The State of The Women: Where Female Entrepreneurs Stand Today
BBG Ventures is one of the venture capital firms specifically reaching out to women entrepreneurs with millions in startup funding.
Celine Dion, Madonna, Mariah Carey, Janet Jackson and Toni Braxton ruled the pop charts while “Forrest Gump” and “The Lion King,” drove movie ticket sales. It was 1994 and also the year the U.S. government declared the goal of awarding 5 percent of all contracts to small businesses owned by women.
More than two decades later, that finally has come true, with $17.8 billion of federal contracts given to small women-owned businesses in 2015. And that was only after the government said a small percentage of contracts should be set aside for competition to only women-owned businesses.
According to Stacy Cowley writing in the New York Times, ‘”I think we can attribute the government meeting its goal directly to that being put in place,’ said Ann Sullivan, the head of government relations for Women Impacting Public Policy, a group that lobbied for the change. ‘They weren’t going to meet it simply by wishing and hoping; there needed to be a program specifically designating some contracts.’”
Female entrepreneurs may also be going after new business more aggressively, according to the 2016 BNP Paribas Global Entrepreneurs Report that surveyed 2,600 entrepreneurs in 18 countries.
Women business leaders may have higher expectations about their own businesses, according to Molly Petrilla, writing in Fortune. She continues: ‘“They are more ambitious and have been more successful than their male counterparts,’ Sofia Merlo, co-CEO of BNP Paribas Wealth Management, says of the women entrepreneurs surveyed.”
Ambition did certainly play a role for the 33 self-made women billionaires who made the Forbes 2016 list of billionaires. They hail from China, Hong Kong, Germany, Italy, Russia, the U.K, and of course, the U.S. These successful women entrepreneurs did not inherit, marry or partner with spouses on their wealth, like many of the 190 women billionaires. That shorter list includes Sara Blakely of Spanx, Doris Fisher of Gap and Meg Whitman of ebay.
For all women entrepreneurs, ambition alone may not help them get a bank loan, as a new study from Biz2Credit shows that loan approval rates for women starting businesses are 33 percent lower than the loan approval rates for men.
Some of the reasons are that revenues are 60 percent higher for businesses owned by men than women, at $229,115 per year. The average credit score for a woman business owner is 600, compared to 615 for a male business owner. Default rates are also double for women, at 1.25 percent in 2015, compared to loan default rates of .66 percent for men.
That problem is particularly acute for black women business owners, according to Black Enterprise. Carolyn M. Brown writes: “Limited access to private equity and debt financing remain persistent factors which inhibit both the creation and growth of businesses within minority communities and among women. ”
Venture capital firms that specifically reach out to women entrepreneurs have offered millions in startup funding. According to Pitchbook, five companies with a history of female friendly funding include BBG Ventures (that stands for #BuiltByGirls); Belle Capital USA, Female Founders Fund; Golden Seeds and Women’s Venture Capital Fund.
Spending $2 million to help women advance professionally and define business and leadership goals is Lisa Skeete Tatum, co-founder and CEO of Landit Inc. Lora Kolodny writes in the Wall Street Journal that the ”Landit platform will enable women to input information about their goals, work experience, preferences and skills then attain personalized job listings, a career playbook and access to premium professional coaching services from Mobius Executive Leadership or resume and CV revision services.”
Kolodny quotes Skeete-Tatum: “Women represent 51 percent of the workforce but are only in 19 percent of senior management roles. They, or we, aren’t progressing through the ranks of these organizations as we should be.”
Yes, progression may be slow in many fields and the gender pay gap pervasive in all fields, but the pay gap may hit women entrepreneurs in tech particularly hard. According to a new study, “The Truth About the Gender Pay Gap” from Payscale, many factors including job types, job levels, compensation equivalents, marriage and family plus unconscious bias come into play.
The uncomfortable truth is comparing all working men to all working women in the U.S. with median salaries, women fall short by 25.6 percent. The median pay for a male worker is $60,200 and for a woman, $44,800 per year.
Gina Belli writes in Payscale that there are fewer female entrepreneurs in the tech industry than in non-tech industries. And fewer women overall in tech with no level reaching parity. At the executive level, 20 percent in tech are women, compared to 36 percent women executives in the non-tech world. As for directors in tech, 32 percent are women, compared to 49 percent women at that level in non-tech fields. As for managers and supervisors, 28 percent in tech are women, compared to 48 percent in non-tech fields.
Rising to the top in her field with a positive attitude is Nicole Purcell, president of the CLIO Awards (that honors the best creative work in advertising across the globe) since 2010. In an interview with Laura Dunn Huffington Post, Purcell says, “In my twenties I had wonderful mentors who taught me what to do and what not to do in business, I learned so much by watching them. At this stage in my career, I’m still looking to mentors for help in attaining that next level, while at the same time acting as a mentor to students and my team. I want them to see the business world in a positive light, like I did.”
Purcell’s advice to women entrepreneurs and all women leaders in business is this: “You have to push for your own opportunities and not be afraid to ask for what you want.” She adds, “I would tell anyone to find something you fall in love with and be passionate about it, then showcase that ambition, speak up and share ideas and help shape what you want your future to be.”
About the Author
Michele Weldon is editorial director of Take The Lead, an award-winning author, journalist, emerita faculty in journalism at Northwestern University and a senior leader with The OpEd Project. @micheleweldon www.micheleweldon.com