{"id":1247,"date":"2017-03-08T14:15:38","date_gmt":"2017-03-08T19:15:38","guid":{"rendered":"http:\/\/mcnair.bakerinstitute.org\/blog\/?p=1247"},"modified":"2020-10-15T11:57:37","modified_gmt":"2020-10-15T15:57:37","slug":"wanted-more-women","status":"publish","type":"post","link":"https:\/\/www.edegan.com\/articles\/wanted-more-women\/","title":{"rendered":"Wanted: More Women Entrepreneurs"},"content":{"rendered":"

Introduction<\/h3>\n

The increase of women in the workforce in the twentieth century drove U.S. GDP growth to new highs. However, as U.S. growth slowed, so did the rate of women entering the workforce. Pushing for equal representation in fields where women have been historically underrepresented may be the key to stimulating our economy.<\/p>\n

Women\u2019s entrepreneurship is one of these fields. Lauded by the Kauffman Foundation<\/a> as an “economic tailwind\u00a0that will give a boost to twenty-first-century growth” in the global economy, there is a lot of excitement surrounding the potential of women in entrepreneurship. By looking at characteristics of successful women entrepreneurs, we may gain a better understanding of how to make entrepreneurship more accessible to women.<\/p>\n

Characteristics of Successful Women Entrepreneurs<\/h3>\n

The Kauffman Foundation and Stanford University<\/a> uncovered some interesting results by surveying 350 founding CEOs, presidents, chief technology officers, and leading technologists of tech startups founded between 2002 and 2012. First, women in tech entrepreneurship are highly educated. Ninety-four percent have at least a bachelor\u2019s degree and 56 percent have graduate degrees. Their educational training centers around business, the liberal arts, and STEM. Female entrepreneurs clearly represent a highly educated slice of the population. In comparison, only 33 percent<\/a> of women in the United States possess a bachelor\u2019s degree or higher; further, only 12 percent<\/a> of women possess a graduate degree.<\/p>\n

Performance<\/h3>\n

Research shows that female entrepreneurs experience success. On average, female entrepreneurs of all types (not just tech industries) perform seven percent better<\/a> on the Kauffman Opportunity Entrepreneurship Share than male entrepreneurs. The KOES tracks the percent of new entrepreneurs who come from prior employment each year; these entrepreneurs leave their jobs to start businesses because they identified market opportunities. This indicates that women are better at identifying the market “gaps” where entrepreneurs thrive. Furthermore, women start their equally successful companies with 50 percent less capital<\/a> than their male counterparts.<\/p>\n

Nonetheless, some research finds that women entrepreneurs perform worse than men. Studies by Fundera found that women-owned businesses earn 30 percent less annual revenue<\/a> than men. This could be creating a vicious circle, though; when companies make lower revenue, it is harder to access credit, making it more difficult to increase revenue in the future.<\/p>\n

Gender Gaps<\/h3>\n

If women entrepreneurs tend to experience success, why are there so few women involved in entrepreneurship as a whole? Female-owned businesses only represent 16 percent of employing firms. Even then, these firms tend to be small, usually with employee counts in the single digits. Among high-growth, high-technology firms, women represent a mere 10 percent of founders.<\/p>\n

\"https:\/\/www.flickr.com\/photos\/ges2016\/27831680936\"
Penny Pritzker (U.S. Department of Commerce Secretary), Ruth Porat (CFO and Senior Vice President of Google and Alphabet Inc), and Ann H. Lamont (Managing Partner at Oak HC\/FT) speak at the Global Entrepreneurship Summit in June 2016<\/figcaption><\/figure>\n

Female entrepreneurs cite lack of available financial capital, lack of mentors or advisors, and the high requirements for time and effort as some of the toughest\u00a0challenges<\/a> in starting their businesses. Seventy-nine percent of women surveyed by the Kauffman Foundation reported using their own personal funds to start their business.<\/p>\n

Male founders are more than three times as likely as female founders to secure financing through angel donors or VCs. Research at Babson College<\/a> indicates that this difference may be linked to gender discrimination: “Because women entrepreneurs do not conform to the \u2018role\u2019 of the entrepreneur in the high growth venture, role incongruity may lead to greater perceived risk on the part of venture capital investors.”<\/p>\n

Supporting Female Entrepreneurs<\/h3>\n

If women entrepreneurs are unable to secure funding on an equal basis with men, it may be impossible to ever see equal gender representation in entrepreneurship. We need to address gender-based biases of VC firms and other investors. Recruiting more women to the venture capital industry could help reduce unintended gender discrimination when making investments. Employee bias training programs may also help in this process.<\/p>\n

Private and nonprofit efforts to encourage women\u2019s leadership and entrepreneurship can be helpful as well. Initiatives like Women\u2019s Entrepreneurship Day<\/a>, the Women\u2019s Entrepreneur Festival<\/a>, and the Microsoft\u2019s Women Think Next<\/a> network are all examples of non-governmental programs that try to address women\u2019s representation issues. Lean In Circles<\/a>\u2014small support groups made up of women in local communities and around the world\u2014 also serve as valuable tools to promote women\u2019s economic involvement.<\/p>\n

Government programs may also be successful in jump-starting greater women\u2019s involvement in entrepreneurship. The City of Atlanta<\/a> provided 15 women entrepreneurs the opportunity to incubate their businesses for 15 months through their the Women\u2019s Entrepreneurship Initiative<\/a> in 2016. On a federal level, implementation of more programs like the State Department\u2019s African Women\u2019s Entrepreneurship Program<\/a> may benefit women, especially those in minority groups. One of the greatest challenges for women entrepreneurs is finding mentorship opportunities<\/a>; local and state government initiatives to pair mentors with women entrepreneurs could help address this problem.<\/p>\n

The U.S. economy is at a tipping point. In early 2016, Forbes magazine pointed out that female entrepreneurs are an “under-tapped force that can rekindle economic expansion.” However, despite strong evidence for growth potential and data supporting female entrepreneurs\u2019 power, many barriers still exist. Through integration of more women into entrepreneurship ecosystems, we can achieve a brighter economic future for all.<\/p>\n

Related Posts<\/h3>\n

To learn more about treatment of women within top tech companies, see the McNair Center\u2019s blog post here<\/a>.<\/p>\n

To learn more about women in STEM fields, see the McNair Center\u2019s blog post here<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Introduction The increase of women in the workforce in the twentieth century drove U.S. GDP growth to new highs. However, as U.S. growth slowed, so did the rate of women entering the workforce. Pushing for equal representation in fields where women have been historically underrepresented may be the key to stimulating our economy. Women\u2019s entrepreneurship…<\/p>\n","protected":false},"author":4,"featured_media":1252,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[422,110],"tags":[223,126,118,104,26,226,225,37,18,57,181,94,222,40,32,111],"class_list":["post-1247","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mcnair","category-women","tag-capital","tag-diversity","tag-entrepreneurial-ecosystem","tag-entrepreneurs","tag-entrepreneurship","tag-gender","tag-gender-gap","tag-innovation","tag-policy","tag-small-business","tag-startup","tag-stem","tag-technology","tag-vc","tag-venture-capital","tag-women"],"featured_image_urls_v2":{"full":["https:\/\/www.edegan.com\/articles\/wp-content\/uploads\/2017\/03\/27231196063_87c8925d7c_z.jpg",640,427,false],"thumbnail":["https:\/\/www.edegan.com\/articles\/wp-content\/uploads\/2017\/03\/27231196063_87c8925d7c_z-200x150.jpg",200,150,true],"medium":["https:\/\/www.edegan.com\/articles\/wp-content\/uploads\/2017\/03\/27231196063_87c8925d7c_z-400x267.jpg",400,267,true],"medium_large":["https:\/\/www.edegan.com\/articles\/wp-content\/uploads\/2017\/03\/27231196063_87c8925d7c_z.jpg",640,427,false],"large":["https:\/\/www.edegan.com\/articles\/wp-content\/uploads\/2017\/03\/27231196063_87c8925d7c_z.jpg",640,427,false],"1536x1536":["https:\/\/www.edegan.com\/articles\/wp-content\/uploads\/2017\/03\/27231196063_87c8925d7c_z.jpg",640,427,false],"2048x2048":["https:\/\/www.edegan.com\/articles\/wp-content\/uploads\/2017\/03\/27231196063_87c8925d7c_z.jpg",640,427,false],"post-thumbnail":["https:\/\/www.edegan.com\/articles\/wp-content\/uploads\/2017\/03\/27231196063_87c8925d7c_z.jpg",640,427,false],"twentytwenty-fullscreen":["https:\/\/www.edegan.com\/articles\/wp-content\/uploads\/2017\/03\/27231196063_87c8925d7c_z.jpg",640,427,false],"yarpp-thumbnail":["https:\/\/www.edegan.com\/articles\/wp-content\/uploads\/2017\/03\/27231196063_87c8925d7c_z.jpg",120,80,false]},"post_excerpt_stackable_v2":"

Introduction The increase of women in the workforce in the twentieth century drove U.S. GDP growth to new highs. However, as U.S. growth slowed, so did the rate of women entering the workforce. Pushing for equal representation in fields where women have been historically underrepresented may be the key to stimulating our economy. Women\u2019s entrepreneurship is one of these fields. Lauded by the Kauffman Foundation as an “economic tailwind\u00a0that will give a boost to twenty-first-century growth” in the global economy, there is a lot of excitement surrounding the potential of women in entrepreneurship. By looking at characteristics of successful women…<\/p>\n","category_list_v2":"McNair Center<\/a>, Women<\/a>","author_info_v2":{"name":"Dylan Dickens","url":"https:\/\/www.edegan.com\/articles\/author\/dylandickens\/"},"comments_num_v2":"2 comments","yoast_head":"\nWanted: More Women Entrepreneurs - Ed Egan<\/title>\n<meta name=\"description\" content=\"An increase in women entrepreneurs has been identified as an important potential boost in the United States economy. 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