Currently, only around 30% of European companies are owned by women, and the World Economic Forum’s 2020 Global Gender Gap Report estimates that it will take around 95 years to close the gender gap globally. A report from the McKinsey Global Institute found that greater female equality could boost the global economy by $12 trillion (£9.5 trillion) by 2025. In an ideal scenario, this figure could rise to $28 trillion (£22 trillion), highlighting the huge economic benefits of gender equality.
“This impact would be roughly equivalent to the current economies of China and the United States combined,” the study said.
Inequality faced by women in business
Inequality is rampant in the business world, with many gender disparities in the field — the World Economic Forum reported in 2019 that women earn just 54 cents for every dollar men make — and this pay gap reflects broader systemic issues women face in the workplace.
In the venture capital industry, the difference is even more stark: A study by researchers at Harvard, MIT, and Wharton found that more than two-thirds of investors choose to fund a presentation with a male presenter over one with a female presenter. This bias persists despite evidence showing that companies founded or co-founded by women often outperform those led solely by men.
A Harvard Business Review study shows that women outperform men in most leadership roles. They also outperform men in several key skills, including problem-solving, creativity and teamwork. In addition to the innate leadership abilities that are essential to entrepreneurial success, the study highlights the immense potential women have when given equal opportunities through development, mentoring and access to credit.
The rise of female entrepreneurs
According to Credit Suisse’s 2018 Global Wealth Report, women currently control 40% of the world’s wealth, a figure that has risen steadily throughout the 20th century. Last year alone, approximately 250,000 women-owned businesses were founded, reflecting a significant increase in female entrepreneurship.
The report also highlights that minority-led organisations have a higher representation of women in leadership, with 20 per cent of these companies having a female CEO – a trend that signals a positive change towards greater inclusivity and diversity in business leadership.
5 important tips for women who want to start their own business
Michelle Ovens, founder of Small Business Britain and f:Entrepreneur, is on a mission to celebrate the growing number of female entrepreneurs who are making a major contribution to the economy and inspiring many in the process. Here are five key tips to help women succeed in their own businesses.
1. Build a strong network
Establishing a strong support system is important for any entrepreneur. Networking can provide you with valuable connections, mentorship opportunities, and support from other business owners. Joining industry groups, attending networking events, and utilizing social media platforms like LinkedIn can help you build a solid network that can support and move your business forward.
2. Fund wisely
Many female founders are hesitant to cede control to traditional “men in suits” investors. Instead, you can create a comprehensive two-year business plan and discuss funding options with a bank. It can also be beneficial to explore alternative funding sources, such as grants, crowdfunding, and angel investors that support women-led businesses. Understanding the different funding options and choosing the right one for your business can help ensure financial stability without sacrificing control.
3. Seek mentorship and learning opportunities
Getting guidance from an experienced mentor in the business or accounting field makes it easier to avoid common pitfalls. Speaking with someone successful in the entrepreneurial world can provide invaluable insight and advice during the early stages of your business. Consider joining a mentorship program, seeking out industry veterans, or connecting with successful entrepreneurs who are willing to share their knowledge.
4. Be adaptable
Flexibility is the key to surviving and thriving in an ever-changing business environment. Having an adaptable business model and an open working environment in place allows your business to bounce back from unexpected challenges. Staying agile and pivoting when needed can help you respond effectively to market changes and seize new opportunities as they arise.
5. Strengthen leadership
Leveraging and continually developing your leadership skills can differentiate your business. Effective leadership involves not only managing your team but also inspiring and motivating them. Attend leadership training programs, read extensively in leadership strategy literature, and continually evaluate and refine your leadership approach to ensure it is aligned with your business goals and values.
As Michelle Ovens and other advocates continue to highlight, the rise of female entrepreneurs is a testament to the potential that can be unlocked when women are given equal opportunities. By adopting these tips and cultivating a supportive ecosystem, aspiring female entrepreneurs can overcome challenges and achieve business success.
