This article is part of a Special Series titled How to #PressForProgress in Women’s Entrepreneurship by the Cartier Women’s Initiative Awards. The series contributes to the #InternationalWomendsDay dialogue on empowering women around the world through entrepreneurship.
However, as more and more women are starting and running businesses globally, it’s clear that the women’s entrepreneurship revolution has the potential to drive economies, and wise policymakers are paying attention.
In the U.S. alone, if all women-owned businesses disappeared, the economy would lose $2.8 trillion, resulting in a major blow for 23 million job seekers, according to the Center for Women’s Business Research (CWBR). Conversely, if society could access all the untapped potential these female-led companies possess, those businesses would have the possibility to generate $10 trillion in revenue (roughly three to four times greater than current numbers).
So how can policymakers ensure that they are fostering the ecosystems that will promote the success of female founders?
In countries and regions where women are the most successful in their entrepreneurial endeavors, policymakers address the three “Cs”: cash, coaching and culture.
Cash: It is well known that women are ‘cash-challenged.’ The World Bank has identified that there is a $300 billion-dollar funding gap for women globally. They start their business with less cash and then have a harder time obtaining it whether through customer revenues, friends and family, angel investors, banks or venture capitalists. The only source that seems to benefit women is crowdfunding where women raise 13% more than men.
To address this, innovative policymakers have encouraged women to seek out private corporations like the Cartier Women’s Initiative Awards, a business plan competition which provides the finalists $30,000 and the laureates $100,000 in each of the six regions each year. They have also incented special women’s funds through investment guarantees to invest more in women. In New York, the State has selected Golden Seeds, the largest woman-focused angel investment group in the country, to participate in its $100 million state fund for entrepreneurs. Finally, some countries are hosting sessions for women to learn more about how to access funding both in their countries and elsewhere. The Canadian Embassy in the U.S., for example, is promoting solutions by hosting “Enhancing Women’s Access to Capital,” an event for all women founders in DC, not just Canadians.
Coaching: Perhaps as important as cash, coaching and mentoring can help women accelerate the growth of their businesses. Governmental organizations like the U.S. SBA Women’s Business Centers or the government supported WECreate Women’s Entrepreneurship Centers in countries like Pakistan, Zambia and Vietnam, are providing essential business tools and guidance for early-stage women-owned enterprises, as well as access to a network of coaches and mentors. Historically, 75% of businesses that have been incubated have survived and thrived vs. only 10% of non-incubated businesses.
Culture: Beyond cash and coaching, culture plays a big role in a woman's success. One of the biggest cultural differences between men and women is the extra time burden women carry to handle family-related responsibilities. That’s undoubtedly why Prime Minister Justin Trudeau used his keynote speech at the World Economic Forum in Davos, Switzerland in January to say Ottawa will proceed this year with legislation to ensure equal pay for work of equal value in federal jobs as a "first step" towards getting more women into the workforce. He also said it's time for serious looks at parental leave and child-care policies. Trudeau cited estimates by global consulting firm McKinsey and Company that narrowing the gender gap in Canada could add $150 billion to its economy by 2026.
Celebrating women entrepreneurs for their effort and contributions as well as their success is another aspect of culture that is often overlooked. However, this too, is changing, as we start seeing that both social and mainstream media are giving more attention to women entrepreneurs, like the recent cover of Fast Company with Glossier founder Emily Weiss or the many women founders who make it onto Fortune’s 30 Under 30 list. As is often said, you cannot be what you cannot see.
Policymakers who address the 3 C’s challenging women entrepreneurs —cash, coaching and culture— have an opportunity to make a huge impact. And when they do invest in women, they will find that they are in good company.
Shelly Porges is a successful serial entrepreneur, investor and global entrepreneurship advocate. She is Managing Director of Reservoir Q Global LLC, an advisory and investment firm and a Board Member at the Global Banking Alliance for Women, among others. She also served as the former Senior Advisor, Global Entrepreneurship Program (GEP) at the U.S. State Department under Secretary Hillary Clinton.
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