Entrepreneurship fuels economic growth. Increasing the number of entrepreneurs, and creating conditions for them to succeed, has the potential to improve economic opportunities in our region.
While more women sought and found employment in greater numbers, their participation as entrepreneurs were uneven. Fewer women became entrepreneurs, meaning their potential contributions to job creation, innovation, and economic growth were unrealized. Today, women remain underrepresented among the ranks of entrepreneurs.
We’ve come a long way, but we still have a long way to go.
This discrepancy is not just a gender or fairness issue—it is an issue of economic growth. This shortage of women entrepreneurs is a missed opportunity. By addressing the gender gap in entrepreneurship, policymakers can unleash a wealth of ingenuity and creativity that can spark a new era of entrepreneur-led growth in our region.
Are men really better risk-takers than women?
A study by the Kaufman Foundation finds women entrepreneurs bring particular sets of skills that not only set them apart from their male counterparts but also lend themselves to being successful entrepreneurs. One of which is that women display greater ambitions to become serial entrepreneurs than their male counterparts. The study concluded that risk-taking is not a man’s thing. Everyone is a risk-taker—and therefore, everyone has the power to use uncertainty to their advantage.
In her book “The Art of Risk”, Kayt Sukel, explained that what scientists are learning is that risky behavior is always going to be a combination of nature and nurture. Some of us, regardless of gender, have a neurobiological predisposition that pushes us towards more impulsive behavior. But our environments have quite a bit to say about whether we are able to answer that push and actually get out there and go for it.
Women face unique barriers to entrepreneurship
Mentors are in Short Supply.
One of the key challenges facing women entrepreneurs in their business is the lack of available mentors. Mentorship plays an important role in developing successful entrepreneurs, for both men and women. If women are unable to find mentors, they may fail to reach their full entrepreneurial potential.
Entrepreneurship is Perceived as a Masculine Activity
Research has shown that there is an implicit bias against women as entrepreneurs, where people are less likely to believe that women have the skills to succeed as entrepreneurs. This perception makes it harder for women entrepreneurs to secure funding. In addition, this cultural assumption that entrepreneurship is a masculine activity might discourage women from considering entrepreneurship in the first place.
Women Face Additional Hurdles Maintaining a Work-Life Balance
Nearly three-quarters of births are to women between the ages of twenty and thirty four. Women face additional pressures due to parenthood that result in lower rates of entrepreneurship.
Women tend to be asked different questions by investors
Research showed that investors and venture capitalists tended to ask men questions about the potential for gains and women about the potential for losses. There’s evidence of this bias with both male and female venture capitalists. This type of questioning has substantial funding consequences.
What motivates women to start a business?
Research shows that most men and women are motivated by the same five financial and psychological factors:
- The desire to build wealth
- The wish to capitalize on business ideas they had
- The appeal of start-up culture
- A long-standing desire to own their own company
- Working for someone else did not appeal to them
How women entrepreneurs differ from counterparts?
In general, female entrepreneurs share the following characteristics in comparison to their male counterparts:
- Women seek to make a social contribution. Women are more focused on the greater good. This connection to the community also manifests itself in the products and services themselves—women want them to be beneficial to others, to make a difference.
- One area where women struggle is they appear to display a greater tendency to be self-critical than men when faced with failure. Men are much more likely to blame market factors, the economy, or even employee issues for any kind of setback, while women often internalize the failure, blaming themselves.
- Women are less afraid to ask for help when they need it. This is where men are more comfortable doing it alone, but that may not always work. Women are more likely to get another set of eyes to look for solutions or seek another perspective. This shows a vulnerability that creates a better, more open working environment, which can only help make the success that much more rewarding.
Startup tips for women entrepreneurs
Find a mentor
Mentors are scarce. But there are still some out there who will be willing to guide and support. These mentors will not seek to find a mentee. It’s the other way around. Don’t expect others to give you a pass because you’re a woman. Your idea or product has to be a winner. One mentor may not be sufficient to help and support. So the aim is to find at least 3 mentors. This will not only be crucial at the startup phase, but also at the scale up and growth phase.
One of the advantages men have is a strong network. Having a group of people where you can find support, answers, encouragement and tangible help is central to your survival, success, and growth.
Know your strengths
Stop undermining your capabilities. Learn how to create your own personal brand. If you’re hesitant about your own worth, you’re dead in the water.
Test before you invest
Do your market research. If you have always wanted to open a bookstore but live in a town with ten of them you might think twice about this being your business choice. Successful businesses are those that fulfill a need for the community or public. So before you fall in love with an idea, prove that it is workable and bankable. If people like it, they will support it and fund it.
Write a business plan
This is an intense process but necessary. Spend time on the plan. If you need help, there are a number of entities that provide consultancy, advisory, and guidance for new startups.
Entrepreneurship is a game of risk and chance. Don’t be afraid to fail, it’s not the end of the world. Men fail all the time. Entrepreneurship is an unbelievable learning and personal growth process that depends on taking little risks every day and celebrating the little successes. It’s a learning process. The best time to begin your new business is usually now and you learn as you go.
Don’t do it alone
Your target market will definitely deal with other businesses who do not compete with you. If you are a florist, for example, you may benefit from building strategic partnerships with an event planner, a caterer, gift cards seller, and so on. This will save you a ton of money and time when launching your business.
Monitor role models
It may be worth paying attention to those who made it. There are plenty of success stories of women entrepreneurs. Monitor those success stories, encourage and support those women, connect with them, follow them on social media, get inspired by and learn from them.
The economic empowerment of women and the rise of the entrepreneurial economy are two defining trends of our time. While women are making strides to start their businesses, it is the role of policymakers to unleash more opportunities for women to contribute to the region’s economic growth by intentionally removing the barriers facing women entrepreneurship. Let’s make supporting women entrepreneurship a priority for the good of the economy.