The Role of Women in Small Business & (Some of Our Favorites)
As we celebrate Women’s History Month, most of us are thinking of trailblazers like Ruth Bader Ginsburg, Marie Curie, and Malala Yousafzai – and, for obvious reasons!
Yet we’d like to consider the contributions of some women who have made an impact in a different way: small business owners.
What impact have women had over the years in the realm of small businesses? Here’s a look at some of the female business owners we admire most, what impact women have had in recent history, and what still needs to be done.
The proportion of women-owned businesses
In any industry, men still consistently outrank women in terms of their earning power, and small business leadership is no different.
Employees of women-owned companies earn an average of just $38,238 a year, as compared to their male counterparts who earn an average of $54,114.
In 2018, women-owned businesses netted an average of $1.6 million in sales, shipments, and revenue while male-owned businesses earned an average of $3.2 million.
Yet there are promising signs that women might be catching up. Between 2014 and 2019, the overall number of female-owned small businesses grew by 21%.
The role of race and ethnicity
Traditionally, the percentage of entrepreneurs who were minority women has been very small. But recently, that’s changing. In 2020, 64% of all new female entrepreneurs were women of color, a statistic that shows great promise for minority women, as it effectively makes them a majority in this area.
And here’s another exciting statistic: the percentage of Latina-owned new businesses rose 87% in the same year.
Yet we still have a long way to go to break the entrepreneurship glass ceiling where minorities are concerned. Despite all this recent growth, 82.8% of women-owned firms are still led by white women.
Women who seek financing
The statistics show that women are less likely to seek financing for small businesses. According to the SBA, only 28% of Small Business Administration loans go to women. Does this mean that women are more self-sufficient, and less likely to require financing? Other statistics say no. Women’s businesses contribute just a little over 4% to total annual private sector revenue. This tells us that women could be even more successful if they sought available financing to the same degree as men.
In addition, women only receive 7% of available venture money for startups.
Female Business Owners We Admire
Now that we’ve taken a look at the current state of female entrepreneurship here in the US, we couldn’t resist the opportunity to give a shout out to some of the women we admire the most!
- Lori Greiner
We watch a lot of Shark Tank around here. Ever since Lori launched her first product in 1996, she has been helping other female entrepreneurs achieve their dreams through financial and educational support.
- Margaret Thatcher
- As Europe’s first female prime minister, Margaret Thatcher paved the way for women in both politics and businesses around the globe. She faced a very weak economy and was forced to make difficult decisions that were not always popular. However, her perseverance was admirable, and helped to solidify her legacy.
- Marie Curie
Marie Curie won the Nobel Prize not once, but twice! She was the first woman to win this prize, and still the only woman to win in two different categories. Need we say more?!
- Sara Blakely
- We may have said this before, but we watch a lot of shark tank around here. One of our favorite guest judges is Sara Blakely, Founder and Inventor of Spanx. She was the youngest self-made female billionaire, after she started out selling fax machines door to door to pay her bills. She is known to be a fantastic leader, always putting her team first.
- Kendra Scott
Kendra Scott is a loving mom, a driven entrepreneur and a designer who believes in giving back. She founded the Kendra Scott Women’s Entrepreneurial Leadership Institute here at UT, aiming to strengthen the next generation of courageous, creative women leaders who will change the world in business and beyond.
As women-owned small businesses continue to grow, there is a hope that they may begin to more accurately reflect the gender and ethnicity of the larger workforce.
These businesses can add valuable new jobs to the economy, as did Tierra Kavanaugh, whose company TKT & Associates doubled its employees in just a few years. Another woman-owned business, Enspire Energy, provides energy solutions to the Mid-Atlantic region.
Continued investment in women-owned businesses like these is a surefire way to employ larger amounts of people across all gender and race lines and to boost the economy.
The success of female entrepreneurs in the face of the many obstacles stacked against them is evidence that you just can’t keep a strong woman down. As employers and problem-solvers, women-owned businesses are a valuable piece of our economy, and they’re not going anywhere anytime soon. Back