The world has seen a significant increase in women entrepreneurs globally in recent years. Women entrepreneurs have promoted economic development, created jobs, and driven positive social changes. Their rise is recognized as a powerful force for positive change, inspiring future generations and contributing to business and economic growth. However, despite their contributions, women entrepreneurs face gender-based challenges that restrict their opportunities to start and grow businesses.
Understanding the factors influencing women’s entrepreneurship is crucial to creating an inclusive environment that empowers them in the startup ecosystem. Women entrepreneurs play a vital role in economic development, job creation, and social inclusion. However, the gender gap in entrepreneurship, especially in developed countries, calls for efforts to promote gender equality and harness the full potential of women entrepreneurs for sustainable development.
Recognizing the Potential of Women Entrepreneurs: Governments worldwide recognize the potential of empowering women entrepreneurs as a catalyst for positive change. The commitment to empowering women entrepreneurs comes from realizing their potential as change-makers who significantly contribute to society and the economy.
Factors influencing women’s entrepreneurship: Gender-Based Challenges: Despite the remarkable achievements of women entrepreneurs, they continue to face persistent gender-based challenges that create disparities in opportunities to start and grow businesses. One notable issue is the gender gap in entrepreneurial careers, which remains more pronounced in developed countries. Factors such as limited access to resources, property rights, and institutional support can hinder women’s access to entrepreneurial opportunities.
Societal expectations: Defying social expectations empowers women in business by challenging stereotypes and breaking barriers for gender equality. It promotes authenticity and diverse leadership and inspires others to pursue their entrepreneurial dreams. However, societal expectations and gender stereotypes can hinder women’s entrepreneurial decisions due to limited support, fear of failure, and low self-efficacy. Despite challenges, progress benefits both women and society.
Balancing Family and Work: The responsibility of managing family and work often falls disproportionately on women, acting as both a barrier and a motivator for entrepreneurship. Some women may see entrepreneurship as a means to achieve a better work-family balance, while others may struggle with effectively managing both spheres. Moreover, the perception of entrepreneurship as a male-dominated domain can perpetuate stereotypes and discourage women from pursuing entrepreneurial careers.
Work-life balance: Work-life balance is especially relevant for women entrepreneurs who face unique challenges in juggling their professional and personal responsibilities. Women entrepreneurs often have to deal with additional factors, such as societal expectations, gender norms, and family obligations, that can impact their work-life balance. Despite these challenges, achieving a good work-life balance is essential for the success and well-being of women entrepreneurs.
Struggle for funding or financial access: Women in developing economies have limited access to bank accounts (over 1 billion worldwide) and encounter property ownership restrictions (40% of countries), which hampers their access to business loans. They often depend on personal savings and spousal funds. Venture capital financing is more challenging for women, with all-male teams securing 93% of funding in Europe, while women-owned businesses receive less. In the US, female-only entrepreneurs also get less financing than mixed teams. The gender disparity in venture capital funding may be due to fewer women involved, and female-only teams secure only 6% of funding, raising concerns about gender bias. Promoting female representation in entrepreneurship can contribute to gender equality and economic growth, aligned with UN SDG 5 (Gender Equality).
Discrimination and harassment: Women entrepreneurs in many countries face discrimination and harassment, both externally and internally. Biases and stereotypes hinder their progress, while harassment from authorities and male-dominated industries adds to their struggles. Boosting support systems, promoting diversity, and raising awareness can empower women entrepreneurs and lead to their significant contributions to the economy.
Market and industry biases: In some sectors, there may be biases against products or services targeted at women or perceived as “feminine,” limiting the market potential for women-led businesses. Gender norms undervalue their offerings, leading to less funding and growth opportunities. Challenging these biases and supporting women-led businesses is crucial to promote diversity and equity.
In order to overcome the challenges faced by women entrepreneurs, several key measures needs to be implemented:
Promoting Gender Equality in Entrepreneurship: Promoting gender equality in the entrepreneurial sphere is essential for sustainable development. Women’s underrepresentation in startups and leadership positions highlights the need for concerted efforts to address gender-related discrimination. Policymakers and academics recognize the economic benefits of gender equality and its positive impact on economies and societies. Encouraging and supporting women in entrepreneurship drives economic growth and fosters social inclusion and empowerment.
Networking and mentorship opportunities: Women entrepreneurs in many countries face bias and limited support from business networks dominated by men. Initiatives to help them, such as the Women Entrepreneurship Platform, have had little impact. Gender roles and lack of confidence further inhibit their progress. More support and a change in societal attitudes are needed to empower women entrepreneurs.
Access to Finance: Facilitating access to funding and capital is vital. This can be achieved through initiatives like women-focused venture funds, grants, and loans. The G20 has a role in promoting financial inclusion for women-owned SMEs and should implement the G20 Action Plan on SME Financing. Recommendations include recognizing the profitability of women-owned SMEs, incentivizing banks to serve this market, and collecting gender-disaggregated data. Governments should encourage banks to lend to women entrepreneurs through incentives and monitoring of gender-disaggregated data.
Balance family and work: To balance family and work, women entrepreneurs can set clear boundaries, prioritize tasks efficiently, delegate and outsource, communicate openly with family, use technology wisely, build a supportive network, schedule quality family time, be flexible and adaptable, practice self-care, and celebrate achievements. Finding the proper harmony between family and business responsibilities is a personal journey, and these strategies can help women entrepreneurs navigate the challenges and achieve a fulfilling and balanced life.
Work-Life Balance: Support women entrepreneurs with flexible work policies, remote work options, and mentorship for guidance. Prioritize their well-being through self-care practices like exercise and meditation. Encourage work-life integration involving family and empower their decision-making aligned with their values. Achieving work-life balance is crucial for women entrepreneurs to thrive personally and professionally.
Encouraging collaborations among women-led businesses is vital for collective growth and accessing broader market opportunities. Partnering with stakeholders at national and international levels supports the success of women’s entrepreneurship, creating a solid network of advocates. The “Women for Startups” program empowers women entrepreneurs through workshops, networking, and mentorship from industry leaders, enhancing their success in the entrepreneurial world. Success stories highlight the transformative impact of women’s entrepreneurship and collaboration in driving economic and social progress.
Implementing these measures creates a supportive and inclusive environment for women entrepreneurs, enhancing their success in the business world.