The “Exit Gap” reveals a troubling disparity in the sale of businesses founded by women, highlighting significant challenges when it comes to exiting their companies and realizing their true value.

Original article appeared in Forbes by Lien De Pau.

A recent report by The Big Exit shows that less than 1% of businesses sold were founded by women, and female-founded businesses are valued 30% lower on average than those founded by men. This gap is even more pronounced in certain sectors: male-founded businesses in Technology, Media, and Telecommunications (TMT) are valued 1.5 times higher than female-founded ones, while the consumer sector shows an 18% higher valuation for male-owned businesses.

Addressing this gap requires a multi-faceted approach. Women entrepreneurs can employ several strategies to enhance their exit outcomes: obtaining independent valuations can help avoid undervaluation and provide a stronger basis for negotiation, building networks with female-led private equity firms and experienced women entrepreneurs can offer crucial insights and support, and preparing early for the exit process allows for strategic decision-making that maximizes business value.

Closing the exit gap is not only about achieving fair valuations but also about ensuring that women entrepreneurs are recognized and rewarded for their contributions to the business world. As more women achieve successful exits at equitable valuations, they become role models for future generations, creating a ripple effect that can shift perceptions and foster a more inclusive business environment. While the path to closing the gap may be long, targeted strategies and collective effort can help build a more equitable future where all entrepreneurs have an equal opportunity to succeed.

Head over to Forbes to read the full article by Lien De Pau.