Female founders fast-tracking the transition to clean energy
The challenge of climate change must be met with serious urgency. Countries around the world need to pursue efforts to limit global warming, and the energy sector has an important role to play in helping achieve carbon neutrality, or net zero.
In the last five years the industry has entered a transitional period; moving away from carbon intensive oil and gas operations, and instead exploring alternative opportunities, many of which are presented in the renewables space. However, many of the solutions that are required to deliver clean and affordable energy in the UK are still emerging or at research and development stage. As with every evolution, there is a key catalyst: innovation. The energy transition provides a huge opportunity for companies to embody and demonstrate ingenuity. In turn, this will lead to the discovery and advancement of technologies that will help meet tomorrow’s energy needs and combat climate change.
Startups are rising to the challenge – in the UK there are nearly a thousand operating in the cleantech, greentech or green energy space. But fast-tracking progress, so they don’t lose first mover advantage or scale-up opportunities, must be front of mind. Short term support, long term vision setting and access to expertise is where accelerator programmes come in to their own. It has been proven that startups who complete accelerator programmes have a higher survival rate.
At the Net Zero Technology Centre (NZTC) we’re offering pioneering start-ups up to £100,000 grant funding, expert mentoring, and access to an extensive industry network through our 15-week TechX Clean Energy Accelerator programme.
To date, 45 startups have graduated from the accelerator, developing, and delivering a range of trailblazing technologies. From a radical low-cost floating wind turbine design that boosts performance, to floating buoys that provide cost-effective 5G at sea, the startups that emerge from the TechX programme offer promising solutions that will shape the future of energy.
To continue to effectively support and nurture the startups of the future, we must identify and explore the key influences that determine their success. This includes the team, which is at the centre of any thriving company.
Diversity of thought drives success
Startups worth backing have a strong and novel technology, but this must be driven by a committed team. Investors aren’t just looking for high-potential solutions, they are investing in the right people to take the technology to market. The most successful companies are comprised of teams that possess the right technical skills, business acumen and the ability to think creatively and critically. Another invaluable attribute is diversity of thought.
Out-of-the-box thinking doesn’t happen by chance. By and large, innovating is the process of exploring multiple routes before unearthing that one game-changing solution. Having gender diversity in any company can dramatically hasten this process, widening viewpoints and allowing for ideas to be developed from various perspectives. Men and women often have differing approaches, experiences, and skillsets, leading to a richer talent pool and more efficient problem solving. With an improved collaborative approach, gender-diverse startups can create a more innovative culture, with greater performance and a higher chance in finding success.
Gender-balanced teams also demonstrate increased output, which starts within the business itself. It has been proven that female-led companies often foster more favourable working conditions. Staff working as part of a diverse workforce tend to feel respected and valued, and are more likely to stay with the company, reducing recruitment and retention costs. Female-led teams are also more likely to offer employees a degree of flexibility, increasing their likelihood of attracting more talent. And with the right mix of people comes improved results: venture capitalists have reported higher returns on investment from female-led startups, generating 63% more value for investors than those male-led.
Yet despite evidence of high growth and strong delivery, female-led startups receive significantly less investment than male-led startups. In 2021, all-male founder teams received 85% of venture capital investment in the UK, with only 15% being captured by startups with at least one female founder. This is discouraging, particularly for passionate female founders with new ideas looking to start a business venture. While there are always personal and financial risks associated with starting a business, these are clearly magnified for female entrepreneurs.
So, why is this? Unfortunately, unconscious bias is still prevalent in most sectors. It has been reported that 67% of questions posed to male entrepreneurs during their initial pitches focused on a founder’s vision for growing the company. These numbers were reversed for female founders: regrettably 66% of questions were prevention focused, asking how a founder will prevent the business from failing. While it is easy to conclude that progress has been made in terms of gender-equality, a staggering 39% of female founders are said to have frequently encountered sexism in the pitching room. We must remain vigilant and recognise that these patterns still exist.
Female founders flying the innovation flag
It is critical, particularly in the male-dominated energy and tech sectors, that investors and the early-stage company support ecosystems take an inclusive approach when investing in emerging businesses. It starts by setting a clear intention and facilitating an environment that is mindful of inclusivity and the potential threats posed by unconscious bias.
In 2021 at NZTC we tackled this issue head on, publishing an aim to see at least 30% of companies shortlisted for the TechX Clean Energy Accelerator to be female-led, by either a CEO or a senior leader with an equity stake in the company. To combat the gender disparity further, we maintained a 50% gender split in the judging panel during our Finalist Pitch Day. Similarly, we aimed to ensure that the invaluable support network TechX offers was itself diverse. When recruiting for our mentors and supporting partners, we found strong female role-models that could guide our startups towards success.
This commitment resulted in more than 40% of our recent cohort of startups being represented by female-led and gender mixed teams. The ideas brought forth are revolutionary, and each backed by diverse, tenacious founders that have gained exposure to opportunities that will help fast-track their business growth. One of these startups is Glasgow-based Napkin Innovation, founded by Jacqueline Morrison. The company is introducing a novel method for fixing offshore wind turbines to the seabed, acting as an alternative to grout which is cement based and produces high emissions. The technology estimates a potential reduction of up to 40% of carbon emissions compared to current methods of installing offshore wind turbines.
Napkin Innovation’s technology won the Scottish Power Renewables’ innovation competition, and Jacqueline herself won the 2020/21 InnovateUK ‘Women in Innovation’ Award. Napkin Innovation is primed for success, integrated with a support network that will continue to work with the team over the next two years through our TechX Growth programme. The offshore wind sector offers huge growth potential globally and it presents a massive opportunity for the company to continue to advance.
We are currently accepting applications for our next cohort and are not slowing down on our mission to discover more companies like Napkin Innovation. We have now increased our aim to see 50% of shortlisted startups led by women or have gender mixed teams. And as a core part of the programme, we will also introduce a dedicated session on the benefits diverse teams can bring for any company, as well as unconscious bias training. We see this as being essential, especially for the startups that could make a huge impact on the industry as we know it. To solve the world’s most critical technological challenges and tackle climate change head on, we need to maximise diversity of thought. Improving gender diversity is a critical part of the solution, and in doing so we will build a more equal culture where businesses and individuals can thrive.
This article originally appeared in the Sept/Oct issue of Startups Magazine. Click here to subscribe.