Africa’s women-led startups are struggling to find investors

Women-founded companies have received less than 5% of venture capital funding in Africa over the past decade, according to a new report. According to the report, investment in women-founded companies continued to decline last year, frustrating businesswomen and those who want greater consideration from investors.

According to the report by business research platform Briter Bridges and non-profit organization V54 Open Impact, women-founded companies are the driving force behind innovation and inclusive growth in Africa. However, these companies face many challenges when seeking investments.

Akosua Lefty, a Ghanaian businesswoman who specializes in developing natural hair products, said she had struggled to attract interest from potential investors in her two years in business.

An investor will express interest and then never reach out again, she said, or they will want to make money right away, which may not be possible.

Briter Bridges and V54 Open Impact say less than 5% of total venture capital funding across Africa has gone to female founders in the last 10 years.

Elizabeth Mwangi, founder of Gwiji, which connects cleaners with customers, received her first funding in 2020, which helped her develop an app that could support and empower women to make a living.

She said the next funding she received was in 2023, when she almost gave up on Gwiji. She received the Aurora Tech Award, a global award aimed at women. She was then able to receive $30,000 in funding, which enabled the company to open an office and start secondary programs to help women.

Mwangi said she is working with other organizations such as the British government-backed Transform to expand her reach beyond Nairobi.

The aim, she said, is to empower more women from informal settlements because every day she receives calls from women all over 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 greater challenges that go beyond funding, including gender bias, lack of access to support networks, culture and political changes.

Lefty said she is willing to be patient and build a business that can meet the challenges of being a woman.

Mwangi and Lefty urge other women entrepreneurs not to be discouraged, but to build businesses that help solve societal problems and to continue to seek opportunities and investors to support their dreams.