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How Impact Investing Is Fuelling Women Entrepreneurship A promising trend in recent times is the rise of funds and venture capital firms that are led by women and invest in women, thereby aiming to bridge the gender gap both in entrepreneurship and the investment community at large

By Soumya Duggal

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As G20 Chair, India has identified women-led development as one of its high-priority subjects, said Prime Minister Narendra Modi at the 108th Indian Science Congress (ISC). That was right at the beginning of 2023. Since then, several such statements highlighting the importance of women empowerment have come in from the likes of Finance Minister Nirmala Sitharaman and G20 Sherpa Amitabh Kant. Most recently, India has contributed $500,000 to UN Women—United Nations Entity for Gender Equality and the Empowerment of Women.

From STEM education to corporate leadership to entrepreneurship, a conscientious effort is being made by decision makers across the public and private sectors to ensure that women not only benefit from the country's overall progress but also direct it from the forefront. In the startup ecosystem, this has translated to efforts aimed at impact investing by women investors in women-led ventures.

By Women for Women

According to Reinu Shah, the founder and CEO of a women-focussed incubation and accelerator program called STEP, the catalyst to starting an initiative for women was a bunch of early experiences in her own entrepreneurial career: "Not only did we, as women professionals, face certain biases and discriminations that we lacked even the vocabulary to articulate at the time but there also existed a sheer dearth of a community of women to share difficulties as well as successes amongst each other."

While STEP has so far incubated 65 women-led startups, which have raised INR 50 lakh through the program and more than INR 25 crore as follow-on funding, the not-for-profit organisation aims to reach 10,000 women by 2030 and touch 10 million lives through its work. It recently formed a partnership with FICCI FLO, Asia's largest women's chamber of commerce and industry organisation, to further empower Indian women entrepreneurs.

Bridging the Gender Gap

A promising trend in recent times is the rise of funds and venture capital firms that are led by women and invest in women, thereby aiming to bridge the gender gap both in entrepreneurship and the investment community at large.

According to the 'CXXO State of Women Entrepreneurship Report 2023', unveiled by Kalaari Capital managing partner Vani Kola earlier this year, investor support is the most important factor (43.4 per cent) to enable women's entrepreneurship and yet, only 1 per cent of funding is received by women-led startups, and 15 per cent of Indian unicorns have female co-founders—only two are led by female CEOs; moreover, the share of VC funding by women is just 9 per cent, and only fewer than 1 per cent of active angel investors in India are women.

The CXXO Program is a Kalaari Capital-backed initiative aimed at leveling the playing field for Indian female founder-CEOs by solving early-stage funding bias, offering need-specific learning and support from industry leaders, and building a tribe of women leaders. Thus far, the initiative has announced $10 M in funding. Similarly, New Delhi-based She Capital is a fund for early stage female founders, which has roped in over 3500 women entrepreneurs in its community till date. Led by Anisha Singh, former CEO, mydala.com and president, South Asia, Cartier Women's Initiative, the INR 100 crore maiden fund has invested in startups such as Clovia, Samosa Singh, ELEV8 and Spark Studio.

Notably, Bengaluru-based VC Ankita Vashistha has so far set up two funds investing in India and the US as well as certain locations across the UK, Europe, MENA, etc., and Southeast Asia: $10 million Saha Fund to empower women as entrepreneurs, employees and consumers and $1 billion StrongHer Ventures to be the first global early-stage venture fund to apply a gender lens to investing. Her thesis also includes investing in sectors that are likely to empower women in the future, including fintech, healthcare, consumer and Web3. "With the emergence of Web3, it's a whole new ecosystem that can be built by women," Vashistha has said in the past.

Soumya Duggal

Former Feature Writer

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