Female Angel investors

Only about 10 percent of Kenyan startups have female chief executives, highlighting gender disparity in the African tech startup ecosystem, a new report shows.

The latest Disrupt Africa report dubbed Diversity Dividend: Exploring Gender Equality in the African Tech Ecosystem’ shows that only 11.2 percent of Kenyan startup CEOs are women and 16.6 percent are female co-founded.

Out of 331 Kenyan startups surveyed, 55 were co-founded by women and 37 had female chief executives.

“Generally, in markets with enough tracked startups to discern any trends, the smaller ecosystems outperform the larger ones from a diversity perspective, with greater ratios of female leaders in markets such as Zambia, Rwanda, Tunisia and Senegal than in traditional hotspots such as South Africa, Nigeria, Egypt and Kenya,” read the report in part.

In South Africa with 521 startups identified, 71 were founded by women and 46 were female-headed.

Nigeria followed with 502 out of which 83 or 16.5 percent had women founders and 10.8 percent had female CEOs.

“This report highlights the importance of diversity in the industry, particularly the need to address the historic disparity,” read the report in part.

“39.6 percent of venture capitalists (VCs) investing in African startups between 2022 and April 2023 have at least one female founder or general partner or managing partner. Among the Africa-based VCs active, this number goes up to 47.8 percent while 6.1 percent of angels investing in this period are women.”

The number of female angel investors in the period sampled from 2022 through to the end of April 2023 was nine out of 148 pundits.

“This means that only 6.1 percent of angels actively investing in Africa are women,” said Disrupt Africa in the report.

An angel investor provides initial seed money for startup businesses, usually in exchange for ownership equity in the company.

The report revealed that out of 280 firms investing actively in Africa, 111 have a female founder or partner.

The respondents working in venture capital said lack of awareness and relegation of women in African societies were among the reasons for the low number of women investors.

Others pointed out the stereotypes where men are assumed to have more money hence better investors.

“Six per cent of our members are female. The reasons for this are firstly, low awareness. Second, is the traditional relegation of women over the years. It’s all part of the gender disparity experienced across different sections. Third is economic positioning of women, especially in an African context,” said Ms Uche Aniche, a director at SSE Angel network in Nigeria.

“There is a myth that “angel investing requires significant amounts which only men can afford” – this can be true in particular African cultures; and it locks out a significant number of individuals who want to invest in startups, including women,” added Mr Michael Kariamu, network manager, Viktoria Business Angels Network.

By Edna Mwenda

https://www.businessdailyafrica.com/bd/corporate/companies/only-10pc-of-startups-in-kenya-have-female-chief-executives–4294350