Morgan Stanley
  • Research
  • September 23, 2021

Women in Tech: Moving the Dial in Gender Equality

What are the opportunities and challenges facing women who are founding, leading and investing in Australian technology firms?

Australia’s place on the world stage as an incubator of high growth companies is gaining global attention. Start-ups co-founded by women in Australia received 20% venture capital funding in the first half of 2021, which is up from 15% from prior years. However, there remains a substantial opportunity to increase funding and investing by women for women.

The gender pay gap is well documented, but the gender investment gap is less well known. BCG research found that when women business owners pitch their ideas to investors for early stage capital, they received significantly less funding than male counterparts. Yet businesses founded by women ultimately deliver higher revenue, up to two times as much. Doesn’t this mean it should pay to invest in female founded businesses both for the founders and the investors?

As part of Morgan Stanley’s annual Australia Summit, a panel discussion was hosted by Emma-Jane Newton, Managing Director in Morgan Stanley Australia’s Investment Banking Division, focusing on “Women in Tech”. She was joined by:

  • Justin Ryan, Chair and Non-Executive Director, Adore Beauty
  • Lucinda Hankin, Director - Private Investments, Grok Ventures
  • Jackie Vullinghs, Partner, AirTree
  • Kristy Chong, CEO and Founder, Modibodi

The panellists discussed the opportunities and challenges facing women who are founding, leading and investing in Australian technology firms.

Female led start-ups

Globally the investment in female led start-ups is about 3% and that statistic is similar in Australia. Kristy Chong, Founder of Modibodi shared what it’s like to be a founder in this market and how she navigated her way through finding capital. Initially Kristy didn’t have much of a financial background and little knowledge of the venture capital world so she went out to friends and family, where she came across someone who invested $200,000 as an angel investor. From there, she grew her business by completing a financial literacy program and connecting with advisers, who helped her network with other angel investors. Her advice to other females is to know your numbers, ramp up your negotiation skills, and have advisers to help with networking.

From the perspective of a venture capital firm, Jackie mentioned at AirTree they look for founding teams that have complementary skillsets across product, technology and growth. They need to have unique insights into the problem they are solving and a clear reason why no one has solved this before. They also look for rapidly emerging markets where you can build a very large business over the next ten years and build a long term, sustainable competitive advantage in the market. 

Do women pitch their stories differently to men?

While the panellists agreed it is hard to specifically call out the differences across a whole gender and that all propositions are based on merit, Jackie did point out they notice women often tend to pitch the most realistic version of their plan while men will pitch the most optimistic version of their plan. Lucinda mentioned with female founders, there is higher level of thoroughness, depth of understanding of the issues and empathy for the customer and the problem.

Focusing on values, purpose and culture

Justin had great success backing female-led high growth businesses including Adore Beauty and Modibodi. An important factor that stood out for Justin in these businesses is the focus on values, purpose and culture. This means a deeper care about the future, decisions made based on values, and a greater purpose than just making money. This is vital as a significant portion of customers, including the emerging group, treasure the values that businesses have. Consumer goods in particular have quick feedback loops from customers, and female founders are in touch in what the customers are after. Justin believes most businesses led by women are ahead of their time in terms of where the future is going. 

Moving the dial in gender equality

It is evident investors are demanding more diversity globally, so what can be done to move the dial in gender equality? The common themes discussed among the panellists were around the importance of accessibility of opportunities and education to women. Lucinda said she is optimistic that an increase of representation at the senior level in the venture capital community will help inspire the next cohort of women investment decision makers. She believes success begets success in the start-up ecosystem and that recruiting more women into these roles encourages a diverse representation.


For more from Morgan Stanley’s Australia Summit and insights into disruption, speak to your Morgan Stanley financial adviser or representative.