Gender Inclusion Through Investing: Exploring Possibilities

LightCastle Analytics Wing
December 13, 2021
Gender Inclusion Through Investing: Exploring Possibilities

In the last decade, women have made tremendous strides in Bangladesh, stepping out of the home to participate in the economy. However, Women entrepreneurs face formidable obstacles, like difficulty in obtaining loans and start-up capital or the lack of formal support (such as sympathetic public policies, access to financial institutions, and professional training programs). To enable women to pursue successful business activities, the topic of gender inclusion and gender lens investing has gained momentum among the investor circle. 

With the concept of “inclusive growth” deeply embedded in the programme, Biniyog Birddhi brought together a panel of investors, entrepreneurs, lawyers, and intermediaries to share how impact can be amplified to improve gender inclusion through investments. The panel discussion titled “Gender Inclusion through Investing” was hosted on 2nd December 2021. 

The following reputed panelists shared light on the definition plus usage of gender and gender lens, the impact of investment using a gender lens, and the overall gender inclusion scenario in Bangladesh.

  1. Sylvana Q. Sinha, Founder, Chair, & CEO, Praava Health
  2. Anita Ghazi Rahman, Founder and Managing Partner, The Legal Circle
  3. Nirjhor Rahman, CEO, Bangladesh Angels
  4. Bijon Islam, CEO, LightCastle Partners 
  5. Maxime Cheng, Lead Market & Capacity Building Programs, Roots of Impact (moderator)

Gender and Gender Lens Investments

Defining Gender: Gender, as opposed to sex, is a spectrum and not a binary concept. It refers to a multitude of roles, behaviors, activities, and attributes representing numerous, which can also be labeled by marginalized identities. In the context of Bangladesh, Gender Lens or Gender Inclusion often refers to the inclusion and participation of women.  Incorporating gender analysis into the investment sphere allows society to grow inclusively,  with equity and fairness.

Defining Gender Lens Investing: In fact, gender lens investing is much more than just investing in female entrepreneurs. Gender Lens Investing refers to a fundamental change in the decision-making process of investment by incorporating gender analysis alongside financial analysis. For example, with access to networks being a traditional barrier for female entrepreneurs to access investors, how can one design the deal-sourcing process in a way that ensures a wider reach beyond male entrepreneurs? Also, what are the KPIs and data that one shall keep track of in an investment, in order to stay informed about its progress in serving women or other marginalized groups of customers? All these steps are crucial to better align investment with the goal of gender inclusion.

Applying Gender Lens Across Investment Process_LightCastle Partners

“If the predispositions that society puts on women are removed, then women can perform at par with the other gender. While Gender Lens Investing is more of a new concept to us, it will be very impactful if we can generate a gender lens roadmap for the businesses.”

Anita Ghazi Rahman
Founder and Managing Partner, The Legal Circle

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Incorporation of Gender Lens in the investment scenario in Bangladesh

Challenges faced as a women entrepreneur: Access to capital and fundraising is one of the biggest challenges that a founder has to face, which is aggravated further for female founders. Given that the majority of the investors are men, women often face aggressive questioning and probing when seeking funds. Female entrepreneurs generally have to be prepared for every negative scenario because of the undermining social effects of gender roles. 

“It is challenging to raise investments as a female founder. We are raising the topic to create a community where women can find more support. Our advice to women: Find allies, not only with other women but also with men who understand the challenges that you are going through.”

Sylvana Q. Sinha
Founder, Chair, & CEO, Praava Health

Investors’ perspective: Investors and venture capitalists usually go through impact metrics or KPIs to identify businesses with environmental and social impact. These metrics, in majority cases, do not prioritize a gender lens analysis. Hence, gender inclusion dimensions are not adequately considered before any investment is made. Focusing on supporting not only female-led businesses but also female investors to balance the ecosystem is a priority. There is a need for a dedicated instrument for women-led ventures. Bangladesh Angels Network has been working on a women’s angel chapter, Bangladesh Women Angles Network – BWAN, that will dedicatedly work and focus on the female-led business landscape in Bangladesh. 

“We are working passionately towards gender lens investing – facilitating female investors and founders. At present, 30% of the founders in our portfolio are investable women-led enterprises, and we are also working towards improving the participation of female angel investors.”

Nirjhor Rahman
CEO, Bangladesh Angels

“Gender inclusion is supporting and rewarding the diversity in culture and professional structures. Gender lens investing supports both men and women who are in the decision-making roles of a company, based on our research data. Most importantly, gender lens investing is not just about focusing on women but also about reaching the vulnerable groups who do not have access to modern instruments.”

Bijon Islam
CEO, LightCastle Partners 

Striding forward 

While the gender lens shall be applied more often in investment processes and decisions, we shall be aware of “gender-washing” and be diligent with the financial analysis that in other investments. The “Theranos/ Elizabeth Holmes” case can be a good example of why investing in a female-led company without any sort of due diligence is not a good idea. Including a gender lens in the analysis makes the decisions more impactful for the business and the ecosystem. However, it is always recommended that investors take their time to analyze and make decisions based on data and logic.  

In fact, beyond investments, equality in workplaces and the startup ecosystem plays an essential part and shall aim to be bias-free. Women need to be empowered as entrepreneurs by improving the ease of doing business, creating workplace equity, and increasing access to the market and finance. 

In terms of the local ecosystem, local companies need to educate themselves on the due diligence process and how an investment works legally. While a great pitch with a gender-inclusion narrative is part of the success, it does not guarantee the investment. A gender lens roadmap for existing companies can be a starting point for investors and founders alike to analyze the need for and role of impact funding. 

Maime Cheng, Roots of Impact

“Gender is more of a spectrum than a binary concept. When it comes to gender inclusion through investing, very often we think about investing in female entrepreneurs. However, there are many ways to support women in pursuit of entrepreneurship such as improving the ease of doing business, creating workplace equity, and increasing access to market and finance. In a wider sense, we also need to empower women as consumers through women-focused products and services.”

Maxime Cheng,
Lead Market & Capacity Building Programs, Roots of Impact

This article was originally published on the Biniyog Briddhi website.

Biniyog Briddhi (“B-Briddhi”) is a multi-year programme dedicated to supporting a thriving ecosystem where impact enterprises of Bangladesh can grow and scale their impact. Set up as a public-private development partnership (PPDP) between the Embassy of Switzerland in Bangladesh, Roots of Impact, and LightCastle Partners, the programme strives to improve the financial, social, and environmental performance of impact enterprises by helping them to master investment readiness and impact management and get ready to access innovative finance to scale. The programme unites many important stakeholders such as investors, private sector organizations, incubators, accelerators, support organizations, and advocates for impact enterprises.

You can also watch the full webinar here:

WRITTEN BY: LightCastle Analytics Wing

At LightCastle, we take a data-driven approach to create opportunities for growth and impact. We consult and collaborate with development partners, the public sector, and private organizations to promote inclusive economic growth that positively changes the lives of people at scale. Being a data-driven and transparent organization, we believe in democratizing knowledge and information among the stakeholders of the economy to drive inclusive growth.

For further clarifications, contact here: [email protected]

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