The drive to digitalise Southeast Asia’s economies accelerated during the pandemic in response to lockdowns and movement restrictions. This, coupled with working from home becoming essential for many, has contributed to a surge in the number of eCommerce fempreneurs in the region.
Established female vendors showed greater interest in established eTail platforms such as Lazada and Shopee since many had to adapt to new ways of working in the COVID climate.
International Women’s Day recently brought into focus the small, but growing, number of female entrepreneurs in Southeast Asia. Many articles were written to highlight the rise of female founders in the region, with a primary focus on females in tech in Southeast Asia. However, only 20% of startups in the world have at least one female founder.
Women in tech: How Southeast Asia’s startup landscape is changing
Challenges to gender balance in the business ecosystem
While initiatives like the Lazada Forward Woman of the Year Award and Shopee’s support of women in eCommerce encourage female entrepreneurship, there is still a long way to go before there is even close to parity with the numbers of males at high levels in startups. The world of technology has long been regarded as something of an old boys’ club, with the male innovators and founders receiving the lion’s share of the support and plaudits.
Unless their ideals align with established patriarchal prejudice, female-run businesses seldom have the same amount of access to resources as male-run businesses.
Even when a woman breaks through the glass ceiling and rises to the head of a company or takes a seat in the boardroom, they are often subject to disparaging remarks, name-calling, and gender bias. This atmosphere creates an environment that discourages women from achieving their true potential or taking on the challenge of becoming entrepreneurs.
Despite the encouraging growth in funding, some efforts to funnel more money into female-run companies through Gender Lens Investing (GLI) projects are being met with “pinkwashing” accusations. This negativity is causing reluctance from some venture capitalists (VCs) to back female entrepreneurs.
Financing women in tech
It is not all doom and gloom, however, as angel investors and VCs are slowly beginning to invest in companies with women at the helm. In 2021, over $4.4 billion USD in funding was raised by startups that were founded or co-founded by women. This, according to the Female Founders in SE Asia 2021 report, equates to 17.2% of all funds raised in the region for the year and is an increase from the previous year’s 16.5%.
While these figures are encouraging, a closer examination reveals that there is still a significant funding difference between the genders. Companies with a woman as the only founder raised just 0.6 percent of the total, or $159 million USD; however, the trend was more positive for companies with a female cofounder. They raised $2.13 billion USD, or 8.9% of the total raised by private companies in the region, doubling the amount raised the previous year.
Although there has been an increase in the number of females working at high levels in tech startups in Southeast Asia, many female founders and cofounders continue to struggle to attract investments in funding rounds. In the US, female-founded companies only received 2.1% of the capital invested by VCs in startups.
Pioneering Southeast Asian women
Some of the region’s most successful companies, such as Grab, Love, Bonito and VietJet Air, have female founders or cofounders. Tan Hooi Ling, Rachel Lim, and Nguyen Thi Phuong Thao, respectively, have grown their businesses from the ground up and challenged the gender bias of the tech and aerospace sectors. Along with many other Southeast Asian women, they have disrupted male-dominated industries and successfully pushed through the barriers.
With these trailblazing females as examples of what is possible, many more women should be encouraged to revolutionise emerging industries and rise to the top of the corporate ladder in future unicorns. With the region’s population split almost 50-50 between the genders, it doesn’t make sense for startups to discriminate and continue failing to recognise the role that women can play in the development of tech and eCommerce.
As the region readjusts and reboots the economy post-pandemic, encouraging more women to start businesses and to challenge for higher-level positions in companies is essential. Research is unanimous in its findings that diversity in the boardroom improves every aspect of a startup. Angel investors and VCs must realise this and channel more investment into the startups that champion women.
Encouraging and supporting female entrepreneurs in Southeast Asia is crucial if the region’s startup ecosystem wishes to continue being a hotbed for tech development and innovation. The time has come to recognise the females in tech in Southeast Asia and give them a larger share of the funding pie.
All of them have marked new milestones and in many cases expanded their businesses despite the lingering pandemic. So whilst a disproportionately small number of businesses were founded by women, an even smaller proportion go on to secure equity finance.