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Where Are All the Women Entrepreneurs?

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Building a business is never easy, but do women entrepreneurs have an extra hurdle to overcome?

 

By now, nearly everyone with a pulse knows the names Richard Branson, Steve Jobs, Mark Zuckerberg, Larry Page, Sergey Brin and Bill Gates. They’re not just entrepreneurs, they’re rock stars. They started their startups from the ground up, and out of their sandcastle dreams they managed to build an empire or two. But what about their female counterparts? Where are all the female rock stars?

Actually, they’re everywhere.

From Silicon Valley to Sydney; from Bahrain to Brazil; from Manchester to Mumbai and everywhere in between, women entrepreneurs have been starting and building multi-million dollar companies and doing so at a faster rate than men over the past decade. Currently, there are more than 8.6 million women-owned businesses in the United States alone, generating over $1.3 trillion in revenue. So why does the public know so little about them? And why, in spite of this rapid growth, are there still so many more male-run than female-run startups?

Women Entrepreneurs as part startup of eco-system

The answers are complex, so I turned to someone in a great position to help me understand. Andrea Guendelman is a cross-border financing lawyer based in Boulder, Colorado. But more importantly, she’s connected to thousands of women entrepreneurs from all over the world. Just a year ago, she co-created and produced Common Pitch Chile, the biggest innovation and entrepreneurship event ever held in South America. Andrea GuendelmanIt attracted 10,000 participants and featured Al Gore as keynote speaker. This year she co-produced Boulder, Co.-based Startup Phenomenon Women with her partner Carrie Van Heyst, the first in a series of networking events designed to inform, encourage and inspire entrepreneur women. Over 600 high powered entrepreneurs attended.


Women are not going into computer sciences

Andrea says one of the reasons there are so few female tech entrepreneurs is that “women are not going into the sciences and math – the tech world.” Of the 120,000 computer-science graduates in the U.S. each year, only 11 per cent are women – and the numbers are declining. Another reason for the dearth of female tech entrepreneurs is limited access to capital. Most venture capitalists want to invest in high growth startups – companies that can quickly scale. But women tend to be underrepresented in those kinds of companies.

Women Entrepreneurs as % of CS Grads

Andrea also points out that women’s “selling skills need improving.” In her experience, women entrepreneurs tend to lack the confidence and “bravado” that male entrepreneurs have (some might call it chutzpah), and that can hurt them when it comes to attracting funding. They also tend to be perfectionists and sometimes need to get all their ducks in a row before plunging ahead with the business. But businesses are never perfect, and neither is timing.

Women entrepreneurs have exceptional networking and leadership skills

That said, women entrepreneurs have tremendous untapped strengths in other areas. For example, Andrea notes that women are exceptionally good at building effective ecosystems and nurturing communities. In fact, women tend to have more advanced networking, leadership and nurturing skills – three of the reasons why Andrea continues to champion their cause so passionately.

To broaden my perspective, Andrea suggested I talk to some of the women in her business network. One of the first women I talked to was Fran Maier, the dynamic cofounder of Match.com, the world’s first online dating service. Fran left Match.com in 1998 and went on to join TRUSTe (pronounced “trustee”), transforming it from a non-profit to a very successful for-profit, venture-backed company. TRUSTe has become one of the world’s leading Data Privacy Management companies, and Fran now serves as its board Chair. Fran is not only a successful serial entrepreneur, she’s currently mentoring half a dozen female startups (and some male startups as well).

Women dominate social media

“Networking used to be a male preserve,” says Fran, “but the Internet has changed everything. Women already dominate many of the big social media networks such as Twitter and Facebook, and they’re taking advantage of the ‘social web’ to build their business networks”. On the down side, she notes that the Venture Capital world is predominantly male, and men tend to relate better to male entrepreneurs. When women present their business case, VCs often say “I don’t get it.” They’ve even been known to “not get it” when the business has customers and revenue and is cash flow positive!

Only 8 per cent of venture backed companies are women-owned. Only 11 per cent of venture capital partners are female. Only 15 per cent of angel investors are female. And only 9 per cent of board members are female, which is even lower than the already low percentage of women on public boards (16 per cent).

Women Entrepreneurs in Startup Eco-System

Fran certainly doesn’t feel all the blame for these numbers can be laid at the feet of outsiders. Some of the barriers are self-inflicted. For example, women entrepreneurs tend not to be as aggressive and persistent as they could be, and they are hesitant to jump in and “make the deal” the way men often do. Fran also agrees with Andrea that there simply aren’t enough women going into the sciences – specifically engineering. Unfortunately, the lack of women software “geeks” tends to reinforce a stereotype in the minds of many funders who unconsciously favour the unshaven young male techno-nerd in a hoodie over the well-dressed female with a credible plan and the motivation to carry it out.

Fran’s message: target women and the products they buy

Yet, some of the world’s greatest entrepreneurs have come from sales and marketing, so there’s no need for women to be discouraged if they don’t have techie credentials. Fran’s key message to women entrepreneurs is this: target women’s products and the women who buy them “because they’re just like you. It’s a huge market – women represent nearly three quarters of all purchasing power.” At the same time, women consumers often feel misunderstood by the merchants they buy from. This is the classic “unmet need” that so many marketing case studies showcase. As Fran said in a recent keynote address she gave at a Women 2.0 conference: “The women you’re targeting are very much YOU. Go out and get her!”

As a result of my talks with Andrea and Fran, three big questions remain:

  • One: Do women think “big” enough?
  • Two: Where are the female VCs?
  • Three: What concrete steps can women entrepreneurs take to get on an even footing with men?

 

Let us know your thoughts in the comment section below, and stay tuned for Part 2 because fast-rising entrepreneurs Sara Sutton Fell (FlexJobs.com), Kelly Hoey (Women Innovate Mobile) and Meena Mansharamani (GoGo squeeZ, Pup to Go) will provide some intriguing answers.

For part 2 of this post, “An Action Plan for Women Entrepreneurs”, please click here.

 

 

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About Jonathan Verney

I’m Jonathan Verney. I’m a lucky man because I get to write for a living, but also because I have the opportunity to work with Drew to help entrepreneurs grow their businesses.

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  • Carol Chandler

    Enjoyed your article. Anyone starting their own business has challenges to overcome. The best advice I have is to surround yourself with people who will support, mentor, educate, and challenge you. You will have good days and not so good days but don’t give up. As I have seen within my own business, if you don’t step out of your comfort zone you will never grow your wings and fly.

    • http://www.feedthebeast.biz/blog Drew Williams

      Thanks Carol!

  • Wolfgang Franke

    Enjoyed reading your comments and how you backed up your points with facts, not opinions.

    I agree that women are generally at a disadvantage and I have my own case study to back this up.

    I have been working with a women’s clothing shop here in Toronto and I have suggested to them that with their current offerings they are perfectly positioned to target a segment of the market that is generally ignored even though it is the most lucrative market niche. And what is the niche? Women over 50. These women have everything that should make a marketer excited — buying power and a largely unsatisfied desire to find clothing that makes them look beautiful (as opposed to finding endless fashions designed for skinny “twenty somethings”). Plus this store offers expert advice on how find the right (most flattering) item for a client. In other words, they are everything the mall is not. Yet my client is fearful of opening courting the +50 market, fearing that they will lose customers if they promote that they have fashions for women over 50. Almost all of their customers are either close to 50 or over 50, yet the owners lack the confidence to go against the (male imposed) idea that a women’s clothing store has to look as if it is catering to twenty somethings. The great irony is that the twenty somethings have no money — and the only time you see a twenty something in this store is when they are with their fifty something mother.

    • http://www.feedthebeast.biz/blog Drew Williams

      Could your client be persuaded to do a test? Maybe use direct mail or email to keep it under the radar. You could even make the test a survey to get feedback/input from 50+ women. If you can prove the demand on a test basis, it might make a case for a more focused effort by the retailer.

  • Pingback: An Action Plan for Women Entrepreneurs (Part 2) - Feed The Beast

  • Irene Katzela

    Can women in Technology Think Big? Absolutely. Not only they can think big, there are much more capable to see their ideas to successful fruition.
    It is true that women in technology are much more conservative in qualify their idea as the next big thing. But when they do, their ideas are, in fact, the next big thing. Thinking twice is not a liability but rather an asset, because once the dust settles, and it always done, the ones that remain standing are the ones that have substance.

    As women in Technology we face the burden of stereotypes and misconceptions. We cannot change them overnight or ask for any policy makers or programs to change them for us. It is our responsibility to achieve the best we can under the given circumstances and introduce change by example.
    My advice, find something you are passionate about, set your goals and put a course of execution forward. Stop listening of what you could, should, would have done. And success will follow.

    • http://www.feedthebeast.biz/blog Drew Williams

      Well put Irene. On the matter of just doing it, there’s a great post @TNW on not worrying about the $1 billion dollar idea… just start with a $1,000 idea and build from there… http://tnw.co/17e3ANW

  • VeryBerryRosie

    Well, we here in Canada don’t make up 50% of the population unless there’s an exact equal ratio, right, but that stat gives me the opportunity to demonstrate that I’m a savvy chick. Being savvy makes me self-serving sometimes and that’s good when it comes to ambitions. Not so good for my personal life. I’ve attended enough sorority building experiences to say that I need that support. Freelancing and previously owning a small business isn’t easy; I’m envious of the women in the article above.

    • http://www.feedthebeast.biz/blog Drew Williams

      Hi Rosie… I’m curious… do the stories of successful women help to inspire you at all, or do they make you think that it’d be tough to achieve their kind of success? So… are these kinds of stories helpful or not, in your view?

  • Shreela

    Women make up 50% of the population and create 100% of the population. The more women appear at the table, the more perceptions, policies, and decisions will change because women bring twice as much information to previously male dominated arenas.

    • http://www.feedthebeast.biz/blog Drew Williams

      Shreela, what are your thoughts on getting that done? Is it something women have to do for themselves, or are there policy issues that need to be addressed too?