Happy International Women's Day! Today is the day to highlight women and their contribution to society. Despite the barriers that many have and continue to experience, women have acheived so much especially in the world of business.
This Women's Day we're giving a sneak peak of the next A Quick Ting On book; Black British Business by Tskenya-Sarah Frazer. In her debut book, Frazer examines the day-to-day struggles, triumphant success stories, and unique circumstances. A Quick Ting On: Black British Businesses takes you on an informative journey through the history (and future) of Black British entrepreneurship.
See below for a snippet of Chapter 3 - Sisters, doing it for themselves; Black Women in Business:
In 2017, former Chancellor of the Exchequer Philip Hammond commissioned a report undertaken by the British Business Bank in partnership with Diversity VC and the BVCA to identify the issues women-led firms were facing. The UK VC & Female Founders Report which was later published in 2019 highlighted just how bad it was in these streets for women founders. I knew it would be bad but even I was shocked by just how bad it really was.
The report found that all women founder teams in the UK ranked lowest when it came to raising capital. For every £1 of venture capital (VC) investment, women founder teams attained less than 1p whilst, male founder teams received 89p and mixed-gender teams secured 10p. To add insult to injury, 83% of deals that UK VCs made in 2019 had no women on the founding teams.
Just as bad was the fact that 75% of all pitch decks that reached the VC firms had no women on the roster. The report also revealed that founding teams with at least one woman were less likely to get follow-on funding. 53% of teams with at least one woman got a second round of funding compared to 61% for all-male teams—and this difference persisted in each subsequent round. Then to top it off, teams with more women than men tended to receive unwelcoming and cold receptions from investors. Delightful!
There was one dimmed glimmer of hope in the report—venture capital investment for women founded start-ups were slowly increasing. However, for all-female teams to reach even 10% of all deals it would take roughly 25 years—so we are talking 2045 to see any real improvement. It is rough out here!
The 2019 UK VC & Female Founders Report, by the British Business Bank, focused solely on the intersection of being a woman in business. So, what would the statistics look like if race was added into the mix? Black founders, specifically Black female founders are held back by an additional barrier which is often referred to as the ‘Black tax’.
Originally founded in socio-racial theory, the phrase ‘Black tax’ was initially used to describe how race coupled with social-class robs an individual of their ability to build wealth from the moment they are born. The term is used to cover a variety of social and economical issues that impact Black people. It covers the way Black professionals are culturally expected to give prodigious financial and emotional support to family members. The way in which deep seated structural racism perpetuates a cycle of inequality such as lower pay and a lower standard of education for Black communities. It even extends to the way in which Black people are perceived as: ‘less credible, less productive, less intelligent, less trustworthy, less sensitive, less deserving of respect, less human, just all-around less.’
‘The Black Tax’ means that there is an inherent fear of investing in businesses led by Black people, namely Black women. Investors often hold these businesses to a higher standard than those founded by white men. Even once Black women appear to knock down the doors, they are detained at the threshold and denied entry. This pattern sees Black women having to go the extra mile to prove their value and worth in a way that their counterparts do not—this might include them having to get additional education, research and years of experience in order to mitigate the barriers set against them. 85% of the Black founding women I have spoken to whilst writing this book have been able to recount moments where their Black womanhood worked against their entrepreneurial endeavours. For example having male members of the team deliver pitches so the company could be taken seriously all the way to women founders being mistaken for ‘the assistant’ at trade shows and events.
Over the past decade, across all the vast global pools of tech only 0.006% of funds have been granted to Black women founders. This comes as no surprise, as psychologically people are drawn to those who they have more in common with which means investors are more likely to invest in those who share commonalities with them—which is usually other straight, ‘educated’ white men.
Before we continue, let me let you in on a secret about myself. I have a kink. Well kind of. My kink-ish is that in my spare time, I like to find a company, scour trail Companies’ House (United Kingdom’s registrar of companies), research its founder, and find out how they built their business. Interviews with white male founders are my personal favourite, I usually save them for weekday evenings when I need something I can easily fall asleep to. You often get the typical ‘I had to work hard, my dad gave me £20,000 to prove the concept of X’, ‘my uncle is a successful business man with a respectable portfolio of Y’, ‘whilst studying at Oxford I met my business partner whose parents owned Z and they guided us’ or sometimes, quite audaciously, some bozo who thinks he is the next Walt Disney but wants to sell water at pH5 tells the world, ‘my last business failed but this time I had a better idea, and they believed in me and trusted that I would make a return on the investment because of my passion.’
Discover the interviews and history in A Quick Ting On: Black British Businesses when it is out on 20th April 2023. Preorder your copy here!