As two of the world’s largest AI startups, OpenAI and Anthropic, establish new offices in London, the UK tech scene appears to be thriving. But women founders are experiencing a significant VC funding gap.
According to a report released by the House of Commons Women and Equalities Committee in 2025, just 2% of equity investment went to female founders in 2024, while all-male teams received over 80% of capital allocated. The report also noted that women were heavily underrepresented in fields including AI, fintech, and deep tech.
The last Census found women and girls made up 30.4 million (51.0%) of the population of England and Wales – the fact that so little equity investment went towards these founders raises serious questions about the equality of funding in the country.
Case in point, the much-hyped Sovereign AI Fund recently announced the first cohort of companies to receive support from its £500 million fund, and included just two startups with female founders.
Read more: The UK’s Sovereign AI Initiative: Is a fund going to save the tech scene?
More broadly, the data points to a lack of visibility and access to opportunities for women entrepreneurs.
Diving Into The Funding Gap
With the recent establishment of the Sovereign AI Fund and moves by Anthropic and OpenAI to establish offices in the country, there’s been lots of hype around the potential of the UK tech scene – which recently raised $7.5 billion dollars USD in Q1 2026, making it the second-highest funded country in the world during the study period.
However, many are critical of the distribution of VC funding in the country. Angie Madara, founder of analytical investment platform AthenaFundX said:
“Honestly? It’s a scene that talks a good game but still moves too slowly. Female founders in the UK receive less than 2% of all venture capital, and that figure has barely shifted in a decade.”
“The British Business Bank’s recent £1 million commitment to co-invest alongside Angel Academe is welcome, but let’s be clear: £1 million is a signal, not a solution. The gap we’re talking about is systemic, structural, and worth billions. The ecosystem knows it. The question is whether the urgency is finally matching the rhetoric,” Madara added.
In early May, the British Business Bank (BBB) announced a £1 million commitment to Angel Academe, a UK-based angel network, to co-invest in select deals through the network’s EIS Fund, which targets female-founded companies.
Regardless, Madara says that she’s deeply concerned about the availability of funding to female founders, and has been building AthenaFundX precisely because she watched exceptional women with fundable businesses get overlooked – not because their businesses weren’t investment-ready, but because the infrastructure to surface them to the right investors didn’t exist.
“The problem isn’t a shortage of talented women founders. It’s a shortage of the right visibility and vetting infrastructure. The Barclays estimate puts the gender entrepreneurship gap at a £310 billion-opportunity for the UK economy. We’re not just failing women founders, we’re failing ourselves economically,” Madara said.
The AI Gap
In addition to the funding gap itself, others in the tech ecosystem point to structural barriers in AI adoption. An April 2026 report by the Cherie Blair Foundation for Women, which surveyed 3,072 women entrepreneurs across 66 low and middle income countries, found that despite AI use more than doubling from 38% to 82%, AI adoption “remains strongly gendered, even in contexts where access to digital infrastructure and skills is relatively universal.
The report also recommended targeted action to address systemic barriers holding women back from adoption – chief among them a lack of skills, confidence, and capacity to experiment – as well as better-designed tools for SMEs.
“Women entrepreneurs across the world face a familiar set of structural barriers: access to finance, networks, markets, skills and time. Even closer to home, in a country with comparatively strong institutions and equality protections, female-led businesses in the UK still receive only around 2% of VC funding,” Rachel Seftel, head of research and impact at the Cherie Blair Foundation for Women, told European Business Magazine.
Seftel notes that AI may create new inequalities not simply in who has access, but in who is able to use it in functions like finance or operations. This means that while women are adopting AI at scale, the gains are uneven.
“This gap illustrates well how the barrier women entrepreneurs face compound. The same structural constraints that affect women’s businesses everyday – limited time, limited capital, less access to skills and training – also shape whether they can integrate AI into the parts of the business where they can benefit the most,” Seftel said.
She adds that there needs to be a lower cost of experimentation with AI, arguing that women are already carrying disproportionate caregiving responsibilities; training opportunities that ignore their time constraints are unlikely to work.
At a policy level, Seftel calls for real action to address structural gender inequalities, including care responsibilities and access to capital.
What Can Be Done?
Increasing access to VC capital is a tall task that the government has aimed to address in the past with initiatives like the Investing in Women Code (IWC), which aims to support women-led businesses.
However, these efforts haven’t fully addressed the issue. Madara says that voluntary commitments are useful but ultimately insufficient.
She argues that a number of things can be done to support female founders, including public funds having enforceable diversity requirements tied to capital allocation.
Madera also noted the importance of fixing the infrastructure layer. More specifically, there is a need to “treat time as infrastructure.”
“We heard this at the Cherie Blair Foundation’s recent launch of [the report] ‘Adopted not Embedded’; women entrepreneurs aren’t failing to adopt AI because of lack of skill or confidence – it’s time poverty. Any intervention that doesn’t account for the disproportionate time burden on women entrepreneurs will underdeliver.”
Women founders are underfunded not solely due to bias but also because of visibility, too, she added. Platforms that identify women-led tech businesses to get them in front of institutional investors are all the more critical.
Featured image: Getty Images via Unsplash+
