Why Women Led Start-ups Have a Leg Up Over the Competition

(Patricia Maher is the founder and CEO of FuhWe, and will be exhibiting at Collision as part of the ALPHA Program. We asked Patricia to share what it means to be a female founder, and how Collision is supporting women through their platform.)

The Fortune 500 has 480 male CEOs, and 20 female CEOs. That’s not a typo, or a statistical error, or a fluke. But it is a problem – particularly for those that want businesses to succeed. The simple fact is that female leadership is an essential part of growing a successful company.

Google Search for Male LeadersThere are a variety of reasons people offer for the wide gender gap among corporate leadership. Some blame unfair standards or a lack of readiness by companies to deal with female leadership. Others simply hand-wave it as a glass ceiling issue. Heck, do a Google image search for “male leaders”, and the #2 image is a man smacking a women over the head with a folder. If that wasn’t bad enough, the image is actually labeled on its stock image site as “Strict Chief and Young Worker.” When workplace violence gets labeled as strict, there might be a cultural issue we need to solve.

But let’s get beyond that. As a start-up, we’re all about problem solving (rather than staring at the problem frustratingly.) So we’re here to show you why female leadership is not only important, but essential to a strong business.

As a founder, you decide alone. But no one is alone.

Start-ups tend to be one or two person shows at the beginning, but that period of time if incredibly short. If you’re doing well, you’ll be surrounded by potential investors, employees, and interns in no time. When your team begins growing, it becomes increasingly important for a founder to work strongly in a team. Being a superstar as an individual will only get you so far. And this is where being female starts to show its strength. A study published in The Economic Journal shows that women are much more competitive when working in teams than men. If you’re serious about growing, then better teamwork tends to be priority #1.

As an investor, you want your money makin’ money.

Investors do their job for one purpose: to make more money. What’s ironic, then, is that their ignorance (whether conscious or unconscious) is leading to poorer performers. A study from the Kaufman Foundation found that not only did women-led tech startups that received funding achieve 35% higher ROI than male-led companies, but they also had 12% higher revenue. Those are metrics that every VC should be thinking about when they meet a company’s founding team.

FUHWE Blog Womens - Higher ROI

Why might these company’s be performing better? A study in 2012 by Ponemon showed that women actually do work harder. Ask any founder what you need to start a company, and it’s a lot of work and a little luck – having a women executive means you at least have the first part down.

Women Don’t Throw Away Their Shot

FUHWE Blog Womens - More ProfitabilityEven if you ignore the power of team-building, ability to grow businesses’ revenues, or their harder work ethic, the most calculated decisions still end up revealing the strength of female led companies.

  • A study by the Peterson Institute for International Economics found that “having more women in overall executive positions was tied to greater profitability.
  • According to DDI, there is worldwide “evidence that recruiting and promoting women will drive high performance.”
  • A McKinsey & Company study found that advancing women’s equality can “add $12 trillion to the global GDP” in the next ten years.
  • VC Firm First Round, found that after looking at all of their investments, “companies with a female founder performed 63% better than [their] investments with all-male founding teams.”
At the end of the day, numbers don’t lie. If you want a business to be successful, then you want that business to have female leadership as well.

Who Else Has Realized This?

Good question! One of the reasons we’re so excited for our company, FUHWE, to be a part of Collision’s Alpha Program this year, is that the conference has dedicated itself to improving the opportunities available to female entrepreneurs and start-up leaders.

From providing free tickets to female founders, to bringing in some of the top woman leaders – we’re looking forward to sharing our own female-fronted team at FUHWE with the rest of the world in April. We hope to see you there!

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