Why will women become the next billion successful entrepreneurs?
You will find endless literature and useful tips on the key factors that make a business successful. Ask any expert for advice, and in return you will receive a list that includes the delivery of the product that meets the needs of the market, detailed tactics for tracking the market, a well-coordinated team, and much more.
But until recently, one factor of a successful business was kept in the strictest confidence ... and, most likely, this is not what you would suggest. These are women. And while men, as a rule, stand at the helm of a company, it becomes evident that women run enterprises, increasing business success. They attract the attention of high-class male leaders, large well-known corporations and even the government, which not only notices their leadership qualities, but also acts as their main defender.
The billionaire investor, Warren Buffet, is an ardent supporter of female leadership. He publicly announced that famed journalist / editor Carol Loomis and Katharine Graham, who had run The Washington Post for more than two decades, set a role model for him. He also advocated expanding business opportunities for women in his popular essay, which was published in Fortune magazine in 2013.
Kevin O'Leary, an investor in the SharkTank series of American reality shows, agrees that women are of great value when it comes to successful business management. In a recent article published on the Business Insider news portal, he said that of the 27 companies that he invests in, no company run by a man has outperformed organizations that run women. By the way, women occupy 55% of the CEO positions in his companies.
These results are consistent with studies that show that women entrepreneurs achieve superior results when compared to their male counterparts:
- Private IT companies run by women demonstrate greater capital efficiency and also bring in 35% more investment income. When they receive venture financing, they bring in 12% more profit than IT companies run by men (taken from the Kauffman Foundation report “Women and IT: Evolution that will save the world”).
- Venture capital firms that have more women in their senior management are more likely to achieve positive results than companies with only men in their leadership (taken from the Dow Jones VentureSource report “Women at the helm: do they, as managers, lead startups to success?”)
- Women-led venture capital firms that invest in enterprises outperform male-led ventures (SBA Office of Advocacy)
So why are there so few women entrepreneurs?
Studies show that inadequate funding can put women at a disadvantage when they try to start their own business and continue to fund its
2014 Report, called “Barriers to Women's Entrepreneurship in the 21st Century” (a study initiated by the US Senate Small Business Committee and Entrepreneurship), states:
- Small business loans to women account for only 16% of the total.
- Women receive only 7% of venture capital funds.
A report entitled “Access to the capital of high-growth enterprises owned by women” (the study was initiated by the International Women's Business Council in 2012) reports:
- As a rule, men start their business with a capital that is two times higher than the funds of women, ceteris paribus.
- Women receive only 2% of the total funding from external investment, compared with 18% for men.
- In 2008, as the head of the enterprise, a woman had a much greater chance of refusing to grant a loan than her male competitors.
Another obstacle to starting a business for many women is a lack of faith in themselves. Women often think that they will not be able to create their own business - this is usually why they do not try to take the first step.
According to the Global Entrepreneurship Monitor: 2012 Women's Report, almost two-thirds of men are confident that they can start a business, but among women, only less than half believe they are capable of this, despite the same level of education and experience.
This may be one of the reasons why women do not even consider the entrepreneur's path, choosing their career path. Every fifth man and only one out of 13 women plans to start their own business over the next five years.
Finally, a lack of support or a mentor can prevent women when it comes to starting their own business. According to a 2010 report entitled “Are successful women entrepreneurs different from men?” (Are Successful Women Entrepreneurs Different from Men?), Promotion and support are far more important for women than for men.
In fact, more than half of women (56%) and only 31% of men were motivated to start their own business thanks to the “personnel” efforts of the founder of another company. Similarly, the report noted that women, unlike men, attach greater importance to professional and business connections for the success of their startups. This is the reason that in the absence of sufficient support, they may abandon their intentions to start their own business.
According to The Global Entrepreneurship Monitor: 2010 Women's Report, women can be in a losing position compared to the male “competitors” when it comes to business relationships.
But these barriers are beginning to recede, as leading organizations offer their help.
More recently, Intel announced its intention to allocate $ 125 million to support women in business and other "entrepreneurial minorities." Dell and EY have also created support programs for women who own and manage their own business.
In addition to these private initiatives, the governments of the United States and Canada are also involved in supporting women entrepreneurs. The U.S. Small Business Administration announced in 2011 that it would provide funds for the development of small women-owned firms (WOSBs).
In March this year, the Government of Canada also announced that Canada's Business Development Bank will provide $ 700 million over three years to finance women-run companies.
While women entrepreneurs continue to face challenges, it cannot be denied that awareness of their success has increased, and public support has also strengthened. All these trends undoubtedly symbolize changes for the better. Women are ready to take advantage of new opportunities for business management and leave their mark on business development. In fact, this is already happening.
In recent years, women are increasingly starting their own business, and we hear more and more successful stories of “female entrepreneurship”.
Probably one of the most striking examples of a successful business woman is Lynda Wienman, co-founder of Lynda.com, which provides online training services. The company was acquired by LinkedIn for $ 1.5 billion in April this year. This sale was the fourth in the list of the most expensive deals in the history of social media!
So, the secret is revealed. Women will become the next billion entrepreneurs and change the face of business.