Top Ten Womenabling Research Facts of 2014

Top TenWe’ve kept tabs on the facts and figures that have been published during the course of the year (as we do every year). Here are what we consider to be the top ten new research-based facts about women business owners and their enterprises of 2014. They fall into four general categories: money, mentoring, metrics and STEM (science, technology, engineering and math). Here they are, along with links to the original source material for your reference. Many happy returns of the season from Womenable!

Money

  1. International CurrencyClosing the credit cap for women-owned SMEs across the developing world as a whole could boost the growth in per capita income by over 110 basis points (1.1%) on average. ~ Goldman Sachs Global Market Institute. February 2014. Giving credit where it is due.

  2. In an analysis of over 25,000 projects on Kickstarter, launched by 22,000 entrepreneurs between 2009 and 2012 and supported by over 1.1 million investors, researchers found that this crowdfunding platform is more hospitable than many other forms of business financing for women. For example: 1) a significant share of Kickstarter investors (40%) are women; 2) these women are more likely than men (40% versus 23%) to invest in women-led projects; and 3) women-led projects are more successful than those launched by men. The fundraising success rate for women was 69.5%, compared to 61.4% for men. ~ Dan Maroum, Alicia Robb, Orly Sade. May 2014. Gender Dynamics in Crowdfunding (Kickstarter): Evidence on Entrepreneurs, Investors, Deals and Taste Based Discrimination.


  3. The amount of early-stage investment in companies with a woman on the executive team has tripled to 15 percent from 5 percent in the last 15 years. Despite this positive trend, 85 percent of all venture capital–funded businesses have no women on the executive team. This is the case despite the finding that businesses with a woman on the executive team are more likely to have higher valuations at both first and last funding (64 percent higher and 49 percent higher, respectively). ~ Candida G. Brush, Patricia G. Greene, Lakshmi Balachandra, Amy E. Davis. September 2014. Women Entrepreneurs 2014: Bridging the Gender Gap in Venture Capital.


  4. In 2013 women angels represented 19.4% of the angel market, similar to 2012 (21.8%). Women-owned ventures accounted for 23% of the entrepreneurs that were seeking angel capital and 19% of these women entrepreneurs received angel investment in 2013. ~ Jeffrey Sohl, Center for Venture Research. April 2014. The Angel Investor Market in 2013: A Return to Seed Investing.

Mentors

  1. Closeup of business people with hands on handsAn analysis of high-growth women entrepreneurs (those with sales or employment growth of 20%+ over the past three years) in Latin America and the Caribbean finds that growing up in an entrepreneurial family helps define their entrepreneurial spirit. Both high-growth men and women are more likely than average to seek mentors to guide their growth. However, while high-growth men entrepreneurs seek mentors from outside their family, women tend to receive guidance from within their own families. ~ EY, Multilateral Investment Fund of the Inter-American Development Bank. March 2014. WEGrow: Unlocking the Growth Potential of Women Entrepreneurs in Latin America and the Caribbean.

  2. A comparison of a survey of women in technology firms launched between 2002 and 2012 with a more general sampling of technology firms founded in 2004 (the Kauffman Firm Survey) finds that female and male entrepreneurs have a lot in common. They would seem to start their companies for similar reasons, cite similar self-perceived reasons for success, and face similar challenges. However, several differences stand out: 1) the women technology entrepreneurs surveyed don’t appear to have had inspiring role models as their principal motivation; 2) women entrepreneurs in general appear to respond differently than men do to failure, and cite lessons learned from failure as a big reason for success; and 3) there is a financing gap when it comes to high-tech and high-potential women entrepreneurs. That financing gap turns into a growth gap in terms of company outcomes. Finding ways to fill that financing gap could have a huge payoff in job creation and innovation. ~ Alicia Robb, Susan Coleman, Dane Stangler. November 2014. Sources of Economic Hope: Women’s Entrepreneurship.

Metrics

  1. measuring_tape copyIn an analysis of the conditions in which growth-oriented women’s entrepreneurship can prosper, the United States (with a score of 83), Australia (80) and Sweden (73) are the top ranking countries among 30 analyzed. They are followed by France and Germany (tied at 67), Chile (55), the United Kingdom (54) and Poland (51) which all received an overall score of 50 or more. ~ Ruta Aidis, The GEDI Institute. June 2014. The Gender Global Entrepreneurship and Development Index.

  2. As of 2012, just under one-third (29%) of the 40.6 million business owners in Europe are women, up from 26% in 2003. Over that nine-year period, the share of business owners who are female has risen most strongly in Lichtenstein (with a 16% increase in the share of entrepreneurs who are female), Iceland (+8%), and Cyprus (+8%), compared with the overall 3% increase. ~ European Commission. September 2014. Statistical Data on Women Entrepreneurs in Europe.


  3. On average over the past 17 years, there has been a net increase of 591 women-owned businesses in the United States each and every day. The number of net new women-owned firms has fallen in the wake of the recession – there was a net increase of 714 women-owned firms per day from 2002 to 2007, and a lesser 506 per day between 2007 and 2014 – but start-up activity is increasing. Just in the past year, there have been an estimated 1,288 net new women-owned firms launched each and every day. ~ American Express OPEN & Womenable. March 2014. The 2014 State of Women-Owned Businesses Report.

STEM

  1. womanlab copyWomen have increased their representation in STEM graduate enrollment, but that increase has been uneven across STEM fields. Women have achieved parity for PhDs in biological and medical sciences, but their enrollment continues to lag in some of the most entrepreneurial fields, such as bioengineering, mechanical, and civil engineering and materials science. Further, across all STEM fields, female PhDs have lower rates of entrepreneurship than their male colleagues (5% compared to 7%), and file fewer patents (15% vs. 28%). ~ Margaret E. Blume-Kohout for SBA Office of Advocacy. October 2014. Understanding the Gender Gap in STEM Fields Entrepreneurship.

  2. (A 2-for-1 listing: this report also appeared in our ‘mentors’ category) A comparison of a survey of women in technology firms launched between 2002 and 2012 with a more general sampling of technology firms founded in 2004 (the Kauffman Firm Survey) finds that female and male entrepreneurs have a lot in common. They would seem to start their companies for similar reasons, cite similar self-perceived reasons for success, and face similar challenges. However, several differences stand out: 1) the women technology entrepreneurs surveyed don’t appear to have had inspiring role models as their principal motivation; 2) women entrepreneurs in general appear to respond differently than men do to failure, and cite lessons learned from failure as a big reason for success; and 3) there is a financing gap when it comes to high-tech and high-potential women entrepreneurs. That financing gap turns into a growth gap in terms of company outcomes. Finding ways to fill that financing gap could have a huge payoff in job creation and innovation. ~ Alicia Robb, Susan Coleman, Dane Stangler. November 2014. Sources of Economic Hope: Women’s Entrepreneurship.

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Growing Women Entrepreneurs in LAC

At a recent event in their Washington DC headquarters, the Inter-American Development Bank’s Multilateral Investment Fund showcased the results of a new survey conducted among high-growth women entrepreneurs in Latin America and the Caribbean (LAC).
WEGrow-infographic
Undertaken in concert with Ernst & Young, the study, WEGRow: Unlocking the Growth Potential of Women Entrepreneurs in Latin America and the Caribbean, utilizes a blend of qualitative and quantitative methods, focuses on nine countries (Argentina, Brazil, Chile, Columbia, Costa Rica, Jamaica, Mexico, Peru, and Uruguay), and explores the issue of what makes high-growth women entrepreneurs tick. High-growth in this case means that the firms in question have grown by 20% or more for at least the past three years.

What did the study find? Among other things that:

Measuring the BEE for WOBs in LAC

Taking on those who might attribute gender gaps in business performance to differences in entrepreneurial drive, commitment or motivation, there is a growing body of analysis focused on how the business-enabling environment (BEE) affects the development of women-owned businesses (WOBs). We womenablers are well aware that a woman entrepreneur can be as committed and motivated as all get-out, but her enterprise will not grow as strongly as one owned by her male peers if (for example) she cannot own property in her own name – thereby depriving her of the collateral needed to fuel the growth of her business via access to capital.
WEVS_cover

Property ownership and capital access are among the 49 input variables in five key categories (security & stability, business climate, finance, capacity and social services) that are codified and analyzed in a new regional assessment of women’s entrepreneurship in Latin America and the Caribbean (LAC). The WEVentureScope, from the Inter-American Development Bank’s Multilateral Investment Fund (MIF), was announced in a launch event last week. Featuring speakers from the MIF, the Economist Intelligence Unit, which conducted the analysis (and which brought us the Women’s Economic Opportunity Index), and a panel of experts, the event announced the availability of a summary report as well as a marvelously interactive web site (www.weventurescope.com) which allows users to change the weighting of different factors and see how it affects a country’s overall score.

At present, the WEVentureScope analyzes and ranks 20 countries in the region – ensuring coverage across the region but focusing on countries with a higher level of data availability. In this inaugural effort, these five countries lead the list:

  • Chile (scoring 64.8 out of a possible 100):
  • Peru (62.4);
  • Columbia (61.8);
  • Mexico (60.2): and
  • Uruguay (60.0).

During the announcement event (which you can watch at your leisure by clicking on the link to the archived event below – the event starts at 1:45:00 and runs just under 2 hours), the point was made that, even among these top-ranked countries, there is much room for improvement, given that the top score is just two-thirds of the way to a perfect score of 100. Speakers also mentioned the challenge of comparative data, and the hope that a report such as this will spur more governments to start keeping the sort of sex-disaggregated data and statistics that could add new countries to this effort in future years.

Women’s Entrepreneurial VentureScope Launch Event

Visit the web site to learn more, read the news release, download the report, and play with the weighting of different environmental factors.

This effort is an important step forward in understanding the barriers to entry and growth of women-owned firms in the region, and to informing policy and programmatic action to support their improved success. ¡Viva las mujeres empresarias!