According to a recent study by the Boston Consulting Group, when women business owners pitch their ideas to investors for early-stage capital, they receive significantly less than men – a disparity that averages more than 1 million USD.

Yet businesses founded by women ultimately deliver higher revenue – more than twice as much per dollar invested – than those founded by men, making women-owned companies better investments for financial backers.

One might think that gender plays no role in the realm of investing in early-stage companies. Investors make calculated decisions that are (or should be) based on business plans and projections. Moreover, a growing body of evidence shows that organizations with a higher percentage of women in leadership roles outperform male-dominated companies. Unfortunately, however, women-owned companies do not receive the same level of financial backing as those funded by men.

The increasing role of women angel investor networks in early-stage equity markets Notably, women entrepreneurs are stepping up to the plate. In a survey of 279 U.S. women entrepreneurs conducted jointly by Inc. and Fast Company, a surprising 42 percent said that in addition to running their own companies, they made personal investments in startups. On the flip side, of those who had raised outside capital, 38 percent said they specifically sought out female investors.

As of November 2017, according to the Angel Capital Association, 22 percent of angels are female. That percentage may sound low, but it is a lot higher than in the venture capital industry, where only 9 percent of decision-makers are female, according to CrunchBase. And the trend is upward: 30 percent of angels who began investing in the past two years are females.

These women are more likely to consider the gender of the entrepreneurs they back than men are: 51 percent of female angels say an entrepreneur’s gender is ‘highly important’ in their investment decisions, compared to only 6 percent of male angels.

But more experienced angels tend to write bigger checks than newer ones. That may explain why the size of women’s checks is somewhat smaller – $26,500 on average in the U.S., compared to $37,700 for men. All these statistics signal an increasing role for women angel investors in early-stage equity markets.

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