Calling all angels: The case for more female investors

£250bn. That’s how much value could be added to the UK economy if female entrepreneurs were invested in at the same rate as their male counterparts. And, in the rapidly evolving UK investment ecosystem, one trend stands out: when female investors participate, they are more than twice as likely to invest in female founders. Male investors are missing out on a huge slice of economic opportunity.

Our new report in collaboration with the UK Business Angels Association (UKBAA) explores this very ecosystem: its evolution, impact, and challenges – and what needs to be done to drive it forward. Because while it shows a remarkable 60% increase in the number of angel investors since 2022, with the number of female angels growing from 5,000 to over 8,000 and with more than £4bn of equity deals involving women angel participation in some form, they still only represent 14% of all angel investors in the UK.

The latest stats also show that women angels are far more likely to have gender-balanced portfolios (49/51 female/male) and 30% of their investments were directed toward 2,155 women-led businesses, compared with just 19% of male angel investment going to female founders.

And because women are more likely to back women, encouraging more women into angel investing is key. Women are leading the way, but we need more of them.

See also: Backing female-founded firms

The value of angels

Angel investment is a cornerstone of innovation and growth in the UK, for multiple reasons. It plays a vital role in providing equity finance for early-stage founders, and often provides additional support, networking and mentoring as a business is finding its feet and starting to scale.

For investors, it represents a chance to invest in the next generation of business founders, developing their investing confidence from smaller investments via syndicates through to developing a portfolio of company investments, and all in a tax efficient manner. It is striking how few people are aware of tax relief incentives such as the Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS).

Taking action and the power of syndicates

Despite these clear benefits and obvious impact, this gender imbalance is often exacerbated by broader economic conditions: when headwinds blow, investors stick to what they know, and male angels tend to double down on male-led ventures. A familiar story.

This is a reality that underscores the need for collective action across both the government and private sector to counter the trend; leveraging all available policy instruments, including a deliberate incentive to back founders that are too often overlooked – such as through extended EIS tax relief, or a SEIS that aims to reduce risk.

We also cannot ignore the significant role that angel syndicates have played, and continue to play. These provide women with a sense of community and help demystify the investment process, offer vital support, education, mentorship and the ability to pool resources. It remains a nascent market, and there is a need to increase the diversity of the angel investment base across the UK.

Our report highlights a number of leading syndicates across the UK and I’d encourage potential angel investors to start there. Many of them run free introductory courses to give you the confidence you need to start on your journey to be an angel – and to play your part in backing the next generation of budding female entrepreneurs.

One thing is for certain: the potential of female entrepreneurs in the UK is immense and the value of female (and male) angels in realising this potential cannot be overestimated. The Invest in Women Taskforce exists to turn this potential into a reality and, while we are proud to be a catalyst for change, there is so much more work to do.

Crucially, the responsibility does not lie with women alone – the wider ecosystem must play its part. If we all come together, the opportunity is enormous. Let’s seize it, together.