A few months ago, thirty-year-old Rubal Chib, along with her co-founder Dr. Srishti Batra who was pregnant at the time, pitched for their food tech start-up qZense Labs, on the Indian edition of the American business reality TV show Shark Tank. A short while later, Chib was in India’s capital city New Delhi. As she was walking down a street, a teenage girl and her mother came up to her, and the youngster told her she had been inspired by seeing Chib and Dr. Batra on television and one day planned to found her own company.
The forces of change
Those like Chib are the outcome of the change in the upbringing of girls in many middle-class families across India. Chib is the daughter of a lawyer and healthcare professional who worked for the government defence department. She spent her childhood moving across the country, due to her parents’ jobs. This taught her to take disruption in her stride. Chib does not hesitate to credit her upbringing for where she is today. Her unconventional parents encouraged her to explore her interests, did not insist on high performance during her student years, and never came in the way of her choices.
Of equal importance, they treated her and her older brother the same and Chib grew up discussing science and the stock market with her sibling. With this solid grounding, Chib has always had a clear idea of her goals and dreams and is unafraid of failure and risk-taking– essential qualities for entrepreneurship.
This wave of female empowerment is intertwined with a larger social transformation. According to Ravi Chhabria, Managing Director, India at NetApp (which runs the global startup program NetApp Excellerator), Indian metros like Bangalore, which attracts the highest start-up funding in the country, draw smart, young immigrants from all over the country. These young people have broken away from earlier cohorts in two ways. One, they have a stronger appreciation of the disruptive nature of new technologies such as cloud and AI which helps them unearth new business models and start companies faster. Second, they leave behind traditional baggage such as the need for job security and strictly defined gender roles. And this shift, Chhabria says, will lead to an environment where a greater number of women chase their founding dreams.
As seen with Chib and Dr. Batra, role models are already capturing the popular imagination. Falguni Nayar whose e-commerce company Nykaa went public and Ruchi Kalra, co-founder of B2B commerce start-up OfBusiness and its lending arm Oxyzo, are two women founders who have recently been in the headlines for stepping into a small, elite club of women unicorn founders.
The broader picture however leaves something to be desired. In the world’s third-largest start-up ecosystem, only ten percent of co-founders of tech start-ups are women, according to the industry body NASSCOM. Research from the US says 26% of technology start-ups have at least one woman founder, while ASEAN numbers point to 20% of venture-backed tech start-ups having at least one woman founder. In India, NASSCOM estimates that one in two of the larger technology players in India will have 20% women in C-suite roles.
A path paved with hardship
Indian social norms that hold women back in other professions do so even more in the tough, high-visibility world of start-up founders. Families like Chib’s are not yet the norm. Hence, the messaging that continues to get reinforced at home and school is that girls are not as good as boys, should make safe, bankable choices that will help them carry out their future caregiving roles, and prioritise personal responsibilities over professional ambition.
“The kind of upbringing I had is a privilege and I recognize that,” says Avlokita Tiwari, Co-Founder and Chief Technology Officer at healthtech start-up AarogyaAI Innovations. Her parents never stopped her from pursuing what she desired, and she rues the fact that many of her female classmates were not raised similarly. Growing up with the belief that the only direction their lives could take was to get a graduate degree and get married, they have been unable to achieve their highest potential.
This gender bias follows women into the working world. “I've heard fellow women founders talk about the very hard journey they have had to make, and the microaggressions they have had to deal with such as being hit upon, not being taken seriously, or looked over for opportunities. All this is before coming up to the point where they decide to build their own company,” says Laina Emmanuel, Co-founder and CEO of another cutting-edge healthtech company BrainSight.AI.
Even at this juncture, the odds are unfavourable. Networks that are pivotal to funding and building start-ups often have their roots in the country’s top management schools and engineering institutes. Since the ratios here are rarely in favour of female students, far fewer women than men find themselves members of these circles.
Societal rules also come in the way of expanding one’s networks. “In many places, it's not okay for women to hang out after office, or in the evening or at campuses,” says Nupur Garg, Founder of WinPE, a not-for-profit that advocates for greater female representation across all levels at PE/VC organizations. “Because of this, women traditionally don't have networks as deep as men do. This makes women more hesitant to reach out,” she says, when they need help or guidance during the uphill task of setting up a company, as they do not have a large professional circle to turn to.
Less equal when it matters
At the crucial stages of pitching to investors and clients, it does not get any easier. Women founders encounter a blend of scepticism, condescension, and sexism. Two female co-founders were once asked at a client location where their boss was. Another woman founder recalls being asked how much she knew about the business side of things as a technologist, despite having built the business from the ground up. A team of female co-founders were once told by a male investor that they had a great idea but needed a male co-founder. Women founders are also routinely asked how they plan to balance pregnancy and parenthood with work.
Research has found that of the 2,460 investors who participated in total startup funding activity in India from January 2018 to June 2020, only 540 investors, around one in every four, invested in start-ups led by at least one woman founder. This accounted for only 5.77 percent of the total funding at $1.69 billion across 378 deals, while only female-founded start-ups fared worse at just 1.43 percent ($480 million) across 80 deals.
Like in all spheres, women haven’t allowed these challenges to hold them back. Emmanuel observes that by the time a woman decides to become a founder, she has learnt to treat discrimination as an irritant to be gotten out of the way. “As a mature person one ignores rhetorical and negative questions,” says Emmanuel’s female co-founder and CTO at BrainSight.AI, Dr. Rimjhim Agrawal.
Creating networks of support
While women founders carry on mostly undaunted, the larger ecosystem is waking up to the fact that these are issues that need to be tackled at a systemic level.
NetApp ExcellerateHER, the women-focused offshoot of the successful NetApp Excellerator program is an example. Madhurima Agarwal, Director - Engineering Programs, India at NetApp who runs both the accelerators, was once a tech entrepreneur. This earlier experience led her to set up an initiative for women founders. “This is not to say we have carved out a program for women because they need special attention,” she clarifies. “We hold ExcellerateHER applicants to the same high standards that we do all our founders. This is more to ensure we put in the effort to find those women and build a pipeline.”
Given the well-known reasons, Agarwal acknowledges that it is hard to find suitable female candidates. NetApp ExcellerateHER provides the selected women founders access to support and resources critical for company-building. In addition, it offers a space where male and female founders learn from each other regularly. Agarwal’s team also attempts to include female mentors and subject matter experts in all its workshops and events –a step towards sensitising the ecosystem to diversity and normalising female success and leadership.
Within the government too, there is recognition that women need equitable access to resources and networks to grow in entrepreneurship. Startup India, a government initiative has set up a support ecosystem for women founders WEP, in partnership with the Small Industries Development Bank of India. This is one among a few programs at the state and central levels. Leading management schools and large local and foreign corporate houses also run women-focused incubators and accelerators. Many of these entities collaborate to offer the programs.
Encouragingly, women founders say that quite a few incubators and accelerators are mindful of unbiasedness and gender parity throughout the selection and mentoring processes, though this is not stated openly.
The march for equality
On the investor front, initiatives like Garg’s WinPE are working to eliminate bias. A recent study WinPE conducted jointly with BCG found that while women are at 40% strength at the associate level in PE/VC firms across India and Asia, this drops to around 20% for mid-level roles and less than 15% at the partner level.
“We believe having more women in decision-making roles as investors will lower the discrimination against women founders,” asserts Garg. “Conscious of their female colleagues sitting next to them, male investors will evaluate male and female founders by the same criteria, and this will have a huge positive impact on funding for women-led businesses.”
Some PE/VC firms that WinPE works with have recently promoted women to the top and Garg hopes the sector will see more of this.
And finally, what of societal expectations that continue to place a large chunk of caregiving responsibilities on women’s shoulders - preventing them from taking on the huge demands of entrepreneurship. Very shrewdly, Agarwal points out that the way to break this cycle is to create as many successful women founders as possible. The public recognition that comes with this will lead more and more families to understand that wives, sisters, daughters, and daughters-in-law can achieve as much as the male family members when they are similarly supported.
With this, she says, the Indian start-up ecosystem will find its tipping point. After which, female-founded unicorns will be as much the norm as those founded by men.