Exciting developments are happening worldwide as more investments are being made in female-led fintech startups in 2024, signaling progress in the industry.
The expansion of female-led fintech startups in 2024 can be supported by:
1. Encouraging women to be more confident and overcoming any imposter syndrome and social norm issues
It’s important to acknowledge that societal norms can often make women feel like they lack the confidence to start or expand their businesses. Research from Natwest UK has shown that 60% of women who considered founding their own business didn’t pursue this dream due to a lack of self-belief.
However, the Rose Review discovered that even though there is no actual difference in capability, only 39% of women feel confident as entrepreneurs compared to 55% of men. This can be overcome by:
1) Empowering women to openly discuss imposter syndrome can lead to a more supportive entrepreneurial environment.
2) Recognizing and celebrating achievements, no matter how small, is essential in combating imposter syndrome.
3) Building a strong support system with mentors, coaches, and like-minded individuals is crucial for female entrepreneurs facing imposter syndrome.
4) Boosting confidence and overcoming imposter syndrome can be achieved by women through investing in continuous learning and skill development.
Attending workshops, conferences, and enrolling in relevant courses are encouraged as they contribute to expanding knowledge, enhancing skills, and reinforcing expertise.
2. Engage with a co-founder: female-led startups are more likely to gain funding when they have a Co-Founder, male or female.
Studies indicate that companies led by male founders or co-founders tend to secure significantly more funding compared to those led by females. This has resulted in a substantial disparity in the amount of investment received by female-led businesses, with all-female founder teams receiving a mere 2% of total equity investment.
Consequently, there exists a considerable disparity in both the quantity and quality of funding obtained by businesses based on the gender of their founders. Overcoming this challenge is crucial for female entrepreneurs, and having a co-founder can greatly enhance their prospects of securing financial support, thereby narrowing the existing investment gap.
In addition, having a co-founder with complementary skills can help you expand your network and access to funding sources. For example, if one of you has strong connections in the investment community, you can use these connections to raise funds and to find the right investors for your business. Starting a business with a co-founder can provide entrepreneurs with many benefits, including sharing the workload, emotional support, better decision-making, stronger teamwork, and access to resources and connections.
3. Collaborating with established financial institutions and forming strategic partnerships can provide female fintech startups with valuable resources and expertise.
By forming partnerships with financial institutions, fintech startups can enhance the reliability, security, and compliance of their services while also benefiting from the established trust and reputation of well-known brands.
Nevertheless, collaborating with financial institutions may present obstacles like aligning goals, expectations, and cultures, negotiating terms and conditions, and integrating systems and processes. Collaboration can take many forms:
1) By associating with reputable events or organizations, fintech firms can enhance their brand credibility.
2) Collaborating through partnerships and sponsorships provides fintechs with networking opportunities to connect with other businesses, industry leaders, and potential clients, leading to new business prospects and strategic alliances.
3) Through partnerships and sponsorships, fintechs can differentiate themselves in a competitive market by associating with unique or exclusive events or causes, attracting attention and standing out from competitors.
4) Engaging with the community by actively participating in local activities or joining community groups, a company demonstrates its commitment to making a positive impact and supporting the community.
4. Investing in continuous research and development can enable female fintech startups to stay ahead of the competition and offer cutting-edge solutions.
Research and development quickly becomes outdated. Achieving success attracts attention, drawing interest from customers and competitors alike. Without ongoing innovation, a stagnant product line leaves room for rivals to surpass you and push you out of the competition, especially when facing well-funded, innovative companies like unicorns.
To stay ahead in the fintech industry, companies must excel in strategic R&D investments that yield tangible outcomes and swiftly introduce new technologies to the market. This necessitates a persistent commitment to research and development to ensure continued competitiveness.
5. Participating in industry events and conferences can help female fintech startups network with potential investors and industry leaders.
Exploring new possibilities: Building connections can lead you to uncover fresh opportunities for development and advancement. Engaging with potential clients, collaborators, backers, and advisors can propel your business toward greater success.
Networking offers the opportunity to connect with seasoned entrepreneurs and industry leaders, enabling you to establish meaningful relationships and gain valuable guidance and support.
6. Female entrepreneurs from non-finance and tech industries can use embedded finance to access capital and enter fintech.
Companies can develop cutting-edge products and services by utilizing embedded finance, offering customers enhanced convenience and value while staying ahead of competitors in the fintech industry.
To fully benefit from the expansion of embedded finance, companies must promote diversity within their teams, including more women in leadership roles, as studies show female-founded startups tend to have more diverse team compositions.
Investors and businesses have a strong motivation to support embedded finance initiatives that provide funding opportunities specifically for female entrepreneurs, contributing to a more inclusive and innovative financial landscape.
On a final note, initiatives such as the AccelerateHER Awards highlight the importance of promoting female-founded companies in sectors like fintech, showcasing the potential for success and inspiring others to follow suit. By supporting women in leadership roles, these programs contribute to a more diverse and thriving industry landscape.
The fintech sector offers a promising outlook amidst economic uncertainties, with opportunities for growth and innovation. Encouraging greater female participation and empowerment in this field not only benefits individual companies but also contributes to the overall success and competitiveness of the sector on a global scale.
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This articles is written by : Fady Askharoun Samy Askharoun
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