2024 Sees 12% Drop in Funding for Women-Founded Startups, Yet Performance Remains Close to Market Trends

Venture investment in startups led by women has historically fallen behind the overall market trends, but recent data reveals a more nuanced picture for female founders in 2024. As companies reassess their diversity, equity, and inclusion initiatives, it’s crucial to delve into the latest insights from the Female Innovation Index 2025, a report by the European venture platform Female Foundry. This report highlights significant trends and challenges faced by women entrepreneurs in the startup ecosystem.

Decline in Overall Venture Investment

According to the Female Innovation Index 2025, venture investments in women-founded startups in Europe saw a 12% decrease in 2024 compared to the previous year. This decline is almost parallel to the 11% drop in overall venture investments, suggesting that the challenges faced by female founders are reflective of broader market trends rather than isolated issues.

Growth in Deep Tech Startups

Interestingly, women leading deep tech startups are experiencing a surge in funding, outpacing their male counterparts in this sector. The report indicates that approximately 33% of all venture capital raised by female entrepreneurs is directed toward deep tech innovations, which is notably 2% higher than the funding received by gender-agnostic startups.

• Key Areas of Innovation: Synthetic biology, generative AI, and drug development.

Insights from the Female Innovation Index 2025

The Female Foundry conducted a comprehensive survey involving over 1,200 female founders, investors, and executives, as well as more than 35 private equity firms across 20 European countries. The report emphasizes that the term “female-founded startups” encompasses any startup with at least one female co-founder, significantly expanding the sample size compared to reports that focus solely on all-women founding teams.

Challenges for Women Founders

Despite some progress, multiple surveys indicate that female founders remain significantly outnumbered. In 2024, all-female founding teams captured a mere 2.2% of total venture capital funding.

Agata Nowicka, founder of Female Foundry and the report’s author, expressed the need for more detailed metrics regarding female entrepreneurship. She stated, “The oft-quoted 2% figure about female-founded startups is not detailed enough.” She highlighted the necessity of recognizing diverse founding structures that include male co-founders.

The Impact of the COVID-19 Pandemic

The COVID-19 pandemic has inadvertently leveled the playing field for women in tech. Nowicka noted that the pandemic compelled the industry to become more accessible, resulting in increased opportunities for women entrepreneurs. “As a founder in 2016, most VCs didn’t even have a website,” she reflected, emphasizing how the venture capital landscape has transformed since then.

Key Findings from the Report

• Female-founded businesses in Europe raised €5.76 billion in 2024, a 12% drop from €6.56 billion in 2023.
• The health, fintech, and food sectors attract the highest levels of venture investment for female founders.
• Female founders see the most success at the seed stage, with average round sizes increasing 7% across all stages compared to 2023.
• Over 80% of the largest funding rounds for female-founded startups in 2024 involved founders with scientific backgrounds.
• The U.K., France, and Germany lead in investment for female-founded companies, while Finland and Denmark allocate the highest proportion of venture capital to these startups.

For more information about the evolving landscape of female entrepreneurship and venture capital, consider visiting Female Foundry and explore TechCrunch for the latest updates.