Female entrepreneur

Demographic characteristics

Studies have shown that successful Women entrepreneurs start their businesses as a second or third profession. Because of their previous careers, women entrepreneurs enter the business world later on in life, around 40–60 years old. As women are now overtaking their male peers when it comes to education, having higher education degrees is one of significant characteristics that many successful female entrepreneurs have in common.

International implications

A recent international study found that women from low to middle income countries (such as Russia and the Philippines) were more likely to enter early stage entrepreneurship when compared to those of higher income countries (such as Belgium, Sweden and Australia). A significant factor that may play a role in this disparity can be contributed to the fact that women from low income countries often seek an additional means of income to support themselves and their families. Overall, 40 to 50 per cent of all small businesses are owned by women in developing countries. Alternatively, this may also be due to the fact that, in western business practices, it is not seen as beneficial to exhibit feminine traits. While eastern businesses tend to follow methods based around mutual respect and understanding, western business expectations are for business leaders to be more ruthless, headstrong and less sensitive or respectful. "In the grab for power women use whatever means available to them, whereas a man would take a club to his opponents head a woman is more likely use other less forceful and more subversive measures. Lets just own it we have different weapons in our arsenal."

Present challenges

Even though female entrepreneurship and the formation of women business networks is steadily rising, there are a number of challenges and obstacles that female entrepreneurs face. One major challenge that many women entrepreneurs may face is the traditional gender-roles society may still have on women. Entrepreneurship is still considered as a male-dominated field, and it may be difficult to surpass these conventional views. Other than dealing with the dominant stereotype, women entrepreneurs are facing several obstacles related to their businesses.

Obstacles specific to starting new firms

External finance and sex discrimination.

In general, women have lower personal financial assets than men. This means that for a given opportunity and equally capable individual, women must secure additional resources compared to men in order to exploit the opportunity because they control less capital. A question that has developed into its own sub-field in the women’s entrepreneurship literature is if women have a harder time getting finance than men for the same business opportunity.

A specific solution for solving women’s difficulties for obtaining financing has been micro financing. Micro finance is a financial institution that has become exceptionally popular especially in developing economies.

Obstacles specific to managing a small firm

Studies on women entrepreneurs show that women have to cope with stereotype attitudes towards women on a daily basis. Business relations as customers, suppliers, banks, etc. constantly remind the entrepreneur that she is different, sometimes in a positive way such as by praising her for being a successful entrepreneur even though being a woman. Employees tend to mix the perceptions of the manager with their images of female role models leading to mixed expectations on the woman manager to be a manager as well as a “mother”. The workload associated with being a small business manager is also not easily combined with taking care of children and a family. However, even if the revenues are somewhat smaller, women entrepreneurs feel more in control and happier with their situation than if they worked as an employee.

Obstacles specific to growing firms

A specific problem of women entrepreneurs seems to be their inability to achieve growth especially sales growth. Another previously addressed issue is finance and as stated previously, the entrepreneurial process is somewhat dependent on initial conditions. In other words, as women often have a difficult time to assemble external resources, they start less ambitious firms that can be financed to a greater degree by their own available resources. This also has consequences for the future growth of the firm. Basically, firms with more resources at start-up have a higher probability to grow than firms with fewer resources. By resources is meant here societal position, human resources and financial resources. This initial endowment in the firm is therefore of great importance for firm survival and especially for firm growth. Despite that many women entrepreneurs face growth barriers, they are still able to achieve substantial firm growth. There are examples of that both in a number of developing economies (Ethiopia, Tanzania and Zambia) surveyed by the ILO, as well as in more developed economies such as the United States.

Encouragement of women entrepreneurs

In 1993, "Take Our Daughters To Work Day" was popularized to support career exploration for girls, later expanded to Take Our Daughters and Sons to Work Day.

Female-only taxi companies in India, the UAE and Brazil support working women.

Some Facts About Women Entrepreneurs

Today, more women are breaking free from the traditional, gender-specific roles and venturing into the business world. Not only are they holding high corporate positions but they are also successful women entrepreneurs who own almost half of all businesses in the United States. The steady rise in female entrepreneurs can be due to many different reasons, most of which share the same rational as their male counterparts—passion for their ideas, the desire to become their own boss, and the need to address philanthropic causes. A recent study indicated that 1 out of every 11 adult women is an entrepreneur in the United States. Women business owners contribute to the overall employment of 18 million workers and generate anywhere from $2 to $3 trillion in U.S. economy revenues. Many of the important facts that follow will support these findings.

1. Demographic characteristics
Studies have shown that successful Women entrepreneurs start their businesses as a second or third profession. Many of them have experienced a considerable amount of dissatisfaction with their previous careers and in working for others. Often times, these innate desires to be their own boss are the driving forces that motivated them to pursue entrepreneurship.

As a business owner, these once unhappy individuals are now more satisfied and content with their personal and professional life. In addition, because of their previous careers, women entrepreneurs enter the business world later on in life, around 40-60 years old. Many of them have higher education degrees, a significant characteristic that many successful female entrepreneurs have in common. Women entrepreneurs also tend to offer better health care benefit packages, on the job training and education, more tuition reimbursement for students and continuing education employees, and provide more vacation and paid leave options to their staff.

2. International implications
From a large-scale perspective, female entrepreneurs encompass approximately 1/3 of allentrepreneurs worldwide. A recent international study found that women from low to middle income countries (such as Russia and the Philippines) were more likely to enter early stage entrepreneurship when compared to those of higher income countries (such as Belgium and Sweden). A significant factor that may play a role in this disparity can be contributed to the fact that women from low income countries often seek an additional means of income to support themselves and their families. As a result, many of them often resort to entrepreneurship in addition to their current jobs. However, women entrepreneurs from higher income countries were more successful at establishing their businesses and exuded more confidence than those of poorer nations, perhaps because of the availability of resources and financial backing from families and friends.

In addition, women who had higher education experience were more likely to transform their existing businesses into successful ones, proving that learning and work familiarity is universal across all cultures and greatly contributes to the overall success of any business venture.

3. Strategy
Recent studies also indicate that women entrepreneurs are assembling themselves into groups or confederacies. The reasons behind this trend have to do with the desire to establish solid women business networks, where members can collectively pool resources and expertise together.

Women business networks have also been found to be more generous in their philanthropic contributions. At least seven out of ten women entrepreneurs of a new business volunteer their time at least once per month to community-related causes. In addition, 31% of them contribute $5,000 or more to various charities annually.

Even though many female entrepreneurs have home-based and service-related businesses, they are unafraid of technology and have recently entered many industries that were once male-dominated, such as construction, design, manufacturing, and architecture. In addition, the retail industry still makes up the largest share of women-owned firms.

One of the advantages of working in a women-owned new business is that the workforce is more diverse. Women entrepreneurs are more likely to employ a staff that is more gender-balanced, comprising of 52% women and 48% men on average. On the other hand, most male-owned businesses have a workforce that is often more than 65% men.

4. Sources of capital
The fact that more women entrepreneurs have risen in the past few years has been made possible in part by the easy availability of business capital. Women entrepreneurs tend to fund their startups with different sources of funding, including “bootstrap” finances (personal money from savings and credit cards) and commercial loans. Today, not only are there more grants and bank loans made available to women entrepreneurs, but there are also more diversity programs that specialize in providing seed funding to female business owners.

However, despite the recent achievements, research shows that it still remains difficult for women of color to get access to seed funding. According to one recent study on women entrepreneurs, approximately 60% of Caucasian women business owners were able to obtain bank credit, compared to 50% of Hispanic, 45% of Asian, 42 % of Native American, and 38% of African-American women entrepreneurs.

5. Motivation
Much of a business woman’s drive to pursue entrepreneurship is due to the immense passion she has for her work. Many women entrepreneurs are not afraid of taking risks and are two times more likely to make above average risks than their male equivalent, making monetary gain a less likely factor in their business pursuits. Instead, they possess very strong business ideas and seek any and all means to share their business ideas with others who may benefit from their discoveries.

Another motivating factor behind women entrepreneurs is the desire for control. Many successful female business owners are provoked by the opportunity to be their own boss and run their own company, a prospect that would never occur if they had worked for someone else. Women entrepreneurs are also motivated by philanthropic commitment to society. Their new businesses will greatly stimulate economic development in their community and create new jobs for many people.

Another inspiring component that many successful women entrepreneurs share is the fact they have the tendency to balance family life and career. Many people may have had doubt in this ability when these women first entered the field because of the long work hours, but these reservations have often been proven wrong. It is no wonder that many successful womenentrepreneurs have an amazing ability to multitask, properly balancing both personal and professional life with their goal-oriented approach.

6. Present challenges
Even though female entrepreneurship and the formation of women business networks is steadily rising, there are still many prospective women entrepreneurs who do not follow through with their great business ideas. This is widely due to the fact that many challenges exist for them to overcome. First and foremost, many prospective women entrepreneurs may fear the debt associated with their startup. They may not have the resources available to make educated decisions about properly raising capital or may even have been discouraged by family and friends. As mentioned earlier, if an entrepreneur truly believes in their business ideas, then they will seek any means to move forward and commercialize their concepts.

A second challenge may be their lack of knowledge in information technology and business skills. Even though many successful business ventures are IT-related, there are many other thriving industries that do exist. Experience is always an advantage; however, one just has to conduct ample research on their industry, their consumer base and competitors, and speak to entrepreneurs who have already gone through the process. Entrepreneurship is a learning experience and even the most successful business owners have had to learn new things throughout the development of their company.

Another major challenge that many women entrepreneurs may face is the traditional gender-roles society may still have on women. Entrepreneurship is still a male-dominated field, and it may be difficult to surpass these conventional views. However, it is very important to be aware that despite the negativity that may exist, over 9 million women own their own businesses in the U.S. In fact, of all U.S. enterprises that exist, over 40% comprise of women-owned businesses. The United States Census Bureau predicts that by the year 2025, the percentage of women entrepreneurship will increase to over 55%. Many women feel a great deal of empowerment by the opportunity to own their own company and may now be motivated by such high statistics.

7. Future prospects
There are many promising predictions for women entrepreneurs in the near future. More coalitions will be formed among female associates, enabling the establishment of female business networks to flourish in the business world. In addition, the U.S. Census envisions that women entrepreneurs and female business networks will both remain dominant, comprising of over 50% of all business in the United States in the next several years. Many women entrepreneurs with home-based and service-related businesses will eventually shift to the information technology industry, making this once male-dominated commerce to be one of equal gender appeal.

With progressive changes, the United States economy will refine itself to a financial system that will rely heavily on the internet and e-commerce for their business practices. Enterprises will also focus more on women-related issues and principles.

Conclusion
Women entrepreneurs have become a strong driving force in today’s corporate world. Not only are they able to equalize their duties of both motherhood and entrepreneurship but they also comprise of almost half of all businesses owned today. Many women entrepreneurs have an average age of 40-60 years old because they have had previous careers in other areas. Their primary goal is not monetary reward but rather personal satisfaction and community involvement. Many of them are educated and assemble into groups in order to pool business ideas and resources together.

Women entrepreneurs also have more access to business capital and seed funding than ever before. Yet despite the many opportunities, many prospective women entrepreneurs are intimidated to move forward. Overall, there are many promising forthcoming predictions for women business owners. They will continue to form female business networks, transition towards information technology, and rely strongly on e-commerce as their form of trade.