One in four startup leaders is a woman
Women make up just over 30 percent of employees in Finnish startups, but this is not reflected in leadership positions. In 2022, only 26 percent of employees with a “Director” title in startup companies were women.
The analysis by the Finnish Startup Community is based on register data from Statistics Finland. Leadership was examined based on occupational titles. Among those with a “Director” title, the share of women is clearly lower than their share of the overall startup workforce. In 2022, a total of 717 women held director-level positions, accounting for 26 percent of all startup employees with a director title.
For comparison, according to an estimate by the Finnish business think tank EVA, women accounted for approximately 36 percent of leaders across the entire Finnish labour market in 2022.
“It is positive that the trend is moving in the right direction. The share of women is steadily increasing in startup companies, both as founders and in other roles. However, there is still a way to go before reaching full equality, and continued efforts are needed”, says Riikka Pakarinen, CEO of the Finnish Startup Community.
Women’s educational attainment in Finland has surpassed that of men during the 2000s, and this is also visible in the startup ecosystem. In 2022, women accounted for 34 percent of startup employees holding at least a bachelor’s degree, compared to 30 percent among those with a lower level of education.
“The educational structure suggests that women’s underrepresentation in leadership roles cannot be explained by competence or educational background. The differences appear to relate to career paths, titles and internal company structures. Strong role models as well as broader societal changes, such as parental leave arrangements that distribute responsibility more evenly, play a key role. Work in startups is often intense, so it is important that society provides support and networks to help reconcile family life with irregular working hours — for both men and, increasingly, women”, Pakarinen continues.
Company age matters
The number of women working in startups has grown significantly over the past two decades. In 2005, approximately 1,150 women were employed in startups, compared to nearly 13,300 in 2022. However, their relative share of the total workforce has remained fairly stable over the long term.
The share of women also varies depending on the age of the company. In early-stage startups, women account for approximately 21 percent of employees on average. In more established startup companies, the share rises to over 30 percent.
This suggests that women are recruited in relatively greater numbers as companies grow. It is also possible that in the earliest stages of a startup, workforce needs are more focused on technology development, which is traditionally a male-dominated field.
The gender pay gap remains significant
The gender pay gap in the startup sector remains substantial. In 2022, the average annual earned income of women working in startups was approximately €48,200, compared to approximately €65,600 for men. When looking at median income, the gap was somewhat smaller: the median income for women in startup-based companies was approximately €41,800, compared to €53,800 for men.
“The relative pay gap has narrowed slightly between 2005 and 2022, but it remains high. In 2005, women’s earnings were approximately 70 percent of men’s earnings, and in 2022 the corresponding figure was around 74 percent. In this analysis, pay differences have not been adjusted for job role, work experience or educational background. Even so, the relative pay gap appears quite significant in the startup sector. The entire industry must continue working to address this”, says Youssef Zad, Chief Economist of the Finnish Startup Community.