Entrepreneurial Women Need Disruptive Financial Models

Diana Project 2020
Listen

Entrepreneurial women are a significant force in the U.S. economy, now equal or majority owners of 45% of all U.S. firms.

Yet, most have difficulty raising growth capital, and new models of funding are needed, according to the new Diana International Impact Report.

“We need to create and support new models of funding for women entrepreneurs because their access to growth capital is a serious and continuing problem,” says Diana International Impact Report co-author, Babson Vice Provost of Global Entrepreneurial Leadership Candida Brush.

Less than 15% of all VC-funded businesses have one woman on the team, less than 3% of all VC-funded companies have a woman CEO, and more than 92% of all investors are male, according to the most recent Diana Project research.

“Investing in women entrepreneurs is an opportunity to expand innovation and economic development. We should create a new reality for the process and benefits of investing in women entrepreneurs,” said co-author and Babson Entrepreneurship Professor Emerita Patricia Greene, formerly director of the Women’s Bureau, U.S. Department of Labor.

This call for new funding models for entrepreneurial women and documentation of the continued disparity in funding by gender is reported in the new Diana Report. It advocates a new funding direction by identifying disruptive funding models and best practices for women entrepreneurs across each of the six primary processes that drive entrepreneurial development: identifying, training, connecting and sustaining, funding, enabling public policy, and celebrating.

Diana International Impact Report

Identify

The report calls for refinement of the pipeline processes that already exist and the creation of new funding models for entrepreneurial women that differ from the conventional VC model.

Train Investors

Training women investors can open the funding tap to allow a new flow of capital into women-owned and -led businesses and a growing number of companies.

Examples of training vehicles include 500 Startups, which offers VC Unlocked as an executive education program for those who want to learn “how Silicon Valley really works,” and 37 Angels, which is building a community of women investors with a mission of educating early-stage investors.

Connect and Sustain

Accelerators focusing on women founders provide opportunity for female entrepreneurs to access resources, including their networks, thereby increasing chances of accessing growth capital in the future.

Approximately 30 women-focused, startup accelerators and incubators in the U.S. provide training, support, and funding, including the Women Innovating Now (WIN) Lab® at Babson College, Aviatra Accelerators, Founders for Change, The Riveter, and The Wing.

Fund

Venture capital firms need to hire more female decision-making investors.

There needs to be intentional action by the top venture capital firms to reach outside their current network into other networks to acquire female investors.

Additionally, new funds are growing a more inclusive focus on both the supply and demand side—more women providing the funds and more women receiving them. This both expands the number of women investing and potentially diversifies the types of businesses selected for investments. Examples include Victress Capital, XFactorVentures, Portfolia, Golden Seeds Venture Fund, and Plum Alley.

Public Policy

Advocacy organizations, including the National Women’s Business Council, are catalyzing new ideas, encouraging change and providing policy support to address diversity, startup, growth, and funding of high-growth women entrepreneurs with a range of definitions of what constitutes a successful outcome.

Celebrate

It is important to celebrate, advocate, and provide visibility for accomplished women entrepreneurs, funding successes, and outstanding performance.

Storytelling becomes a vehicle for creating role models and giving women confidence and permission to grow and scale. One such initiative includes collaborations between Estee Lauder Companies, Nordstrom, UGG, and Williams-Sonoma Inc., which are realizing the power of partnerships by coming together to raise the profile of women leaders across global supply chains through the “This is a Leader” campaign, coordinated by Business for Social Responsibility’s HERproject. The Tory Burch Foundation also is a major catalyst in amplifying the visibility of women entrepreneurs through its Embrace Ambition series and corresponding Ambition Stories campaign.

The report was sponsored by the Center for Women’s Entrepreneurial Leadership (CWEL) at Babson College and was developed during the June 2019 Diana International Impact Day event hosted by Babson College.

Posted in Community, Entrepreneurial Leadership, Insights

More from Insights »

Latest Stories

a row of electricity meters
The Price of Power: What’s Driving Rising Electricity Rates? Electricity rates have been steadily increasing. Ryan Davies, a Babson professor of finance, unpacks the many reasons for that, including the massive data centers popping up across the country.
By
John Crawford
Senior Journalist
John Crawford
A writer for Babson Thought & Action and the Babson Magazine, John Crawford has been telling the College’s entrepreneurial story for more than 15 years. Assignments for Babson have taken him from Rwanda to El Salvador, from the sweet-smelling factory of a Pennsylvania candy maker, to the stately Atlanta headquarters of an NFL owner, to the bustling office of a New York City fashion designer. Beyond his work for Babson, he has written articles and essays for The Philadelphia Inquirer, Notre Dame Magazine, The Good Men Project, and other publications. He can be found on Twitter, @crawfordwriter, where he tweets about climate change.
September 30, 2025

Posted in Insights

The Babson community and mascot celebrate at the Roger Babson statue last year
No. 2 Again: Wall Street Journal Ranks Babson the No. 2 Best College for the Second Year in a Row For the second year in a row, The Wall Street Journal ranked Babson as the No. 2 Best College in the United States, lauding the College for its impressive student outcomes.
By
Eric Beato
Editor / Writer
Eric Beato
Eric Beato is the Editor of Babson Thought & Action and Babson Magazine. A native of Chicago and a graduate of the University of Missouri School of Journalism, Eric has worked as an editor and writer at newspapers across the country, including the Chicago Sun-Times and Boston Herald. Eric joined Babson College in 2019 after working as the communications director for a private educational travel company and as the managing editor of six regional sports publications.
September 29, 2025

Posted in Community, Entrepreneurial Leadership, Insights, Outcomes

First row (left to right): Laura Bautista ’29, Ezel Bhatty ’29, Sydney Fojas ’29; Second row (left to right): Lucas Lebrija ’29, Tia Malhotra ’29, Remy Witt ’29
Class of 2029 Blank Leadership Scholars Bring Excitement to Campus The Class of 2029 Blank Leadership Scholars arrive at Babson equipped with entrepreneurial spirit and social impact experience, from launching nonprofits and tech solutions to championing environmental education.
By
Melissa Savignano
Writer
Melissa Savignano
Melissa Savignano, a content marketing manager at Babson College, has worked in higher education for almost a decade, where she tells authentic, compelling campus and community stories. Before Babson, she managed communications for Boston University’s largest college, the College and Graduate School of Arts & Sciences. She previously worked in client relations, helping brands of various sizes launch content marketing strategies and storytelling initiatives. When not at work, you will find her in the city of Boston, probably at the movie theater.
September 25, 2025

Posted in Community