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5/2/2019

The State of Women Entrepreneurship: Powering the Future

With an estimated 11.6 million women-owned businesses in the U.S. employing nearly 9 million people and generating upwards of $1.6 trillion in revenues, it’s clear women are making significant contributions to the American economy.

Women of color in particular are experiencing success in business. Of the new women-owned businesses created between 2007 and 2016, 78 percent (or nearly 2.8 million) are owned by women of color.

These numbers indicate positive change for women entrepreneurs, but there’s still work to be done. Only about 2 percent of women-owned firms generate over $1 million, and less than 1 million women-owned businesses have employees beyond the owner.

Let’s take a look at a few of the obstacles women business owners are overcoming to reach their full potential.

Role models and mentors

Getting started in business is difficult without someone to guide you. Adults in North America with access to a mentor, for example, are five times more likely to say they are planning to start a business than those who do not have a mentor (10 percent versus 2 percent). After getting started, business owners who are mentored tend to experience greater success. Research shows that those who receive three or more hours of counseling report higher revenues and employment growth rates.

Building good credit

The ability to access financing to grow a small business relies on many factors. An important one is having good credit. When a business owner has good personal credit, it shows a lending institution that he or she has a history of responsible financial habits and decisions. 

To build good credit, there are a few tips you can follow. First, only borrow what you can afford. While it can be tempting to put charges on a credit card when you know you don’t currently have the cash, it’s easy to fall into excessive debt. Other methods include paying your credit card balance in full every month and making those payments on time.

All small business owners should feel empowered to seek the resources they need to make their ideas become outcomes. Working with a mentor and building up good credit are two small ways to start.

All data points cited in this post can be attributed to “Tackling the Gender Gap: What Women Entrepreneurs Need to Thrive” from the U.S. Senate Committee on Small Business & Entrepreneurship: https://www.sbc.senate.gov/public/index.cfm/women-s-entrepreneurship

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