Constantly staring at numbers is demoralizing and stifles creativity in the long run. The share of female founders in Germany continues to stagnate at a meager 19 percent and simply won’t increase. The situation is similarly bleak for female business angels: only around 15 percent of investors who support startups in their sensitive early phase with capital and expertise are women – a drop in the bucket on the hot, male-dominated investment stone. And precisely because this imbalance is so obvious and persists stubbornly, female founders, networks, and associations continue fighting tirelessly.
In light of this persistent gap, they draw attention loudly and clearly to structural problems: missing capital, stereotypical investment patterns, and unjust funding mechanisms. The path to equality in the startup ecosystem remains rocky – but pressure is growing. Everyone knows this by now. We at Encourage Ventures are also striking this chord. And we’ve launched a corresponding position paper that points out the most urgent areas for action in the startup ecosystem when it comes to gender equality. For example, we show how venture capital for female founders can be mobilized or how they can be given easier systematic access to venture capital sources.
Timid progress: more capital and first political signals
In fact, despite overwhelming venture capital structures, some movement in the right direction has already occurred: since 2017, for example, the number of venture capital financings for female-led startups has nearly doubled, and the invested capital has even quadrupled. A glimmer of hope, albeit at a low level.
Politically, too, things are moving: the current coalition agreement promises generous capital injections for growth financing and announces ambitious measures to reduce bureaucracy with “start-up-in-a-day” – at least on paper. How quickly these promising pledges turn into concrete relief in the funding jungle remains to be seen.
“Mental fit” instead of just money: what really makes startups strong
Despite these promises, the grand capital and funding pull should not distract female founders from all industries from the actual, often invisible reason why they are held back in their entrepreneurial ambitions. Many still don’t realize: healthy growth doesn’t depend on capital alone. Mental strength is the indispensable foundation for growth and innovation – this applies not only to female founders, but to all startups. What good is the most convincing pitch story if the founder falters – or in the worst case stubbornly clings to an idea despite all red flags? Founders often invest enormous energy in their external appearance to shine with their innovative business model and appropriate tech stack. They tinker with digital solutions and use cases that scale as quickly as possible, but often display a certain naivety and over-optimistic planning. Critical feedback is often not welcome with such a high investment of time and money. What is easily overlooked here: without mental fit, even the most brilliant vision remains a risk play – real innovation requires inner strength and resilience.
No growth without resilience
So that female founders especially don’t hold themselves back through mental blockades in such phases, they need sparring with experienced investors who can easily empathize with their situation, understand motivations and approaches one-on-one, and provide situational support. This is exactly where we at Encourage Ventures come in.
We understand paving the way for female founders into entrepreneurship as a collective task. Every investor, every mentor contributes a part – this is a central part of our mission. While men often hand out big deals among themselves in familiar circles, we build the foundation – organizationally, financially, and personally – on which future-proof business models can take off.
And because lack of mindset often holds back healthy growth, networks and mentoring have the same importance for us as deal flows, due diligence, or direct investments. In other words: innovation and investment go hand in hand with cooperation, transparency, and connection. Because in constantly looking at the big picture, many overlook themselves and their own impact in the funding process. Our network of over 700 female business angels – also beyond Germany, for example in France and Austria – understands networking as far more than just a nice coffee chat between founder and investor.
Critical dialogue in the early phase pays off strategically
What matters is genuine exchange on equal footing. And: there are no stupid questions. Especially in the early phase, founders need reliable connections that pay off not just on a human level, but also strategically. Whether through smart sparring or honest mentoring – the right impulses at the right time can make the decisive difference. But this only works with an open, unvarnished dialogue – including on personal topics such as acceptance, credibility, or self-worth. Because anyone who wants to lead a company must carry not just a business model, but also themselves.
Such or similar points normally play a rather subordinate role in fundraising processes and are therefore often overlooked. But in the end, they are often the reason why capital increases don’t work out or founders even have to abandon the dream of their own company entirely. Close mentoring in particular has many advantages, especially in the early phase when founders are often still very uncertain.
Trust as the foundation for healthy growth
At its core, it’s about building genuine trust – free from false assumptions or unspoken reservations. This trust is the foundation for any successful collaboration. It requires openness on both sides: the willingness to really engage with each other, to put critical success factors on the table early, to exchange different perspectives on market and solutions – and most importantly: to listen and learn from each other.
Whether as mentor or investor: the better we understand the expectations, goals, and thinking of our mentees and founders, the more effectively we can deploy our insider knowledge. Then doors open – to follow-on financing from VCs or family offices, to first lighthouse projects, to strategic partnerships. And we can help examine business models for viability and profitability – before the market does.
It’s also about societal impact
This intensive exchange gives business angels not only a sense of how much potential lies in the idea – and whether an investment is worth considering. Rather, it allows for a deeper assessment: are professional competence and personal strength sufficient to stand up for one’s own project with conviction and self-confidence? This is exactly the attitude that makes the decisive difference in every funding round. Founders benefit twice over – because experienced investors bring not just capital, but also motivation: economically, but equally often driven by hedonistic or altruistic motives. It’s about business – and increasingly about societal impact as well.
Female investing as a collective task
Startups with recognizable social impact have particularly good chances here. Because what we need is genuine connection – between all actors in the startup ecosystem. An intensive collaboration sparks motivation, creates creative spaces where ideas, minimum viable products (MVPs), and business models can emerge – and sometimes be discarded again.
Large projects and sustainable change only succeed when like-minded people work together and pull others along. Whether it’s about mental strength against the female investment gap or making capital allocation to female founders finally a matter of course – this type of collaboration makes the difference. For Encourage Ventures, it’s one of the central keys: to strengthening innovation capacity in times of crisis and to promoting genuine team diversity in the ecosystem.