The current quarterly figures on the Australian startup scene lastly put numbers to what everybody has been feeling of their bones for months: the vibes are off.
Enterprise capital funding plunged to an 18-month low, with Q2 2025 clocking in as one of many weakest funding intervals in current reminiscence.
This can be a main reversal from the beginning of the 12 months, when issues regarded extra on par with the glory days of 2022.
Fortunately, there may be some constructive sentiment and cautious optimism nonetheless in air, which is great- until, in fact, you’re a feminine founder aside from Airwallex’s Lucy Liu.
For girls, this downturn feels extra like a gale than a headwind; and it’s painfully clear simply how little progress has been made.
The funding local weather
Right here’s the spotlight reel by way of Lower By Ventures:
- Australian startups raised $812 million throughout 76 offers in Q2 2025.
- That’s an 8% drop from Q1, and a 47% nosedive year-on-year.
- Offers are at a two-year low. Solely two firms (Airwallex and RayGen) nabbed rounds over $50 mill.
- Strip out Airwallex’s $232 million Sequence F, and the panorama appears fairly dusty.
What’s driving the drop? An period of investor warning (macro-economic developments, and so on and so on) is making bigger rounds troublesome to return by. Early-stage (angel to seed) offers are nonetheless transferring, however the urge for food for larger bets is principally gone.
Buyers being extra cautious than within the days of “progress in any respect prices” is in itself not essentially a nasty thing- nevertheless it’s not nice should you’re anybody attempting to lift with out becoming the ‘conventional’ VC mould.
Ladies in startups
I’ll preface this half with some self-awareness. After I learn these stats, my first impulse was to take them at face worth and begin ranting on-line.
Nevertheless, I paused (and that’s progress) and took the time to dig a bit deeper. As a result of I do know I, like everybody else, am working with a specific amount of my very own bias as I transfer by way of the world every day.
So I bought into a number of the analysis* within the hope that possibly, simply possibly, there was a extra harmless rationalization for these dire numbers?
Spoiler: there isn’t actually, sorry. Ladies make up a dynamic, enthusiastic, and rising chunk of Australia’s entrepreneurial neighborhood, however are nonetheless dramatically underfunded- and largely not for causes inside their management.
The break down:
- Ladies are on the beginning line: 30–40% of Angel to Seed spherical offers have ladies within the staff.
- The squeeze occurs because the stakes rise: Feminine-only founder groups attracted simply 0.5% of whole capital in Q2 2025- actually the bottom on document.
- Solely 11 of the 76 offers this quarter concerned feminine founders in any respect.
- Exclude Airwallex’s mega-deal, and solely $29m went to mixed-gender groups of the remaining $580m.
That’s $551m to all-male groups, $4m to all-female ones
Yikes! Let’s zoom out a contact to take a look at the trajectory we’re on:
- 2023: 3% of funding went to female-only groups
- 2024: 2% of funding went to female-only groups
- 2025: 0.5% of funding went to female-only groups
Are we transferring in the proper path? You may reply that for me.
Limitations from Seed to scale-up
So, why aren’t extra women-led start-ups breaking by way of? The obstacles are each structural and cultural, they usually’re sticky.
- Underrepresentation in Tech and VC: The boys’ membership is alive and effectively. Most traders are males, and the tech sector itself is broadly identified to battle with variety. This lack of illustration shapes alternatives and funding selections, and retains ladies out of the rooms the place it occurs**.
- Community Limitations: Later-stage funding is commonly all about who you realize. If you happen to’re not already in the proper circles (see above), you’re taking part in the sport on onerous mode.
- Useful resource Disparities and Uneven Efficiency Expectations: Even when women-led start-ups get funding, it’s normally much less. They usually usually should outperform their male friends simply to get the identical (or smaller) cheques.
- Sector Preferences: This one I like, as a result of it’s one thing ladies can take extra management of. Ladies usually tend to construct in retail, well being, or private providers sectors- nonetheless enormous potential, however areas that VCs traditionally don’t favour as a lot. Latest curiosity is focused to fintech, climatech, biotech, AI (obvs). So what alternatives can ladies discover to hyperlink their experience to those different high-demand progress arenas?
- Visibility: It’s onerous for girls to be taken significantly and generate actual alternative when publicity and dialog is so centred on the massive gamers within the sport. Cool, you bought a quote from a man at Amazon. However so did a bunch of different folks. We all know what they’re doing, so who else is on the market? Who’s driving actual innovation, as an alternative of searching for the most effective pursuits of their shareholders? Who are you able to platform that actually deserves it?
- Simply Plain Bias: Okay, I do know nobody likes to speak about it, however bias is actual. Research present feminine founders get grilled with “prevention-oriented” questions (all about danger) throughout funding pitches, whereas males get “promotion-oriented” ones (all about upside). The end result? Extra conservative presents, much less gasoline for progress.
The case for numerous management
Why do you have to care? Perhaps you’re unbothered by the established order (daring selection).
However right here’s the factor: the enterprise case for funding women-led startups is rock stable. Firms with numerous management don’t simply look good, they typically outperform their much less numerous friends, with stronger monetary returns, extra innovation, happier shareholders.
Investing in ladies isn’t simply cool, it’s good. (But additionally sure, very cool.)
Methods for funding fairness
Actually, I do know the constructive method can be to place options right here. However I really feel like they’re on the market already, and largely effectively understood.
So, I believe maybe this submit was a chance to vent a bit of in spite of everything, but additionally to remind those who we haven’t truly achieved gender fairness on this atmosphere, and I encourage you all to not take your eye off the ball. I don’t have the ability, cash, or affect to maneuver the needle- but when somebody studying this does- please go speak the speak, and stroll the stroll.
Australia’s funding droop isn’t simply one other market cycle, it’s a stress check. We’re about to endure an entire whole industrial revolution and my hope is for it to learn the numerous, not the few. We’re vulnerable to locking in inequities that might turn out to be very troublesome to undo.
There’s plenty of untapped potential on the market, ready to be unlocked.
*Please don’t come at me if I’ve missed any particular analysis, there actually is barely a lot time within the day.
**A nod to the Hamilton followers on the market.
- Roisin O’Neill is the cofounder of Neoma, a women-led startup, on a mission to help extra ladies into tech roles.
