The narrative is the same globally. There are fewer women entrepreneurs than men. However, women are more successful than men while self-employed or starting businesses. In honour of International Women’s Day, we thought we would pass along the research findings and help the whole community achieve greater success.
A statement in the above paragraph requires qualification. Fortune magazine reports, “Companies helmed by women entrepreneurs had 13% higher revenues than those run by men, and finished 9% above the average for all entrepreneurs surveyed”. Fortune magazine went further and even broke the statistics down for women by generation, “Millennial women also reported even higher revenues than their already-above-average gender group for the coming year: for women, revenues were 9% above the overall average, and for women ‘millennipreneurs,’ it was 22%”.
The Big Question
This really does beg the question, why. What are the secrets to women and entrepreneurial success? There has been a lot of research performed on this topic. Virgin reported on a 2015 study by the University of Cambridge and Barclays and distills this reason from the available research, “where male entrepreneurs are likely to take risks to grow their business quickly and then find an exit route, women tend to aim for controlled growth and avoid gambling”.
Forbes magazine lists five reasons why women are more successful than their male counterparts with respect to entrepreneurial pursuits. Their list, derived from the Center of Entrepreneurship’s 2015 report, includes: “Women are better calculated risk takers, women are less prone to over confidence, women are more ambitious, women are more likely to take a long-term view, and women succeed despite facing more barriers than their male counterparts”.
The Forbes article reports women succeed in the face of multiple barriers. Earlier this year they stated women generally start businesses with significantly less capital than men. On average women’s starting capital is around $75,000 USD compared to men at $135,000 USD.
Forbes also reports women do not think they have the networks in place to support their business growth. Women entrepreneurs and small business owners make up 30-35% on the entrepreneurial community globally. While there are dedicated networks for women small business owners, founders, and investors the fact of the matter is the community is very small and spread out over vast areas.
In the same article, Forbes reports women think they lack the technical expertise to successfully run and grow their businesses. In large part this is related to the gender imbalance in the STEM fields and in the traditional business sectors, like finance and accounting. These perceived lacks force women to work harder for success.
How do we push past these barriers? It is in the list above. Taking calculated risks, not being over-confident, and being very ambitious. Additionally, women have long term goals and strategies in mind. Forbes reports, “the research suggests women are more likely to reinvest business profit in order to generate steady and profitable growth, while men are more likely to look for faster growth, possibly fuelled by equity investment, and a quicker exit”.
These personality traits paired steady, long-term growth strategies means “female entrepreneurs in the Centre for Entrepreneurship study take home twice as much pay as the men,” according to Forbes.
Our advice, there are several successful women in the Impact Hub Vienna community. Here is a quick list we published last year. Spend International Women’s day asking a successful woman for business advice. Or read a book from this helpful list we published written by and about successful women business owners.