It’s not me, it’s you: Unconcious investors bias is holding back female agri entrepreneurs

“I feel [it is] a little bit lazy on their part to just say it's a pipeline problem. Because our data has clearly shown that there is sufficient interest from women, so it’s a bit more complicated than that,” Balathasan told EURACTIV. [SHUTTERSTOCK]

A number of female agri entrepreneurs are not able to tap into their potential and scale up their businesses due to an unconscious bias among investors, according to Lukxmi Balathasan, business creation manager for EIT Food, who said that this results in a worse outcome for all. 

The role of women in the agricultural sector has been increasingly at the forefront of discussions on sustainability.

But while many are making all the right noises, there are still a number of barriers in the way for women to scale up their businesses.

Conversations on tackling this problem often centre on training and education, and finding ways of encouraging women to enter the ‘field’.

But while this is important, this does not necessarily reflect the true barriers that prevent women entrepreneurs from taking their businesses to the next level, according to Lukxmi Balathasan, who stressed that it is not a pipeline problem.

“Women are starting to come through more and more in the agrifood and health space,” she told EURACTIV in an interview, highlighting that there is often a personal passion for food issues alongside a high technical skill-set.

Pointing out that there is high engagement in programmes run by EIT Food, such as the upcoming Empowering Women in Agriculture networking event, Balathasan said she does not “really know what investors mean by pipeline problem”.

“I feel [it is] a little bit lazy on their part to just say it’s a pipeline problem. Because our data has clearly shown that there is sufficient interest from women, so it’s a bit more complicated than that,” she said.

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It’s not me, it’s you

Balathasan put this down, in large part, to a clear, but unconscious, bias of investors when it comes to women entrepreneurs.

“I was shocked to see how differently the investors treated [women],” she said, pointing to anecdotal evidence where investors clearly “didn’t know how to interact with a woman.” 

According to a recent EIT Food female entrepreneurship survey, 83% of female entrepreneurs said they had experienced a negative gender bias while pitching, while 97% suggested that training was needed for men to tackle the problem.

As such, to ensure equal access to funding opportunities, Balathasan pointed out that women entrepreneurs are increasingly highlighting the need to “fix the men, not us”.

“Women are often saying to me ‘stop coming to us for the problems – it’s better to engage with men in decision making’, it’s better to establish standards to tackle their biases,” she said. 

Tackling this is a challenge, but Balathasan said she was encouraged to see that some associations, such as the British Venture Capital Association, had taken up the important task of adding diversity and inclusion to their training for the next generation of venture capitalists, ensuring that more women are in decision making roles. 

“This is important, because women investors are more likely to invest in, or take a chance on, women,” she explained. 

Economic sense

And this diversity is not just a “nice thing,” but actually makes concrete economic sense, she pointed out.

“The impact of not giving women equal access to technology and funding actually has a detrimental impact on outcomes of innovation,” she said, pointing to evidence from the UN’s Food and Agriculture Organisation (FAO) that suggests that several million more people would be fed if women had more access to resources to take on the roles in the agrifood chain. 

She added that more diversity also often results in a stronger economic return, as evidenced by numerous studies, but that, despite the evidence, this narrative is not enough to push investors to back women entrepreneurs. 

“Obviously, the return on investment is great. But even with the statistics published 10 years ago, which show that women are a better bet – it’s not changing anything, and that’s crazy because you would think that would be your only metric that’s a value,” she said. 

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Accountability and data

According to Balathasan, there is a big window of opportunity to make an impact from a European policy standpoint in terms of accountability. 

She said venture capitals can have metrics in place to get help and help the startups be more inclusive.

“But then who is holding them accountable, saying that they need to be deploying funding in a more equitable manner?” she queried, saying that she would “love to see” something from the European Investment Bank or the Environment Investment Fund. 

Specifically, she said there was a need for a deeper understanding of the metrics they use to decide who to give money to and the type of women startups getting funded.

“Because what I’m talking about is bottom-up, the training, the nurturing, the mentoring. And then from a policy approach, this has to be top-down. We need to marry the two to see any real change,” she pointed out.

“I can work with a really great cohort of entrepreneurs and investors. But until there are more women fund managers, and there’s more metrics being put down on VCs, that they need to diversify their portfolio, they’re not going to take the necessary steps,” she concluded.

[Edited by Zoran Radosavljevic]

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