Gender disparity among angel investors is a missed growth opportunity 

Across the UK in 2024 and 2025, female-led companies grew turnover significantly faster on average than male-led companies and those with mixed leadership teams, according to the 2026 Gender Index Report. With female investors twice as likely to back female founders, widening participation could be the key to addressing the chronic underfunding of female-led businesses.

 

Women are already driving significant direct investment towards early-stage companies and supporting business growth and job creation. The UK Business Angels Association reported in 2022 that female angel investors had helped drive more than £2 billion of investment in UK companies over the previous decade, backing 4,000 businesses, 1,000 of which were female-founded. However, women make up just 14% of angel investors in the UK. 

 

Facilitating greater female involvement in angel investment across the UK is a strategic priority for Women Who Scale. The evidence suggests that not only would this drive more funding to female-led businesses, but investors would gain greater access to businesses with strong growth potential.

 

 

A significant missed opportunity

The question remains why there is still such a significant disparity between the funding received by early-stage businesses led by women and those led by men. 

 

Fully female-founded businesses receive just 2% of equity investment in the UK - a statistic that remains stubbornly unchanged for the past decade.  This is an economic failure: many companies with significant growth potential are being overlooked, and the country is missing out on the employment opportunities that scaleups bring to their region.

 

In the tech sector specifically, the UK still lags behind countries like the United States on overall gender representation in leadership roles. Yet it has been widely evidenced that diverse teams are often more likely to deliver the financial results that investors are looking for. 

 

In 2024, research published by the Department for Science and Technology (which has recently been combined with the Department for Business and Trade, becoming DBIST), found that a lack of diversity has tangible economic implications. The researchers found that tech companies in the bottom quartile for both gender and ethnic diversity in executive teams were, on average, 66% less likely to outperform financially.

 

With such a huge missed opportunity for scaleups and for UK growth, we need to look at the structural challenges that remain. It makes business and economic sense to educate and encourage more women into both senior leadership and investing. Increasing female angel participation in the investor community could help address the ongoing imbalance in the capital available to female founders and their early-stage businesses.

 

 

Improving early-stage investment decisions

The UK Business Angels Association reports that the UK angel base has grown 54% since 2022. However, this growth hasn’t been accompanied by balanced participation in terms of gender, lowering diversity of thought in investment circles.

 

Investment decisions are shaped partly by the experiences, professional networks and sector knowledge that investors bring to the table. More female angels could improve deal sourcing and early-stage investment decisions by bringing different experiences, networks and ideas into investment discussions.

 

Female angels can also give female founders a strategic advantage when they have direct experience of the markets, customers or operational challenges involved. This isn’t determined by gender alone, but a more diverse investor base increases the likelihood that founders can access the relevant expertise and capital that they need to scale.

 

Growing and scaling a business after initial launch can often be the most challenging stage for founders. Increasing the pool of investors available to female founders during this period should widen access to funding, advice and strategic contacts.

 

 

Removing barriers to participation

Many women with the ability and financial capacity to become angel investors are undoubtedly prevented from doing so at present due to structural reasons. These include a lack of relevant information provided by the financial advice community, and breaking into a male-dominated field can be challenging in any sector.

 

Another significant issue is that angel investing depends heavily on formal and informal networks, which help drive introductions and potential deals. When women don’t have frequent access to these networks, they’re less likely to consider investing altogether.

 

Initiatives such as Women Who Scale, part of the wider SCALE platform, and partners like XX Invest, can help connect prospective angels with experienced investors and founders seeking capital. The value comes from more than networking. These communities can provide access to investment opportunities, relevant expertise and trusted peers, helping women move from an interest in angel investing to active participation.

 

Addressing the gender gap among angel investors isn’t just about fairness. Greater diversity within the group is in the UK’s business interests as it can help achieve a balanced and high-performance early-stage investment ecosystem. It’s an economic opportunity, not a chance to point fingers at why the numbers are still so low. Creating clearer routes into angel investing will help more women participate and more promising companies secure the backing needed to scale.

 

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Amy Knight is Communications Director at SCALE and Co-founder of Women Who Scale

 

Main image courtesy of iStockPhoto.com and Bulat Silvia