Pathways: A new approach for women in entrepreneurship

An independent review into women in entrepreneurship in Scotland, authored by Ana Stewart and Mark Logan. Based on thorough data analysis and stakeholder engagement the report's recommendations seek to address the root causes of female under-participation in entrepreneurship.

Appendix A: Summary of research into under-participation

In this appendix, we summarise the research approach taken in producing the report. We also provide key statistics, including those referenced elsewhere in the report.

Research Approach

This report was informed by a combination of research sources and approaches, which we can summarise as anecdotal and systematic.

Anecdotal Sources

We directly consulted with over 200 stakeholders from multiple areas of the entrepreneurial ecosystem, including the Scottish Government and its agencies, multiple action groups, investment firms, accelerator and incubator programmes, schools, colleges and universities.

We systematically surveyed female entrepreneurs (see Appendix E) and we further conducted focus groups with many female entrepreneurs, from all stages of the entrepreneurial journey. We also sought the views and perceptions of male entrepreneurs toward the focal areas of this report.

In preparing this report, we took into account the findings of prior notable reports into under-participation in entrepreneurship, including the Mastercard Index for Women in Enterprise[103], and the Alison Rose Review[104] as well as a range of academic papers, including those by Norin Arshed[105] and Sara Carter[106].

A full list of references are provided in Appendix F.

Summary of Statistics Relevant to the Report

Disaggregated data analysis for Scottish companies.

As was noted in Chapter 9, investigation into under-participation in entrepreneurship is hampered by a lack of systematic, comprehensive and reliable company data, disaggregated by gender and ethnicity. To address this deficiency, we engaged with the organisation, mnAi, with support from Prof. Eleanor Shaw, University of Strathclyde has constructed a detailed and dynamic directory of entrepreneurial activity across the Scotland, utilising over 10 billion datapoints. This model has been used as the basis for the analysis in this report. The data is current up to to 21st December 2022.

Company incorporations

Headline figures on the number of female led[107] companies appear positive on first sight, with 8,103 new companies incorporated[108] in 2022[109]. However, this progress cannot be fully assessed without considering also the overall number of new companies – 39,258 in the same time period. Doing so shows that female-led companies account for 1 in 5 company incorporations.

Company Incorporations by Gender over last 5 years
A pie chart showing Company Incorporations by Gender over the last 5 years in percentages: Male-led 62%; Female-led 19%; Gender-even 14%; Unknown 5%.

While there has been welcome growth in the number of new female-led companies year on year, compared to the 2,359 incorporated in 2018, there still remains a clear and persistent gap when compared to the total number of company incorporations.

Company Incorporations by Gender
Line graph illustrating company incorporations by gender over a 5 year period from 2018-2022. Male-led company incorporations are considerably higher than female-led, gender-even and unknown. Male-led incorporations increased over the 5 year period from 8840 to 24884. Female-led gradually increased from 2359 in 2018 to 8103 in 2022. Gender-even remained relatively constant around 2018-2021 at around 3000 with an increase to 4919 from 2021-2022. Unknown is showed a slow increase over the five year period from 634 in 2018 to 1622 in 2022.

There has been no material change to the gender gap in the last 5 years with the gap between male and female led companies at 43% in 2022. There has also been a noticeable decrease in the share of companies started by 'gender-even' teams.

The Gender Gap

Company Incorporations by Gender
Line graph showing company incorporations by gender as a percentage of total incorporations. Line representing male-led is significantly higher the graph at around 60% steadily over the five year period from 2018-2022. Female-led is persistent around 20% from 2018-2022 demonstrating the gap between male and female. Line representing gender even declines from around 20% to 12% over the 5 year period. Line representing unknown is steadily around 5% from 2018-2022.
Gender Gap in Company Incorporations
A line graph showing the gender gap in business incorporations over 5 years from 2018-2022. In 2018, the gender gap between male-led and female-led incorporations was 45%. In 2019, this gap was 42%. For both 2020 and 2021, the gender gap was 44%. In 2022, the gender gap was 43%. The graph shows that the gender gap is persistent over the 5 year period
Age of founders at company start up
Bar chart showing the age of founders at company start up. For gender-even, 3% of founders were 16-25, 41% were 26-40, 50% were 41-60 and 6% were 61+. For female-led, 9% were 16-25, 45% were 26-60, 42% were 41-60 and 4% were 61+. For male-led, 10% were 16-25, 45% were 26-60, 39% were 41-60 and 6% were 61+. In the unknown category, 13% were 16-25, 51% were 26-60, 31% were 41-60 and 5% were 61+.

There are no clear differences in the ages at which women and men start their companies – with both groups most likely to start their company between the ages of 26-40, however women were marginally more likely to start a company between the age of 41-60.

Incorporations by gender and ethnicity
A bar chart showing the number of incorporations by year separated into Non-ethnic male led, non-ethnic female led, ethnic male-led and ethnic female led.  Each category shows growth over the time series.

Looking at incorporations by ethnicity[110], we can see that over the 4 years to 2021, a gender gap is also present in ethnic minority company incorporations.

Further work is required to fully understand and interpret this data as it is a broad grouping and masks the experiences of different ethnic and cultural community groups.


Data shows that female-led companies generate a lower turnover at all stages up to 10 years with data on company turnover by company age and gender indicating a slower rate of growth in female-led companies. These are average figures and are affected by company type, operating sector, access to investment, support networks, etc.

Average turnover by company age and gender
A line chart showing average company turnover against age of company. The line for male-led companies rises sharply from ‘under two year’ to ‘2-5 years’ then slowing as company age increases to ‘5-10 years’. The line for female led businesses is lower and rises more slowly from ‘under 2 years’ to ‘2-5 years’ increasing more quickly from, ‘2-5 years ‘ to ‘5-10 years’. There is a significant gap in average turnover between the female-led and male-led companies.


While female-led companies represent 19% of incorporations, we see female-led companies make up only:

  • 14% of companies receiving 'friends & family' investment
  • 16% of companies securing angel investment
  • 5% of companies receiving institutional investment. (in comparison, male-led companies make up 77% of companies securing institutional investment.)

Looking across investments over the last 12 months, across all sectors female-led businesses made up 12% of companies receiving investment versus 73% being male-led businesses – a gender gap of 61 percentage

Pie chart showing friends and family investments over the last 12 months: 65% of investments were in male-led companies, 14% of investments in female-led companies, 18% in gender-even companies, and 3% in companies with unknown leadership.
            Pie chart showing angel investments over the last 12 months: 65% of investments were in male-led companies, 16% of investments in female-led companies, 13% in gender-even companies, and 6% in companies with unknown leadership.
            Pie chart showing institutional investments over the last 12 months: 77% of investments were in male-led companies, 5% of investments were in female-led companies, 16% in gender-even companies, and 2% in companies with unknown leadership.

Over the past five years the gap between female and male-led companies securing institutional investment has widened.

Number of institutional investments
Line graph showing the number of institutional investments over a 5 year period from 2018 to 2022. The number of investments in Male-led businesses increases  from around 350 in 2018 to 700 in 2021, and then shows a slight decline in 2022 to around 675. Female-led businesses show a slight increase from 2018 to 2021 followed by a decrease in 2022

When female-led companies do receive investment, they are securing, on average, a lower quantum. Over the last five years, excluding first round investments, the average value of female led investments was £833,754 per investment vs £3,219,146 for male-led investments.

Male-led companies secured four times the investment of female-led companies on a like-for-like basis.

Average level of investment
A line chart showing the average level of investment in male-led and female businesses over the period 2018 to 2022. The average value of investment in male led businesses declined from 2018 to 2020 before increasing in 2021 and 2022.  The line for female-led companies shows a decrease from 2018 to 219, followed by annual increases to 2021 and then a decline in 2022. In all years there is a significant gap between levels of investment in female-led and male led-businesses with male-led businesses securing larger levels of investment.

Data for 2022 shows the investment value gap widening after a recent period of improvement.

Looking at institutional investment over the last five years, an average of 2p in every £1 of institutional investment went to female-led companies. In 2022 this dropped to 1.5p in every £1.

Institutional investment over 5 years
A bar chart showing institutional investment over 5 years from 2018-2022 in female-led and male-led companies. There is a stark contrast with female-led companies receiving a total of £0.17 bn investment over the 5 year period compared to £8.9 bn in male-led companies over the same time period.

There are clear differences in the sectors favoured by male and female founders. Female-led companies made up 39% of incorporations in the Health Wellbeing & Social Care Sector over the last 5 years, in comparison to only 15% of incorporations in the Information, Communications & Technology sector, 10% in Financial Services and 5% in Mining and Quarrying.

Incorporations by sector over the last 5 years
Bar chart showing gender in incorporations by sector over the last 5 years. The chart shows what percentage of each sector is made up by male-led companies, female-led companies, gender-even led companies and those in the unknown category. Sectors such as mining, construction, agriculture and manufacturing are clearly dominated by male-led companies, whilst a larger proportion of women-led companies make up the health, well-being and social care sector.

Women are receiving proportionally less investment across all sectors. Although 39% of companies in the Health, Wellbeing and Social Care sector are female-led, only 31% of companies receiving investment are female-led compared to 40% for their male-led counterparts. Similarly, in Information, Communication and Technology only 10% of those receiving investment are female-led.

Number of companies receiving investment by sector over the last 12 months
Bar chart showing the number of companies receiving investment by sector and by gender over the last 12 months. The chart shows that women receive consistently less investment across all sectors than men.

Networks and Influence

A bar chart showing the number of directorships held by directors split by the gender of company ownership and by the number of directorships held.

The chart shows more directorships in male-led companies, for both first and subsequent directorships held, and the number of second directorships is higher than the number of first time directorships. In female-led companies there is a reduction in second and subsequent directorships in comparison to first-time directorships.

In absolute terms, as expected we see a drop in the numbers of directors taking on second or subsequent directorships. Where those second directorships happen they are far more likely to be in male-led companies with over 60% of second and subsequent directorships versus 15% in female-led companies.



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