Entrepreneurship Has a Gender Problem — But It’s Not What You Think

Is gender discrimination standing in the way of entrepreneurship?

Recently researchers at MIT asked this very question and found a disturbing answer: “Both professional investors and nonprofessional evaluators preferred pitches presented by male entrepreneurs compared with pitches made by female entrepreneurs, even when the content of the pitch was the same.”

Perhaps this helps explain why the total unmet financing needs for women-owned businesses around the world are an estimated $260 billion to $320 billion. Or why, in developing countries, as many as 70 percent of women-owned businesses are underserved or even unserved by financial institutions.

Either way, the gender gap in financing is bad news, particularly as women emerge as a force for markets, innovation, and jobs around the world. In Africa, for example,study after study shows women have the capacity, confidence, and follow through to start and grow a business, to the point where women entrepreneurs actually outpace men in countries like Zambia and Nigeria. Yet these businesses may already be limited for the simple reason that they aren’t owned by men.