03 Dec Women entrepreneurs important to state's economy
Madison, Wis. – Entrepreneurial growth, especially among women, is critical to economic development in communities throughout the U.S. and the world, and Wisconsin is no exception. Our leaders must continue to remove obstacles and support the growth of our women entrepreneurs.
The economic importance of women entrepreneurs and business owners nationwide is supported by impressive statistics. Between 1977 and 2002, the number of women-owned businesses in the United States increased 824 percent, with 6.2 million women-owned firms in 2002, according to a recent report by the Center for Women’s Business Research.
Today, the Center projects that 10.1 million U.S. firms are 50 percent or more owned by women, providing 13 million jobs and generating nearly $2 trillion in sales. Those firms represent 40 percent of all privately held firms.
Higher capital hurdles
Though women today face fewer barriers, inequities still exist, negatively impacting the growth of women-led and owned initiatives.
“We realize anyone trying to grow a business is going to face challenges and hurdles… but the hurdles are higher for women,” said Candida G. Brush, an associate professor of strategy and policy and director of the Council for Women’s Entrepreneurship and Leadership at Boston University’s school of management.
In Wisconsin, as in other states, promoting women as business owners should be a cornerstone of our economic development strategy. The number of Wisconsin women starting businesses and their success creating wealth and generating new jobs exceeds the national average. Yet, women entrepreneurs face two critical hurdles: raising capital, especially if the venture requires heavy capital investment; and balancing work with family.
Raising capital is a difficult prospect for both men and women. Women are less likely than men to have had prior entrepreneurial experience or significant corporate managerial experience and are hence less likely to participate in networks with high net worth individuals (what Verheul & Thurik  refer to as the indirect effects underlying gender-based differential access to capital).
These factors, rather than gender, also underlie the observed difference in the propensity of men and women to be active angel investors. If women do establish such contacts, they often need to build a stronger case for their capabilities and commitment than their male counterparts, often without the benefit of established relationships.
We need to give women entrepreneurs the recognition they deserve and create fair access to capital without doubting their capabilities or commitment to their venture.
Every 11 seconds, a woman leaves corporate America to start her own business, reports the National Foundation for Women Business Owners. This can be the result of another major issue for women entrepreneurs – the formidable task of balancing career, family, and personal lives. This issue often prevents women entrepreneurs and other professional women from advancing to their full potential.
Fortunately, many companies today recognize that balancing family matters, including raising children, is not just a women’s issue. Overall, the job market is changing, and more women and men are openly expressing the importance of balancing work and family life. As a result, organizations are discovering that to maintain top talent, they must be family-friendly. These changing trends help to establish supportive structures, making it easier for women entrepreneurs’ to balance work and family responsibilities.
On another positive note, there are more opportunities available to women than ever before. Women with leadership, management and marketing skills are in high demand. The economic conditions our country currently faces will demand that both women and men play a critical role in rebuilding the lost wealth in our communities.
By encouraging high-potential women entrepreneurs and removing obstacles to the growth of their endeavors, we lay the groundwork for our communities and our state to succeed.
This article previously appeared in MidwestBusiness.com, and was reprinted with its permission. The article is not meant to be a stock recommendation.
The opinions expressed herein or statements made in the above column are solely those of the author, and do not necessarily reflect the views of Wisconsin Technology Network, LLC. WTN accepts no legal liability or responsibility for any claims made or opinions expressed herein.