

Investors trusted more female founders who de-risked than those that hype and were more willing to meet them for a follow-up. So much so that the disadvantage faced by female founders was cut by more than half.

This may offer a partial solution for female founders, at least in the short-term.

Women benefit from presenting ambitious growth plans in a measured way, showing that thorough testing has been done, possible outcomes considered, and risks identified.

As investors get to know the founders over time, hype may become less important, as a reputation is established.

2 Tailor your pitch to the investor

While further testing is required for conclusive findings, the emerging patterns suggest that female and male investors have different preferences.

Interestingly, female investors tended to favour female founders who de-risked and male founders that hyped. Male investors, on the other hand, seemed to prefer de-risking overall. The reason for this is unclear and worth investigating. Could male investors be more alert to ‘hype’ language and more vigilant in evaluating it?  

These patterns suggest it is worth tailoring a pitch depending on the gender of the investor. This applies to male founders as well as females, with female investors more receptive to hyping by male entrepreneurs.

Women should persist with de-risking framing overall, and especially when pitching to female investors.

3 Timing is crucial

We would advise women to provide more reassurance and evidence early in the pitch in order to pre-empt critical questioning later.

Research shows that when this is not done, female founders receive more questions related to risks and losses than male founders during the Q&A.

This needs to be avoided to maintain focus on promoting the business idea, so close out those critical questions before they arise.

But while investors approved of early de-risking, they also emphasised that founders needed to go with a big opportunity story and warned female founders that too much de-risking may be perceived as lacking ambition.

This means there could be an optimal balance between focusing on de-risking and emphasising a big opportunity story, which could be the winning combination for women.

There are other factors to consider. For example, evidence suggests that warm introductions  can help female founders secure investment.

Variations in investors’ cultural or ethnic background may also have an effect. Further research is needed to test how this might affect investment decisions.

This is undoubtedly a subject that warrants further investigation. After all, securing venture capital is a vital step in the growth of many start-ups.

Developing a stronger understanding of investors’ preferences, biases, and behavioural patterns will help founders to maximise their chances of success.

4 Don’t hang back

The good news is this: when women do get funded, they tend to build strong, successful businesses. So this isn’t about a lack of great ideas — it’s about access to capital. In fact, research shows that female-led ventures often outperform male-led ones when they receive investment.

When women are underfunded, capital isn’t flowing to the best opportunities, it’s being misallocated.

This also shapes what gets built. Women are more likely to innovate in underserved markets and areas like women’s health, meaning that when their ideas are overlooked, entire segments of innovation are left behind.

And when there are fewer funded female founders, there are fewer visible role models. This can discourage the next generation from stepping forward.

The takeaway is simple: don’t hold back. If you’ve got a strong idea, go for it — the ventures that do get funded show just how much value is waiting to be unlocked

Learn how the Warwick Innovation District Female Founder Programme supports female entrepreneurs and their start-up businesses.

Further reading:

Why are ambitious female founders penalised by investors?

Can diverse workplaces increase innovation?

Why don't more women reach the boardroom?

How should digital start-ups pursue growth?

Noni Symeonidou is Associate Professor of Entrepreneurship and Innovation at Warwick Business School. She teaches on Entrepreneurship and New Venture Creation on the Full-time MBA, Executive MBA, Executive MBA (London), Global Online MBA, Global MBA (London), and Accelerator MBA (London).

Dawn Eubanks is Associate Professor of Behavioural Science and Entrepreneurship and Innovation at Warwick Business School. She teaches Leadership on the Executive MBA and the Executive MBA (London), Leadership and Harnessing Diversity on the Full-time MBA and Global Online MBA, Leadership Plus on the Full-time MBA, and Leadership Accelerator on the Accelerator MBA (London).

Learn more about the three-day Executive Education programme Strategy into Action at WBS London at The Shard.

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