Female-founded businesses receive 2% of venture capital funding (British Business Bank, 2023), demonstrating a gender investment gap. Furthermore, Extend Ventures Diversity Beyond Gender 2023 report states that Black women founders raised 0.14% of investment between 2013-2023. The report also found that the entrepreneur’s ethnicity impacts their success rate of receiving venture capital, with minority groups such as Black and South Asian founders being less likely to receive venture capital than their White counterparts (Diversity Beyond Gender, 2023). In the last 10 years there has been no improvement in the investment female founders have received (British Business Bank, 2023), suggesting that current and previous interventions have not proven successful. 

This research will examine the role of digital technologies, both present and future, in entrepreneurial investment and how this may enhance or hinder the current challenges in the entrepreneurial investment industry. The main research question the project intends to answer is ‘How do digital technologies influence the gender and race investment gap?’ The key objectives are:

• To create a framework that demonstrates a relationship between the root causes, consequences and interventions. 
• To determine effective digital interventions to reduce the investment gap. 

The research will use a mixed methods approach. The qualitative data collection will involve semi-structured interviews with the different stakeholders involved in the entrepreneur’s investment ecosystem. The purpose is to gather in-depth insights into these stakeholders’ experiences. The quantitative data collection will be a network analysis of where entrepreneurs receive investment from. 

The value of this research is to understand what digital technological interventions can improve this issue. I will contribute academic insights into how interventions using technology can improve the investment gap. The research can be used by designers of the technology to implement the design recommendations or digital tools needed to make the investment process fairer for all entrepreneurs. This implementation will benefit entrepreneurs who currently face discrimination in the investment process such as females and women of colour as it aims to reduce the bias. 

References:

British Business Bank (2023) Press Release - July 5, 2023. Available at: https://www.british-business-bank.co.uk/press-release/british-business-bank-report-reveals-no-improvement-in-the-share-of-venture-capital-investment-to-female-founder-teams-over-the-past-decade/ (Accessed: 6 March 2024).

Diversity Beyond Gender (2023). Available at: https://www.extend.vc/_files/ugd/446c2c_2545bfc7323646fa8d757ea8a2ac2a10.pdf (Accessed: 6 March 2024).