The report examines the potential of women in entrepreneurship to boost the U.S. economy. In particular, the report points out how “…given the slowing rates of business creation, the long-term pessimism about growth in the United States, and the rising share of women among educated workers, it seems clear that the future of American entrepreneurship and growth is in the hands of women” (p.3). The report included results from a survey “of women who were founding CEOs, presidents, chief technology officers, or leading technologists of tech startups founded between 2002 and 2012” to identify the main challenges for women-owned firms (p.4).
(Abstractor: Author and Website Staff)
Major Findings & Recommendations
The report highlights three primary challenges: • “Lack of mentors. Surprisingly few women in the survey cited a role model as their motivation for starting a business—and lack of available advisors is cited as one of their top challenges. More access to mentors is an important strategy for encouraging women to start and run successful high-growth companies. • “Their view of success and failure. Women entrepreneurs rank lessons from failures higher on their list of factors contributing to success than lessons from successes” (p.4). • “A financing gap. A high fraction of these survey respondents cited financial capital as a critical challenge to launching their firms (72.1 percent), and the majority (nearly 80 percent) used personal savings as their top funding source. This was surprising, given that about 31 percent of these respondents used angel investors and 14 percent had venture capital financing, much higher levels than businesses more generally and even high-tech firms, specifically” (p.4-5). The report offers the following recommendations for government and other organizations “to capitalize on the growth opportunity that exists with women entrepreneurs” (p.12): • “First, building the financial capabilities of women and ensuring access to bank financing and equity financing by venture capitalists and angel investors is paramount to having more high-growth entrepreneurship by women. • “Second, encouraging greater participation by women on the financing and investing side also might be an avenue worth pursuing. • “Other steps also can be taken to support high-growth women’s entrepreneurship in ways that will allow us to tap this greatly underutilized resource. This issue needs to be addressed on multiple fronts: 1) by offering more opportunities in industry that will give women the experience needed to pursue entrepreneurship, 2) by providing more opportunities to learn about starting and growing businesses, and 3) through exposure to successful female entrepreneurs who can share stories and insights from their successes (and challenges)” (p.13). Abstractor: Author and Website Staff )