While the benefits of diverse leadership in business are increasingly recognized, it is disheartening that female entrepreneurs still face significant barriers to achieving their full potential. A recent study by EY underscores the untapped societal value of women-led businesses, which are essential for driving meaningful societal change: companies led by women tend to prioritise sustainability, community impact, and employee well-being, creating a ripple effect benefitting society as a whole.

The study also highlighted, however, the systemic obstacles that continue to hinder women entrepreneurs, particularly in securing the funding necessary to start and grow their businesses. Without addressing these issues, we risk stalling progress and losing out on the myriad benefits that female leadership can bring.

Funding gap one of many real barriers to progress

One of the most significant obstacles facing female entrepreneurs is access to funding. The disparity is stark; for example, even in Sweden–which ranks top in the EU in the Gender Equality Index–only 1% of invested capital in tech companies goes to women​. This funding gap is not just a financial issue, but one that reflects deeper biases and structural challenges that women face in the entrepreneurial ecosystem.

Indeed, there is unfortunately a general bias in the investment community, where female founders are dramatically less likely to receive investment than their male counterparts, even when they pitch the same ideas​. More targeted interventions are clearly needed to support women in accessing the capital they need, or the potential of women-led businesses will continue to be undertapped.

Several steps in the right direction

Fortunately, there are several initiatives across Europe specifically aimed at supporting female entrepreneurs and addressing the barriers they face. The Smart Lady programme is one standout example. The Smart Lady initiative was launched in 2018 by Bulgarian bank First Investment Bank (Fibank), the largest locally-owned bank in the country whose majority owners Tseko Minev and Ivaylo Mutafchiev are both seasoned bankers and entrepreneurs. Smart Lady provides a comprehensive suite of financial and non-financial services tailored to the needs of women in business. Beyond just offering preferential loan terms, including a grace period during maternity, and a host of other financial benefits including a First Lady credit card—a perk offered as early as 2006—with breast cancer insurance, Fibank’s initiative also provides mentorship, training, and a supportive community, critical elements that help women succeed in the long term as entrepreneurs​.

The initiative’s impact is evident. Over the past six years, Smart Lady has supported more than 1,100 women in starting or growing their businesses, with a total of BGN 120 million in loans granted as of earlier this year. The Fibank programme has notably extended its support to refugee women from Afghanistan, Yemen, and Ukraine, helping them build new lives and businesses in Bulgaria.

Cherie Blair, a renowned advocate for women’s rights and founder of the Cherie Blair Foundation for Women, has praised Smart Lady as an innovative initiative that is making a real difference in the lives of businesswomen. Lady Blair met earlier this year with Fibank representatives as well as some of the female entrepreneurs whose careers have been boosted through the programme, including refugee Sara Faizi, a single mother who now runs the only Afghan restaurant in Bulgaria thanks to the guidelines and mentorship support she received from the Smart Lady initiative.

Another noteworthy project working to empower female founders across Europe is the EU-funded Womenture initiative. By offering training in essential business skills and creating a network of support, Womenture is working to break down the barriers that have historically held women back in the entrepreneurial space​. The project’s emphasis on inclusivity and community-building is particularly important in regions, such as Eastern Europe, where resources for entrepreneurs are scarcer.

Womenture’s seven-week pre-accelerator programme is designed to equip future female entrepreneurs with the skills needed to develop sustainable business models, improve their marketing strategies, and secure funding​. The programme also fosters a collaborative learning environment, where women can network with peers and mentors, further strengthening their entrepreneurial capabilities.

Critical role of mentorship & community

It’s not surprising that mentorship and community support are at the core of so many programmes for female business leaders. The She’s Next programme, by Visa, has been yet another scheme which is helping foster a robust community of empowered women entrepreneurs across Europe.

This year is the second year that the programme has been active in the Nordic and Baltic regions, for example, and grant recipients announced earlier this year have included a pioneering oat diary and a company making handmade sustainable eyeglass frames from materials found in Finnish nature.

The She’s Next programme has been instrumental in providing tailored support across the various regions in which it operates. In Georgia, for example, She’s Next has conducted four successful waves of the initiative since 2020, partnering with organisations like the Bank of Georgia and the USAID Economic Security Program to provide women with business development masterclasses and extensive pitch training. In Ukraine, She’s Next adapted its approach in response to the Russian invasion, focusing on resilience and recovery for women who lost their homes and businesses and financing educational grants to help these women reskill for new entrepreneurial paths.

More support key

While these kinds of initiatives are making a difference, more needs to be done to fully unleash the potential of women-led businesses. Governments, financial institutions, and the private sector must work together to address the funding gap and provide more targeted support for female entrepreneurs, including mentorship and comprehensive training programmes.

The benefits of supporting women entrepreneurs are clear. Women-led businesses are not only more likely to prioritise sustainability and community impact, but they also contribute to economic growth and innovation. In fact, research suggests that if female entrepreneurs had equal access to financing, it could boost global GDP by as much as $6 trillion. Existing initiatives to help women along their entrepreneurial paths are important steps in the right direction, but it is time for Europe to take ever-bolder steps to support female entrepreneurs:  by investing in female entrepreneurs, we are investing in a better future for all.