Businesses started by women have received less than 5% of venture capital funding in Africa over the past decade, according to a new report. The report says investment in female-started businesses decreased further last year, frustrating businesswomen and those who want investors to give them greater consideration.
Female-founded businesses are the driving force behind innovation and inclusive growth in Africa, but those businesses face many challenges when seeking investment, according to the report by business research platform Briter Bridges and non-profit organization V54 Open Impact.
Akosua Lefty, a Ghanaian businesswoman who specializes in developing products for natural hair, said she has struggled to attract interest from potential investors over her two years in business.
An investor will express interest then never reach out again, she said, or will want to make money immediately, which may not be possible.
Briter Bridges and V54 Open Impact say that of all the capital venture funding across Africa in the past 10 years, less than 5% went to women founders.
Elizabeth Mwangi, founder of Gwiji, which connects women cleaners to clients, got her first funding in 2020, which helped her develop an app that could help support and empower women to make a living.
She said the next funding she got was in 2023, when she was nearly giving up on Gwiji. She earned the Aurora Tech Award, a global honor that focuses on women. Following that, she was able to get $30,000 in funding that enabled the company to get an office and launch secondary programs that help women.
Mwangi said she is partnering with more organizations, like the U.K. government-backed Transform, to widen her reach beyond Nairobi.
The aim, she said, is to empower more women from informal settlements, because every day she gets calls from women across Kenya who want to join Gwiji and earn a decent income. Partnering with Transform, she said, allows Gwiji to diversify its services and employ more women.
African women face more challenges beyond funding, including gender bias, lack of access to support networks, culture and policy changes.
Lefty said she is ready to be patient and build a business that can withstand the challenges of being a woman.
Mwangi and Lefty are urging other women in business not to be discouraged, but to build businesses that help solve community problems and to keep seeking opportunities and investors who support their dreams.
