Entrepreneurship, Does it Have a Gender?

By Elena Bou, Innovation Director, EIT InnoEnergy

Women constitute 52% of the European population, but for every 10 male entrepreneurs, there are only 7 women. While Poland, Slovakia and Hungary report high percentages of female founders (above 20%) overall, no country in the EU or North America shows gender parity. When considering the number of women entrepreneurs in sustainable energy, the percentage falls to around 10%. 

Traditional gender roles, driven by cultural and social norms, contribute to misperceptions of women’s abilities and limits their presence in renewable energy. Views about gender roles tend to translate into lack of access to career information and relevant networks. This reality also shapes hiring practices, affecting all levels of positions, from internships and apprenticeships, to the boardroom. Conversely, in countries such as Sweden, where there is a concerted effort to reduce gender inequality, there is a noticeably higher percentage of women entrepreneurs. 

Gender inequality is a worldwide problem – no country has an equal share of male and female entrepreneurs. Can we afford to waste this talent? 

In our own study of the 400+ supported companies in our portfolio, we found that just 15 per cent are led by women entrepreneurs, slightly above the European average. Promisingly, when reviewing the technologies and markets that our women entrepreneurs work in, the sample was diverse – from smart buildings, energy efficiency and storage to renewable energy and fuels. 

In our study we found that many women entrepreneurs were incentivised to take this career path by a lack of opportunity to develop elsewhere or the desire to have a positive societal impact. 

When asked about the main barriers to starting out, access to social capital was the most commonly quoted hurdle. Most successful female entrepreneurs build networks from day one and demonstrate a pro-active attitude towards it. 

Conversely, access to finance was not perceived as a barrier. Our research led us to believe that women entrepreneurs often lean on their family for funding but that they are also more effective at raising funds in face-to-face meetings for example when applying for a bank loan. 

One of the issues we want to shed light on is whether entrepreneurial competencies differ between gender. Using our Talent Due Diligence tool we screened the entrepreneurial competencies of more than 800 start-up members from the sustainable energy field. The results were clear. There are no significant differences between females and males; they score almost equally on most competencies. 

Being an entrepreneur doesn’t have a gender. You are simply an entrepreneur. However, it is one thing to have the right attributes, and another to have the opportunity to develop them. It is possible that a woman, for different reasons, encounter barriers that makes it more difficult. 

Figure: Overview of the results from our Talent Due Diligence tool assessing individual entrepreneurial competencies 

Our study also revealed: 

• Our entrepreneurs are not risk averse.
• Women scored higher on transformational leadership – being a positive and inspirational influence on other members of the team. Transformational leadership is often considered positive, but experts warn about the need to manage the time invested in this activity strategically in early-stage start-ups.
• Women felt less confident when they graded themselves on entrepreneurial self-efficacy. They are more confident than men in management skills, but less confident in financial skills.

The light at the end of the tunnel

We are convinced that mobilising our European talent for innovation and entrepreneurship in sustainable energy will have a positive impact on solving our society’s energy challenges. 

Despite the low number of women entrepreneurs in sustainable energy, the context is promising. Our energy market is changing, new business models are appearing, and the citizen is taking a central role in the energy and climate change agenda. This new context requires high doses of creativity, high-potential and diverse teams and a multidisciplinary approach to face energy challenges. Today such diversity is crucial, as it is the seed of the creative abrasion that will give birth to innovation. And we need a lot of diversity in the sustainable energy industry…diversity of background, culture, age and…gender.