For many women, starting a business is often a dream which does not become a reality. In spite of being actively involved in the labour force, the entrepreneurial domain is mainly comprised of men. So, where are our women entrepreneurs and shouldn’t there more women taking up this alternate career option?
Women are outside those much-needed networks
Third Way, a think tank revealed that only 36% of American women are entrepreneurs and they usually don’t employ anyone other than themselves and also gain a lesser revenue as compared to their male counterparts. Meanwhile, in the sphere of technology, only 10% of startups are owned by women according to a Harvard research paper. Some reasons for these are that people tend to give money to others like themselves, and those who start businesses carry out what others like themselves do. Business professor at the University of Hartford and co-author of the Third Way report, Susan Coleman said, “Women are just outside of those established networks, and if you’re outside the networks, you don’t get the knowledge, you don’t get the opportunities, you don’t get the contacts and you don’t get the funding.” Research also shows that women are less likely to think about entrepreneurship if there are less female role models to look up to.
Women are averse to taking risks
Economist and provost of Barnard College, Linda Bell said, “Whether, by cause or effect, the presence of a top woman executive has a really robust impact.” She also adds that women are excluded from financial networks since most of these are comprised of men and the referrals go to mostly men. Coleman again said, “Launching an entrepreneurial venture is a lonely and sometimes scary undertaking, and you need to have people to talk to.” Similarly, in the realm of incubators, only 6% of women-owned firms were started there. On the other hand, some studies show that women have a tendency to be more risk-averse than men, which actually make them better equity investors as compared to men, but this means that they are very wary of entrepreneurship. The problem does not lie in the lack of qualified professional women, but rather the industry itself.
Many people exist in a professional bubble, leaving behind those who dream to start their own business and this often has a negative effect on women entrepreneurs. It’s time for a change.