3 Major Challenges Female Entrepreneurs Face When Starting a New Business
On paper, female entrepreneurs in Australia seem to have it made. 2019 numbers from the Australian Bureau of Statistics show that 12.1% of the country’s 5.9 million employed women are now their own bosses, heading over a third of all small businesses established in the country. It sounds wonderfully progressive until you realise that the statistics are only telling part of the story: women-owned businesses in Australia are still firmly in the minority. A techcrunch article by GenéTeare in 2017, stated that only 17% of all start-ups have a female founder; as of 2019 there are less female CEOs among the ASX200 (6%)vs 2018’s (7%); and of the 25 new chief executives appointed that same year, only 2 were female.
It’s true that the path towards the top is difficult and rife with challenges regardless of one’s gender. But The World Economic Forum reports that the gender gap is widening rather than narrowing; women entrepreneurs often find themselves battling tough odds to make it in the world and are presented with a variety of hurdles not experienced by their male counterparts, despite starting businesses in the same industries.
Forewarned is forearmed, and women entrepreneurs can better prepare for the hurdles on their path if they know exactly what they will be facing. Below is a list of the biggest struggles that female entrepreneurs face—and how to conquer them like a boss:
1. Maintaining a Balance between Home Life and Business
Women entrepreneurs are not often just business owners; they have spouses, children, and various other responsibilities. While it’s easy to say that women can have it all, balancing one’s personal and professional commitments can be tricky. More often than not, a woman has to decide which one will more of her time, and the reality is that being a working mother can sometimes hold a budding entrepreneur back from reaching her full potential.
Thankfully, culture is shifting to allow for more flexibility. Women and men alike are having trouble with work-life balance, thus fuelling the push towards healthier ways to do both and still win. Devoting equal amounts of time to both your family and work and setting clear boundaries between the two is a healthy way to approach the work-life balance. Dedicate a specific number of hours to the business and adhere strictly to them. Don’t bring your workhome as it could pose a distraction while spending quality time with your family. Finally, you should seek help from others that can share the burden. Build a strong support system around you. Defying expectations. Beyoncé brings her children Blue Ivy, Rumi, and Sir with her on tour, proving that you can be a worldwide superstar and be a phenomenal mother at the same time. If she can do it, so can you.
2. Receiving Less Funding
According to a 2018 survey of 3,000 entrepreneurs worldwide conducted by Melbourne-based graphic design platform 99designs, male entrepreneurs were twice aslikely to raise $100,000 or more of outside funding for their start-up ventures than females. These numbers are consistent with ones obtained from a survey conducted in 2017, proving that women-led businesses have a harder time receiving funding and raising capital, and when they do, they receive considerably less than their male counterparts even in the same industry. This is, rather hilariously, because investors—often men—assume that women inflate their projections just like the men and therefore provide funding at lower levels than requested. On the contrary, women tend to be more conservative about projections and pitch realistic figures. Furthermore, women are often denied loans due to gender and culture-related biases; financial institutions tend to favour businesses owned by men.
Female entrepreneurs looking for investors will have to get creative when it comes to obtaining funding. Experts recommend reaching out to venture capitalist firms with female partners who will be more likely to invest in women-led start-ups, but even those are few and far between. To capture the attention of the big players, women business owners should build confidence by having an impressive business plan and a team that can execute it well.
3. Gender Discrimination and Stereotyping
As detailed above, women face gender discrimination and stereotyping in both overt and subtle ways almost as soon as they decide to embrace entrepreneurship. Getting turned away for a loan due to one’s gender is only the tip of the iceberg, but it’s a significant one. Small-business loans for businesses owned by women in the United States dropped 70% between 2007 and 2013, according to a report by the California Reinvestment Coalition. Venture capitalist firms are in effect old boys’ clubs that only cater to their own tribes, investing in start-ups and businesses run by men who went to the same schools as them or run in similar circles. There is also plenty of anecdotal evidence to suggest that women entrepreneurs find it harder to be taken seriously in leadership roles, especially in male-dominated fields and industries.
Gender bias exists everywhere, and women often find themselves having to live with the short end of the stick. In a world where men have the advantage, women should learn how to abandon self-doubt and negativity, focus on talking themselves up instead of down, and work with other women to lift each other up. Link up with women entrepreneur groups online and in-person, build a strong network that can help you take your business further, and help other female business owners like yourself do the same.
Now that you know what you’re up against, you can arm yourself to overcome these adversities and succeed as a female entrepreneur. Don’t let your gender get in the way of becoming a successful business owner; instead, use your uniquely female characteristics to carve your own path in the world.