Small businesses are the bread and butter of the US and how fast they are, or are not, growing is an indicator of the health of our economy. Since the recession, growth has been slower than pre-recession levels, but it is there nonetheless. One portion of the population that is largely responsible for this growth is women entrepreneurs. Women are opening business faster than ever before and are quickly outpacing the national average; and by “quickly” we mean 5 times as fast. Women of color are especially bucking this “slow growth” trend. Since 2007, there has been a 126% increase in minority women-owned businesses.
So why don’t you see more large, women-owned businesses? There are a few reasons. Women tend to start smaller businesses and employ fewer people than male-owned businesses. Often they are in industries that generate less revenue. We also know that there is a financing gap between the genders; women start their businesses with about half as much capital as their male peers, regardless of the type of business they open. In fact, the disparity worsens as the potential for profit increases, particularly in the tech industry.
What can you do?
There are many ways to support women entrepreneurs, and here are a few to get you started!
- Investors: If you have money you would like to invest in a business, seek out women-owned businesses. Investments can be as large as millions of dollars, if you’re a venture capitalist, or as small as donating $10 to a crowdfunding campaign.
- Women Entrepreneurs: Start today! There’s no better time to start your business than right now. Be confident and if you need financing be sure you seek it out. Connect2Capital can help you identify what type of financing may be best for you if you’re unsure.
- Everyone: Support women-owned businesses by shopping at them and utilizing their services. Inspire the entrepreneurs of tomorrow by encouraging young girls to think big and outside the box.
This women’s history month, shop local and thank your local woman-owned businesses. They’re doing a lot more than you may know.
Data from: The State of Women-Owned Businesses, 2016