Women make up half the world. Yet, fewer women own businesses compared to their male counterparts. Furthermore, businesses owned by women often have less access to funding and are perceived as riskier to invest in—although the evidence proves otherwise. This article elaborates on the advantages of having women in business and how it is essential in alleviating poverty and developing equitable communities.
Women can be more successful
Women have a more nuanced view of entrepreneurship than men. According to a report by the Centre of Entrepreneurship, they are generally more ambitious than men as well. The research found that 69% of women in C-suite jobs hoped to start their own business within three years, compared to only 29% of men at the same level.
Almost half of the women who already had their own business planned to start another business in three years. In contrast, only 18% of men who had their own business felt the same. Compared to men, more women considered themselves financial risk takers and more women felt that they were likely to see opportunities instead of risk.
However, while women are more open than men to embracing risk in entrepreneurship, they are also more careful with how they go about it. Women consider sustainability more often and are likely to inject business profits back into the business to achieve stability and gradual growth. Meanwhile, men are more likely to seek higher returns and quicker exits.
Women can be better leaders
Talented and skilled employees have the benefit of choice when it comes to choosing who they work for. To attract modern talent, businesses need to keep up with progressive values. In a society that is moving swiftly toward equity and inclusivity, having a woman leader or entrepreneur can help to redefine and realign work culture.
Thanks to traditional societal roles, women generally have more practice demonstrating empathy, compassion, and understanding. They are also more ready to take command in situations where leadership is needed. This can lead to a more cooperative and communicative working environment with a stronger culture of support and collaboration.
According to a Pew Research Center Social and Demographic Trends survey, respondents indicated that they found women more honest and intelligent than men. 80% of respondents thought that women were compassionate while only 5% thought the same of men. Meanwhile, 70% of respondents found men to be arrogant while only 10% felt the same about women.
Women tend to be more creative
According to research by the Kauffman Foundation, women typically start their businesses with only half the capital that their male counterparts have. Women are also less likely to receive funding from venture capital companies, angel investors, or federal funding programs. Due to this lack of resources, women tend to be more creative with what they have.
Women generally have to juggle multiple responsibilities and wear different hats. In a single day, they have to balance households, dependents, careers, and personal care. They learn to think on their feet, adapt to new situations, and make bold decisions. From their diverse roles and experiences, they gain the knowledge to come up with innovative ideas and solutions.
With women making up half the population of the world, a greater female influence means new solutions and services designed to address their specific pain points. Imagine the potential of accessing an entire market of women that are currently largely ignored. As women come up with unique and creative ways to make life better, their businesses thrive as well.
Women drive economic and social growth
There are 12.3 million women-owned businesses in the US as of 2018, compared to a mere 402,000 in 1972. These businesses employ 9.2 million people and generate $1.8 trillion a year for the economy. With more women leaders come the opportunity to provide mentorship for young women, induct more women into the workforce, and improve pay equality.
Because women are often responsible for the upkeep of the household, they can invest up to 90% of their income back into the local economy. According to the World Bank, this is a considerably higher percentage than men would typically invest. One reason for this is that men are more likely to spend money supporting personal lifestyle habits such as drinking or smoking.
When women purchase items for their household, they invest in healthcare, nutrition, education, and income generation. These not only support the local economy but also help their families to break out of the poverty cycle. Women who have access to their own income are better positioned to advocate for their rights and combat entrenched cultural barriers.
Women entrepreneurs are changing the business landscape for the better. They are setting the stage for a more equitable future for their children and building more sustainable and socially-responsible businesses. Numerous global organizations have emphasized the need to foster more women-owned businesses, particularly in rural communities.
Although the number of women-owned businesses has risen dramatically in the last decade, it may take several more years before women entrepreneurs receive the same access and opportunities as their male peers. If we want to progress to a more equitable society, we need to ensure that women have more representation and a larger stake in the global economy.