Women entrepreneurs in science, technology, engineering and mathematics are on the rise in Latin America and the Caribbean, with 54 per cent successfully raising angel or venture capital and almost 80 per cent planning on scaling up their company internationally in the next five years, according to the new study “wX Insights 2020: The Rise of Women STEMpreneurs,”commissioned by the IDB Lab, the innovation laboratory of the Inter-American Development Bank, in collaboration with Santander X.
The study finds that quality mentor network plays a critical role for women founders of high-growth companies, especially in fundraising. Of the 67 per cent surveyed women founders with mentor support, 79 per cent raised formal funding from VCs, angel investors, and accelerators. This becomes even more relevant with VC funds (84 per cent).
Fintech, Edtech, Healthtech and Biotech were the top sectors of the companies featured in the survey. These are sectors that show both significant growth opportunities and potential for impact in Latin America and the Caribbean. This seems to align with the three main motivations of the surveyed STEMpreneurs behind their ventures: purpose, personal challenges and passions, plus an enthusiasm to solve pressing issues in their communities or countries.
Nevertheless, women STEMpreneurs still face key obstacles. For example, with 46 per cent of the STEMpreneurs having at least one dependant, work-life balance and the social role of women was picked as one of the top three challenges. Access to finance was the biggest challenge of all, with 59 per cent of the women picking it as their top frustration.
Despite some persisting barriers, the report shows several positive signs. The number of women co-founders has been increasing in the last five years, especially in traditionally male-dominated sectors like fintech. “Women founders are just as ambitious as men in their business growth,” says Susana García-Robles, chief of investment unit and gender initiatives coordinator at IDB Lab.
A “One of a Kind” report on the state of women entrepreneurs in LAC in 2020
This report is one of a kind—it not only demonstrates the untapped potential of women STEMpreneurs in LAC, but also shows how the scene has been changing for the last five years.
“wX Insights is a very useful tool for investors and other players interested in understanding the LAC entrepreneurial ecosystems, specifically in the rise of women entrepreneurs in STEM. Women are responsible for 64 per cent of all global purchasing decisions on products and services, so having women in C-level positions in a company increases the chance that a start-up reaches a massive market”, says Susana García-Robles
The study, an initiative of WeXchange, the largest platform in LAC that connects women entrepreneurs with mentors and investors, is based on a survey data of 1,148 women entrepreneurs in LAC, out of which 400 were identified as STEMpreneurs. The study defines high-impact women STEMepreneurs in LAC as: the founder or partner of a start-up where science, technology, engineering and maths (STEM) are key components; is formally incorporated; has operations in at least one LAC country; and has at least a minimum viable product (MVP).
The research also includes interviews with 17 venture capital (VC) investors who invest in women-led companies in the region.