Alice Hu Wagner – Managing Director, Strategy, Economics and Business Development at British Business Bank
Life sciences is one of the most successful sectors in the UK economy and its continued growth is a key part of the Government’s industrial strategy.
The sector employs more than 230,000 scientists and staff across the country and generates at least £64bn of turnover for the economy.
If the UK is to maintain momentum in the industry, however, and stay at the cutting edge of innovation, we need to continue our efforts to invest in and support our best talent.
Women are still severely underrepresented in STEM occupations. According to the Women in Science and Engineering (WISE) campaign’s latest analysis of UK labour market statistics, women make up just 27% of the science workforce.
Earlier this year the British Business Bank’s UK VC & Female Founders report found that for every £1 of venture capital (VC) investment in the UK, all-female founder teams get less than 1p.
By comparison, all-male founder teams get 89p. In total 83% of deals that UK VCs made last year had no women at all on the founding teams.
The life sciences sector, however, is bucking that trend, faring far better than many others when it comes to investing in women-led businesses.
When looking at the distribution of UK VC deals by industry, the Bank’s research found all-female teams in the biotech and pharmaceutical sectors received 10% of funding, compared to 7% for all-male – a marked contrast to industry as a whole.
All-male and all-female teams in companies producing healthcare devices and supplies received and equal proportion of VC funding (5%), while similar teams providing healthcare services and systems also received an equal proportion (2%).
British Business Bank-supported funds provide some good examples of where the right sort of funding at the right time has helped female founders grow their businesses rapidly using equity funding.
Doctify is a healthtech platform that empowers patients to find the right specialist doctor to suit their needs, view profiles of them and rate their experience.
It is the brainchild of co-founder Dr Stephanie Eltz, who realised how difficult it was for patients to find the right specialist. She then took eight months off work to partner with her colleague Dr Suman Saha to create Doctify in 2014.
British Business Bank’s Enterprise Capital Fund partner, Amadeus, has led two funding rounds in Doctify, with funding used to develop the product, build the executive team and fuel growth.
Today, Doctify has an estimated turnover of more than £150m and employs 15 people, with sales doubling every year for the past three years. Patients can search, compare and book an appropriate health specialist for 47 different medical specialities, including cardiology, oncology and paediatrics, as well as dentistry and dermatology. The team is now looking to enter new markets.
Kerry Weaver and Angela de Manzanos are the female founders of FungiAlert which develops tools that allow for the early detection of plant diseases in soil.
Over two funding rounds led by Bank partner Sussex Place Ventures’ Enterprise Capital Fund, they were able to hire three new team members, purchase key equipment and undertake extensive field trials. The funding allowed them to launch their first product in January 2019, and go on to build an experienced sales team, support on-going product development research and to expand internationally.
These are just two examples of the progress being made in supporting female innovation in life sciences, and the Bank has recently set up a new £2.5bn subsidiary, British Patient Capital, designed to enable long-term investment in high-growth potential companies in the UK.
As well as providing substantial finance to innovative ambitious companies, BPC is committed to improving diversity in the VC industry. This includes properly analysing the issue and publishing research and recommendations on diversity in the UK entrepreneurial population by the end of 2020, and investing in new fund managers with approaches and networks outside the norm.
BPC has also adopted the recently launched Institutional Limited Partner Association (ILPA) diversity template for venture capital firms applying for its programmes. The new template, part of an expansion of ILPA’s due diligence questionnaire, enables venture capital teams to measure and report the gender and ethnic diversity of their teams by seniority and role, and aims to encourage conversations about issues around diversity.
There is growing consensus that embracing diversity is a critical success factor for high performing teams and innovative new businesses. The bioscience sector shows encouraging signs of progress in this area, but it is important to build on that so talented female entrepreneurs in the field can secure the right kind of investment, at the right time, to enable their business to grow and prosper.