Women Entrepreneurs: Growing in Number and Importance
by Nancy Michaels
US News & World Report, May 12, 2003 Issue
In the early 1990s, when companies were scrambling to keep up with rapidly changing technology, Kelly Gilmore noticed an unmet need for independent information technology contractors. At the time she was thinking about starting a family, but her job in sales for a Fortune 500 firm left little time for the demands of new motherhood.
So Gilmore carved out a dual solution in the form of CONNECT, a Littleton, Colorado-based IT staffing company she founded with partner Maureen Clarry. The business allowed the two women the flexibility they crave while providing them with an outlet for their entrepreneurial drive. In the years since, CONNECT has grown to a $6.8 million business.
The number of women-owned businesses in this country grew at twice the rate of all firms between 1997 and 2002, jumping 14 percent to 6.2 million, according to the Center for Women’s Business Research. Women-owned businesses account for 28 percent of all privately-owned businesses, and employ 9.2 million people. They contribute $2.38 trillion in revenue to the U.S. economy, according to the Small-Business Association.
In her book, “When Money Isn’t Enough,” Connie Glaser reported that male entrepreneurs are motivated by the potential to earn lots of money, while women start their own companies because they seek greater control over their personal and professional lives.
“Many women feel frustrated by the restraints and the glass ceiling of corporate America,” say Glaser. “They feel like stepping out of that structure.” However, women-owned businesses have also attracted the attention of American corporations, many of which seek them out as vendors under supplier diversity programs. Some companies take this interest a step further by developing programs specifically designed to nurture women as business owners.
Office Depot Chairman and CEO Bruce Nelson says it makes good business sense to cultivate this market, noting that one of Office Depot’s goals is to provide a forum for women to gain the knowledge necessary to grow and manage their own businesses. To meet this goal, Office Depot turns to the Women Business Enterprise National Council (WBENC) to find vendors to do business with.
WBENC offers national certification for women-owned businesses as well as business networking opportunities. “WBENC helps women business owners connect with companies such as Office Depot, UPS and Bank of America, who are sincerely interested and committed to doing business with women,” says Susan Bari, president of WBEMC.
Andrea Learned makes a living from helping corporations reach out to women. An expert on marketing to women, Learned says women have a different management style than do men. They are less hierarchical; more deliberate in their decisions and are more collaborative than men. Women also tend to view their business holistically, and not only see where it’s heading, but are patient about how to get it there.
“With women, the power is from the center out,” Learned says. “And they show that businesses can make it at a slow and steady pace.” The hurdles for women entrepreneurs tend to be higher than those for men. Startup money is harder to find, for instance. According to Nell Merlino, only 7 percent of the roughly $12 billion invested in new ventures in 1999 went to women-owned businesses.
Merlino is president and CEO of Count Me In for Women’s Economic Independence, a nonprofit organization that provides access to business loans, consultation and education for women entrepreneurs across America. Loans from $500-$10,000 are available through an online application process and are analyzed using a unique women-friendly credit scoring system. Even with adequate funding, women entrepreneurs face a range of pitfalls. However, these can be avoided. Following are tips to help women business owners succeed:
DON’T UNDERVALUE YOURSELF. Women tend to give away too much and charge too little, Learned says, especially those in service-based businesses. Learned suggests women in the service industry adopt value-based fees, rather than hourly. This involves pinning a dollar amount to your knowledge and services, and charging per project, not per hour.
REMEMBER WHY YOU STARTED YOUR OWN COMPANY. Women can quickly lose site of their desire to have a balanced life in the face of a demanding new business. Gilmore says she regularly has to stop and weigh the value of the task at the moment against her personal needs.
NETWORK, BUT IN A WAY YOU FEEL COMFORTABLE WITH. Many people who go into business for themselves flock to networking groups because they believe it’s the smart thing to do. This is true for men as well as women. But depending on your personality and preferences, these groups may not be the best forums for networking.
DON’T FORGET YOU ARE RUNNING A BUSINESS. Piling on the work/life benefits won’t do anyone any good if doing so cuts too deeply into the company’s bottom line. “One of the biggest lessons I’ve learned is how to create a culture that is attentive to the individual and allows you to still make it as a business,” says Gilmore.
DON’T BE AFRAID TO PROMOTE YOURSELF. “If your business is to thrive,” says Glaser, “you must market yourself and take credit for your achievements. If you don’t market your business, no one will know what you have to offer.”
Looking into the future, the Small Business Administrations projects there will be about 4.7 million self-employed women by 2005 - an increase of 77% since 1983. Since increasingly, conditions are lining up to help these women succeed, including corporations being ever more eager to work with women-owned companies, the future for the women entrepreneur seems very bright indeed.