Women entrepreneurs are a powerful part of today’s economy. Their business acumen, intelligence, and resilience are among the many reasons women make such an impactful contribution.
Here are five reasons the world needs more women entrepreneurs.
1. Women Are Job Creators
The data varies slightly, but consistently shows women comprise a growing percentage of businesses and employers:
- The 9.1 million women-owned businesses accounted for 7.9 million jobs in 2015. Those businesses generated $1.5 trillion in revenue. In 2015, women-owned companies comprise 31 percent of all privately held businesses, employ 14 percent of the work force, and generate 12 percent of total revenue.
- The Kauffman Foundation put the rate of women-owned businesses at 40 percent in 2016.
- In a 2016 report commissioned by American Express, it was estimated that women owned 11.3 million businesses, employed 8.98 million people and generated $1.6 trillion in annual revenue.
2. Women Are Good At Their Work
The Kauffman Foundation, which supports entrepreneurship, notes that women bring significant differences in their approach to business. Among the foundation’s findings:
- Women have a “more nuanced view of risk,” according to the Centre for Entrepreneurs and Barclays. Specifically:
- Women self-report as financial risk-takers at a higher rate (87 percent) compared to men (73 percent).
- Eighty percent of women say they see opportunities where others perceive risk, while only 67 percent indicate the same attitude.
- Women are concerned about taking risks they consider foolhardy that may harm their livelihoods or those of their employees.
- A higher percentage of women with C-level jobs (69 percent) want to start their own businesses within three years compared to men (29 percent).
- Women generally are more modest about their success. The Centre for Entrepreneurs study found that the surveyed women-owned businesses had higher profits but were less likely (42 percent) than men (62 percent) to describe their companies as prospering.
3. Women Make Do With Less Capital
Unfortunately, women still face biases and barriers to gaining the necessary capital to start a business. The Kauffman Foundation found women generally start their businesses with about half as much capital as their male counterparts. Women are also only a third as likely as men to access venture capital or angel investments.
While there are some federal programs designed to support women-owned businesses, there are still disparities in funding. For example, in fiscal 2013 (the most recent year available), only 15 percent of total award dollars in the federal Small Business Innovation Research program went to women-owned businesses.
4. Women Have Smaller Networks and Leverage Them Less
Kauffman reports only 5.4 percent of women are likely to tap into their personal networks of friends and acquaintances to find funding opportunities compared to men (22.7 percent).
Women also face a dearth of available mentors, citing the lack of mentors as a major deterrent, despite evidence that mentors play a critical role in entrepreneurial success.
5. Women Bear a Larger Work-Life Balance Burden
Women who run their own businesses often are still responsible for a disproportionate share of home and family responsibilities. This disparity places more stress on women who feel the pressure to be successful as business leaders, wives or partners, mothers, caregivers, and friends.
Changing the Dialogue
At Benetrends, we know women entrepreneurs are awesome. That is why we work closely with women-owned businesses to create the right business structure that lets them leverage existing retirement funds to secure start-up funding.
We provide small business funding for women by using existing 401(k) and IRA funds to create the capital that gets entrepreneurs off on the right foot. To learn more how Benetrends can help you with your funding needs, download Innovative Funding Strategies For Entrepreneurs.