41
Chapter 3
Women and Entrepreneurship
3.1 Introduction
As of 2013, it is estimated that there are over 8.6 million female-owned
businesses in the U.S., generating over $1.3 trillion in revenues and employ-
ing nearly 7.8 million people. Between 1997 and 2013, while the number of
businesses in the U.S. increased by 41%, the number of women-owned rms
increased by 59%—a rate 1.5 times the national average.
1
Studies show that entrepreneurial activity by women varies widely across
the world. However, women show nearly double the rate of early-stage
entrepreneurship in middle-income countries than in high-income countries.
These women are highly motivated by opportunity and necessity in middle-
income countries.
2
While male and female founder-entrepreneurs share some basic charac-
teristics, there are some major differences,
3
as shown in Table3.1.
3.2 Global Impact of Women Entrepreneurs
“You’ve come a long way, baby!”—Advertisement
According to a report
4
by the Organization for Economic Co-operation and
Development (OECD),
5
the number of female entrepreneurs as a share of
total was reported as seen in Figure3.1.
42 ◾ The Guide to Entrepreneurship: How to Create Wealth for Your Company
The same report focuses on women and technology because science and
technology (S&T) background is a key resource in today’s knowledge-based
economies. The report concludes,
“Science and technology gender gaps relate more to attitudes than
to aptitudes. Boys are more likely than girls to choose science
subjects to study in higher education…. Girls are much less likely
to major in computer science, engineering or physical sciences.
Although women receive more than half of university degrees in
the OECD countries, women account for 30% of degrees in S&T.”
The 2nd OECD conference
6
presented data comparing the relationship
between self-employed women and men in 28 OECD economies.
We can assume that many of the self-employed women in Figure3.3
qualify as entrepreneurs under our standard denition. This provides us
with a feeling for the substantial economic impact that female entrepreneurs
are having throughout the world.
Table3.1
Characteristics Female Male
Level of formal education High High
Desire to start own business High High
Entrepreneurial experience Medium High
Access to capital Low High
Mentored by a known industry guru Low High
Hindered by family obligations High Low
Consider prior experience
important
High Medium
Feel pressure to be family
breadwinner
Low High
Co-founder important to success High Medium
Desire to build wealth High High
Working for themselves High High
Encouragement by peers High Low
Having an entrepreneurial friend as
a role model
High Medium
Women and Entrepreneurship ◾ 43
3.3 Personal Challenges Faced by Female Entrepreneurs
“Start small and dream big.” —Rich Dad, Poor Dad
By its very nature, entrepreneurship poses signicant personal challenges,
including money, time, and family pressure. Those challengers can be par-
ticularly acute for women, especially those with young children. Moreover,
with women starting their own businesses at an increasing rate, understand-
ing the challenges is an important component of success.
Currently female entrepreneurs own almost half of all small businesses in the
U.S. The steady rise in female entrepreneurs can be attributed to several factors,
most of which share the same rationale as their male counterparts, such as:
◾ passion for their ideas
◾ desire for economic independence
◾ dissatisfaction with current job
◾ need to engage in philanthropic causes
◾ social imperatives
3.4 Women and Success
“I nd that when you have a real interest in life and a curious life,
that sleep is not the most important thing.” —Martha Stewart
In her seminal 1974 book Women & Success: The Anatomy of Achievement,
Ruth B. Kundsin
7
asks:
If a female Einstein existed in the United States today, would
she be recognized? Would she be at the Princeton Institute for
Advanced Studies? Would she get a National Science Foundation
grant? Would she be listed in Who’s Who? Or would she be found
in a neat suburban house washing her husband’s socks, practic-
ing Craig Claiborne’s recipes and imbibing dry martinis in the
afternoon with anger mounting in her heart toward her family, her
friends and the faculty at the college where she majored in physics?
Another challenge is that women’s success hinges on the fact that they are
asked to demonstrate competence in a variety of roles, both as women as well
44 ◾ The Guide to Entrepreneurship: How to Create Wealth for Your Company
as in their occupations. Occupational excellence is insufcient. Men, on the
other hand, succeed primarily based on occupational and nancial competence.
3.4.1 Dening Success
“Obstacles always precede opportunities.”
In the context of this Guide, success will be dened as the unhindered
ability to function in a chosen profession with some measure of peer recog-
nition. According to this denition, by the mid-2010s women have indeed
achieved success given that female entrepreneurs own almost half of all busi-
nesses in the U.S., contribute to the overall employment of 18 million work-
ers, and generate anywhere from $2 to $3 trillion in U.S. economy revenues.
8
3.4.2 Twenty-Five Leading Female CEOs
According to Catalyst, a non-prot organization, female CEOs are running
Fortune 500 companies, including IBM and PepsiCo.The number has tripled
since 2002–2003. The 2012 Fortune’s annual ranking of America’s leading
businesswomen lists the following:
Rank6— >▾ Name Company
1 Ginni Rometty IBM
2 Indra Nooyi PepsiCo
3 Meg Whitman Hewlett-Packard
4 Irene Rosenfeld Kraft Foods
5 Ellen Kullman DuPont
6 Patricia Woertz ADM
7 Ursula Burns Xerox
8 Sheryl Sandberg Facebook
9 Abigail Johnson Fidelity Investments
10 Safra Catz Oracle
11 Melanie Healey P&G
12 Anne Sweeney Disney/ABC Television Group
Women and Entrepreneurship ◾ 45
13 Rosalind Brewer Wal-Mart Stores
14 Marissa Mayer Yahoo
15 Carol Meyrowitz TJX Cos.
16 Phebe Novakovic General Dynamics
17 Sheri McCoy Avon Products
18 Susan Wojcicki Google
19 Marillyn Hewson Lockheed Martin
20 Denise Morrison Campbell Soup Co.
21 Gisel Ruiz Wal-Mart Stores
22 Carrie Tolstedt Wells Fargo
23 Bridget Van Kralingen IBM
24 Mary Callahan Erdoes JP Morgan Chase
25 Jan Fields McDonald’s USA
3.5 Hurdles to Overcome
“You’ll miss 100% of the bat swings you don’t take.”
Although women are launching businesses at record pace, they still have
an upward climb.Only 29% of the small business loan applicants on
Biz2Credit’s online platform are from women.Research has found that small
business loan approval rates for female-owned companies are 15 to 20%
lower than they are for male-owned companies.
9
According to Biz2Credit, there are three possible reasons why the loan
approval rates for female-owned business are lagging:
1. Female-owned companies are often newer businesses.They have
not established the same track record of success simply because they
have not been operating as long as male-owned rms have.
2. Many female-owned businesses are in industries that banks are
wary of funding, such as nail salons, beauty parlors, and retail fran-
chises. Bankers are not as familiar with the operation of some of these
companies, and the industries are perceived as more risky than others are.
..................Content has been hidden....................
You can't read the all page of ebook, please click here login for view all page.