Funding for Women Entrepreneurs: Why Women Still Get Less of the Money and How to Change That

Erica Anderson Rooney is an ex-CPO turned executive coach and AI educator on a mission to get more women into positions of power and keep them there. She is the author of The AI Gap (2026), host of the Glass Ceilings & Sticky Floors and AI Voice or Victim podcasts, and NC Chapter Lead for Women Applying AI. Her SNAP and AI Continuum frameworks are taught to thousands of women through CHIEF, WICT, and Fortune 500 leadership programs. She is the sought-after speaker at the intersection of women, AI, and leadership.

Growing up, my dad owned a small paint manufacturing business in Gainesville, FL. I thought it was the coolest thing that he was a business owner, but the thing is, he never wanted it. He was never supposed to run the family business. But after the tragic and untimely death of his older brother, he was thrust into it. For him it was always stress and one of his biggest burdens to carry. I watched that weight my whole childhood, and I grew up with this mentality of, I am never gonna own my own business.

So I ran straight into corporate America and chased the guaranteed paycheck, the benefits, and the so called security. (Notice I did not say FREEDOM?) And y'all, I believed that story - that to own your own business was a struggle to be avoided at all costs - for most of my life. Today I run HER Collective, and I think about that little girl a lot, especially when I read the research on funding for women entrepreneurs. Because the women who do decide to build something are running into the same two walls, over and over: money and caregiving.

A brand new global report puts numbers on both, and I want every woman who has ever thought about starting a business, and every woman who already has one, to see them.

You Already Know This Woman

Maybe she is you. (Raise your hand. I see you.) She has the idea, the skills and the customers who keep asking when she is going to go out on her own. Maybe she already did it. She has a consulting practice, a product, a side business that is getting too big to call a side business.

She is smart about it and she is using AI to do the work of three people. She also has a plan. And when she goes looking for the money to grow, the doors that open so easily for the guy named John in her industry stay a little more closed for her.

Then there is the other thing that happens all the time. The sick kid. The parent who needs rides to appointments. The school calendar that seems to have a half day every other week. When something has to give, she is usually the one who gives it, and sometimes what gives is the business.

The newest research shows all of it in black and white and I don’t think you can ignore it anymore.

What Funding for Women Entrepreneurs Looks Like in 2026

The Global Entrepreneurship Monitor, the long-running international study of who starts businesses and why, released its 2025/2026 Women's Entrepreneurship Report in October 2026. It covers 48 economies and, according to Forbes, survey data from more than 150,000 adults.

The good news first, ok? The startup gap is narrowing. In 2025, 12 percent of women surveyed were running new businesses, compared with 14 percent of men. And women were leading about 40 percent of the high-potential new businesses GEM tracked, the ones built to grow. Yes, ma'am!

Women are also building with new tools. GEM reports that women made up 43 percent of the entrepreneurs reporting AI innovation in their businesses, and 42 percent of those reporting new products or processes. Women business owners are in the mix on technology.

Now the hard part. Say what? About 70 percent of informal investment worldwide went to men. That is the early money from friends, family and individual backers that gets most young businesses off the ground. And the gap grows over time. GEM found the ratio of women to men among owners of established businesses was 0.69 in 2025, the widest gender gap at any stage of a business's life.

The venture money tells a similar story here at home. PitchBook reported in March 2026 that U.S. companies with at least one female founder captured 27.7 percent of venture capital deal value in 2025, an all-time high. Read the fine print, though. About two-thirds of those dollars went to AI companies, and more than $30 billion came from two deals alone, Scale AI and Anthropic. Fortune, reporting on the same PitchBook data, noted that all-female founding teams saw steeper drops in both deal value and deal count than mixed-gender teams.

So the headline number went up, and a handful of giant AI deals did most of the lifting. (Two deals. Two! That is a record built on a couple of giant checks, y'all.)

Why Do Women Entrepreneurs Get Less Funding?

Women entrepreneurs get less funding because early money follows networks and industries that favor men. In the GEM 2025/2026 Women's Entrepreneurship Report, about 70 percent of informal investment went to men, and many women build businesses in sectors investors tend to skip.

Amanda Elam, the report's lead author, explained it plainly in an interview with Forbes. Women tend to cluster in sectors like social services and retail, and on investment in those areas, she said, "Investors don't play there, because the ROI is not very high."

Just humor me and think about what that means. The businesses women build often serve families, communities and everyday customers. Those businesses create jobs and keep towns running. They just do not fit the return profile the people with the checkbooks are looking for.

There is a second reason, and it has nothing to do with the business plan. Women in the GEM study were 55 percent more likely than men to name family or personal reasons for exiting a business, 20 percent of women compared with 13 percent of men. Ugh.

That lines up with what Catalyst found among women who left jobs. In a survey reported in January 2026, 42 percent of women who voluntarily left the workforce in 2025 named caregiving, including the cost of child care, as the strongest factor in their decision. The second shift follows women out of corporate and right into the businesses they build. (Which one is weighing on you more right now, the money or the caregiving? Or is it both?)

The Floor I Was Standing On

My framework, Sticky Floors vs. Glass Ceilings, splits what holds women back into two kinds of barriers. Glass ceilings are the outside ones, the systems and rules someone else built. Sticky floors are the inside ones, the beliefs and habits that keep us stuck.

That 70 percent is a glass ceiling. A woman with a great business can do everything right and still find that the early money goes to the guy whose college roommate just sold his company.

That mentality of never owning a business was my sticky floor. Nobody put it there on purpose. I absorbed it from watching my dad, and it steered my career for years before I ever questioned it.

Most women carry some version of both. You can't fix the ceiling alone. You can absolutely start working on the floor today.

Move 1: Ask for the Money Before You Need It

The worst time to raise money is when you are about to run out. I want you to start the relationships now. Have coffee with the local bank's small business lender. Learn who the angel investors in your city are and what they have funded. Ask a woman who has raised money what she wishes she had known.

Then, when you need capital, you are calling people who already know your name and your numbers. Informal investment runs on relationships, so build them while the stakes are low.

If you are still in corporate and only dreaming about it, start anyway. The relationships you build while you have a steady paycheck are the ones that will take your call later. Ask your company's procurement team how they find new vendors. Ask the founders you admire how they landed their first customer. All of it counts.

Move 2: Become the Investor You Wish You Had

Here is my favorite number in this whole conversation. GEM's 2024/2025 Women's Entrepreneurship Report found women were 2.5 times more likely than men to invest in women. Yes! Women back women. If you want to see what that looks like in real life, watch Show Her the Money. Catherine Gray, founder of She Angel Investors, produced the documentary. It follows four entrepreneurs as they build their companies with backing from women angel investors, and it breaks down how venture capital works so the rest of us can follow along. I joined an investor dinner Catherine co-hosted in New York last month, and sitting in a room full of women founders, leaders and investors, I could feel what happens when women decide to fund each other. (Put it on your watch list. You will thank me.)

You may not be writing six-figure checks. Most of us are not. You can still be part of the money. Buy from women-owned businesses. Refer them to your company's vendor list. Pay full price and leave the review. Introduce a founder you believe in to the one person in your network with money to invest. Every one of those moves sends capital toward a woman.

Move 3: Put Caregiving in the Business Plan

If family reasons are what close women's businesses, then caregiving belongs in the plan from day one. Price child care and backup care into your costs. Build the business so it can run for two weeks without you, with documented processes and someone who can step in.

And have the conversation at home before the business needs it. Who covers the sick days this year? Who takes the school pickups during your busy season? Put it in writing if you have to. A business that depends on one woman never getting a phone call from the school nurse is a business at risk.

Move 4: Use AI to Stretch Every Dollar

Women are already showing up in the AI numbers, making up 43 percent of entrepreneurs who report AI innovation in GEM's latest report. When outside money is harder to get, every hour and dollar inside the business counts more.

Pick the three tasks that eat your week, whether that is proposals, client follow-up or bookkeeping prep, and build an AI workflow for each one. Then use the hours you get back for the work only you can do: selling, building relationships and making decisions. If you want to think bigger about this, listen to my conversation with Seema Alexander on how to rewire your business around AI before you bolt AI onto a broken process.

Move 5: Get Into the Rooms Where Money Moves

Capital follows proximity. The founders who raise money are the ones who are in the room when someone says, "I know a woman you should meet." So go find the rooms. Women's founder groups, industry associations, investor pitch nights, peer communities where women share what they charged, what they raised and who said yes.

Ask the women around you one specific question this month: "Who funded your first year, and how did you meet them?" Share your own answer first, and pass along every name you can.

The Bigger Picture for Women, Work and Leadership

A woman who owns a business is a woman in leadership. She is hiring people, setting pay and deciding how her company treats parents. When she cannot get the money to grow, or has to close because the caregiving fell on her, we lose a future employer and a future decision maker.

A lot of the women who start those businesses come straight out of corporate America. When a company loses a woman because the job had no room for her life, there is a real chance she goes and builds something of her own. I want her to have the money to build it well.

GEM's own recommendations point the same direction: support businesses at the growth stage, widen the definition of high-potential industries, help directly with caregiving, and invest in women's investor networks. Every one of those is something a company, a city or a group of women can start on now.

What I Want You to Take From This

Women are starting businesses at nearly the same rate as men, leading a big share of the ones built to grow, and using AI to do it. The gap shows up in who gets the early money and who carries the caregiving, and both of those can change.

If you own a business, start building your money relationships now and put caregiving in the plan. If you are thinking about it, you're not crazy. That idea you keep coming back to deserves a real look. And whatever you do, spend some of your money on women.

Build It With Women Who Get It

This is exactly the kind of conversation we have every week inside HER Collective. It is a room of women who are damn good at what they do, with weekly live coaching, monthly expert masterclasses and hands-on AI training, plus frank talk about the job, the business and the life underneath both. Whether you are building a business or building the case for your next role, you will find women there who will share what they asked for and what they got. For more on getting paid and promoted for your work, browse our Getting Promoted posts.

We saved you a seat.

I am cheering you on, and I am buying from you.

Erica

Frequently Asked Questions

Why do women entrepreneurs get less funding?

Early money follows networks and industries that favor men. The Global Entrepreneurship Monitor's 2025/2026 Women's Entrepreneurship Report found about 70 percent of informal investment, the early money from friends, family and individual backers, went to men. Women also tend to build in sectors like social services and retail, which investors often skip.

Are women starting businesses as often as men?

Nearly. In 2025, 12 percent of women surveyed by the Global Entrepreneurship Monitor were running new businesses, compared with 14 percent of men, and women led about 40 percent of high-potential new businesses. The gap grows later, when women are less likely to own established businesses and more likely to close one for family reasons.

How does HER Collective help women who own businesses?

HER Collective gives ambitious women a weekly room to get coached on the job, the business and the life underneath both. Members get live coaching with Erica Anderson Rooney, monthly expert masterclasses and hands-on AI training, plus women who will share what they asked for, what they charged and what they got.

About the Author

Erica Anderson Rooney is an ex-CPO turned executive coach and AI educator on a mission to get more women into positions of power and keep them there. She is the author of The AI Gap (2026), host of the Glass Ceilings & Sticky Floors and AI Voice or Victim podcasts, and NC Chapter Lead for Women Applying AI. Her SNAP and AI Continuum frameworks are taught to thousands of women through CHIEF, WICT, and Fortune 500 leadership programs. She is the sought-after speaker at the intersection of women, AI, and leadership.