Improving enabling environment and finance options for women
By Paul Belknap – Villgro Kenya COO
Women’s History Month provides a good opportunity to reflect on Villgro Kenya’s accomplishments supporting women entrepreneurs and the areas we still have work to do. Taking this opportunity can help us celebrate the success of these amazing entrepreneurs we have the opportunity to work with and, more importantly, examine how we can do even better in the future. Given the huge gender disparity in venture funding I think it’s important to be mindful of how far we have to go. Currently 40% of Villgro Kenya’s portfolio has at least one woman co-founder or senior decision maker. By the measure of the industry average of 2% of venture capital going to women led businesses, we’re on the right path, and I’m extremely proud of the impactful and exciting work that these companies are doing and what they will continue to accomplish. Just in the past week, Flare, led by two women co-founders, has been listed as on of the “Most Innovative Companies” by Fast Company and Mama Ope’s Olivia Koburongo published a blog on the Pneumonia Innovations Network. Given the number of pitches we get in the maternal health space from all-male teams, I think that 40% is all the more impressive, but I don’t think we can be complacent, and we should document what led to us to this accomplishment, so we assimilate that in our DNA to be able to replicate it in the future.
We need to be a stronger voice in the ecosystem for the proven fact that businesses with women in senior decision making roles perform better. IFC (International Finance Corporation) research shows that companies with gender balanced leadership teams growth in valuation is 25% greater than their non-gender balanced peers. I think this is a particular necessity for businesses that seek to serve a primarily female audience, such as companies in the maternal health space that are a key investment area for Villgro Kenya, and needs to be a serious consideration (risk) as we make funding decisions. Looking further inward, our success in funding women led companies comes almost in-spite of ourselves since we don’t have a woman on our investment team or our investment committee. In order to practice what we preach, we need to look for ways to correct this balance as we grow our team, which will help us make better decisions and support the companies in our portfolio better. The same IFC report shows the outcome of those better investment decisions, that funds with gender balanced investment teams deliver a 20% higher IRR (Internal Rate of Return).
Women led companies like Maisha Meds, who are improving pharmacy supply chain and access, are creating impactful and scalable change in East Africa, and Villgro Kenya is thrilled that we have been able to be part of their success. Though we’re off to a good start, we need to think about how we can be more intentional in supporting women entrepreneurs and that starts by practicing what we preach in two key areas:
1. Examining our recruiting process to ensure that there is no bias in selection to improve our gender balance at both the execution and board level;
2. Just like we tell our entrepreneurs, listening to our customers is important, in this case that means listening to our women customers (entrepreneurs) and understanding what we’re doing well and what we can do better to support them.
If we do these things I’m confident that Villgro Kenya can do an even better job of supporting the exceptional women entrepreneurs creating impact in East Africa.
By Paul Belknap