A lot of discussions are taking place on women’s entrepreneurship, gender inequity at the workplace, bias against working women, and the work-life balance of women. However, there is hardly any data that shows the complete picture of women in business and the challenges they face today.
While it cannot be denied that in the past decade women have started establishing businesses and have even become successful, some of their struggles as entrepreneurs remain. Irrespective of the change in time that has encouraged over 252 million women to become entrepreneurs globally, they are still struggling to overcome the challenges that they often confront. Several studies on women’s entrepreneurship reveal that the main concerns of women in business today include the Covid-19 pandemic, children and career, work-life balance, lack of capital, lack of support, social expectations, and so on.
Impact of pandemic
According to a report published by McKinsey & Company, women have been disproportionately affected by the Covid-19 crisis. In fact, the pandemic has heightened the large and small inequalities for women – both at work and at home. Before the pandemic, women had been making some progress in the workplace. At the beginning of 2020, women’s representation in corporate America was trending – albeit slowly – in the right direction. Between January 2015 and December 2019, the number of women in senior positions increased from 23% to 28%, and in the C-suite from 17% to 21%. The vast majority of the women (83.8%) reported that the pandemic had a negative impact on their business, while nearly four in ten reported that their business will or may have to close as a result. This is devastating news not only for emerging markets but represents a very real threat for women entrepreneurs who depend on the income generated by their businesses.
About 35% of women entrepreneurs say that they face gender bias. This is notwithstanding the strides that have been made towards workplace equality in recent years. As a result, women in business are still largely under-represented. Statistics show that men are significantly more likely to become entrepreneurs than women. A UK-wide study in 2020 showed that 32.37% of businesses founders are female. While this is encouraging growth, men are still twice as likely to start their own businesses.
A survey by Associated Press showed that gender bias can be subtle, such as failing to make eye contact with a woman business owner but engaging in animated conversation with her male co-owner. It may also be more blatant, like asking an owner who’s seeking investor money if she plans to have children. According to many women business owners, they’ve encountered gender discrimination from potential investors, customers, and employees who don’t grasp the reality that a woman can be a CEO, or own a technology company.
Lack of capital
Unfortunately, even after women have proved themselves that they are more than capable, people find it hard to believe and hesitate to invest in a business venture which is established by women entrepreneurs. It is also disappointing to see that banks do not consider women as credit-worthy as they believe that they can give-up their business at any time. Therefore, women entrepreneurs do not have any alternative other than to rely on their savings, or maybe take the financial help of their family.
The National Women’s Business Council states that compared to men, women business owners raise smaller amounts of capital to finance their firms and are more reliant on personal, rather than external, sources of financing. It also found initial disparities in the levels of startup capital in women-owned businesses as compared with men-owned businesses do not disappear in the years following startup. A key difference between men and women regarding bootstrapping is that “women choose bootstrapping instead of overdrafts and men choose bootstrap finance to supplement overdrafts,” the NWBC notes.
Our society perceives women as stereotypes; like the ones who should stay at home and put all their attention on their family. Often society looks down upon women when they venture out and establish a career for themselves. According to a study published by Emerald Insight, a large number of women are not just entrepreneurs or career people – they have families, spouses, and other responsibilities. Demands from personal and professional commitments can pressure a woman to abandon either her business or family. The family expects her to be a mother and wife, while the business requires her to be the leader and show commitment. It becomes more difficult for those who lack social support because they have to carry the entire burden by themselves. This is the reason why women often take more time than their male counterparts to gain trust and recognition from the public.
Lack of support
Lack of mentors and advisors is another major setback for women entrepreneurs. Data reveals that 48% of women in business lack competent advisors to guide them through entrepreneurship. In addition, establishing a startup comes with many challenges, meaning even the most experienced entrepreneurs need mentorship to come up with new ideas and implement the right business strategies. In a world where high-level business is dominated by men, it becomes difficult for women to excel in their profession without someone showing them the right way.
However, there is no doubt that women have made an enormous effort to be present in the world of entrepreneurship. Their impact is remarkable, and there is a likelihood that it will only grow. Women have shown that they can have a higher company success rate, but they tend to take fewer risks. Companies that are owned and led by women proved to be a safer option for investors, yet they still struggle to obtain the capital they need. This is likely to change in the upcoming years, as female presence in the world of business becomes the norm.
Leave a Reply