In the run up to International Women’s Day on March 8th, we’re looking at the role of women in the workplace – and the importance of diversity to a successful business, writes Susie Logan. Today, I’m looking at the rise of the female entrepreneur – which might have started a bit earlier than you’d think.
Women can bring with them a unique perspective and a wide variety of skills– one of them seems to be the ability to start up their own businesses. More and more women aren’t just reaching a higher level within existing organisations like Standard Life – they’re also creating their own successful businesses.
In fact, women are now founding companies at an unprecedented rate. In 2012, a Global Entrepreneurship Monitor (GEM) report revealed 126 million women are starting – or running – their own businesses, and 98 million oversee established (operating for over three and a half years) firms.
Put simply, that means 224 million women entrepreneurs are having an impact on the global economy (and this survey only includes 67 of the 188 countries recognised by the World Bank).
Step back in time
Reports like this of the growing numbers of female entrepreneurs, although positive for supporters of diversity, suggest that women are only just ‘catching up’ with men when it comes to setting up their own businesses. But the truth is that although women haven’t had the same freedoms as men, they have been business owners for centuries.
In the 17th century, Dutch colonists arriving in America operated under a matriarchal society and inherited money and lands – so women became business owners through their inheritance.
And Madame Marie Tussaud, a wax death-mask maker, took a collection of masks of guillotined aristocrats from France on a tour of Britain and established a base in London. The exhibition grew over years as she added more models, and she died a success in 1850 – at the age of 90.
A change in attitude
As we discussed last time, in the 20th century, women took the jobs of men when they were away fighting in the wars and some held onto senior positions when the men returned, often injured, or didn’t return at all. But it was difficult for them to set up on their own as so much bureaucracy was in favour of men.
By the 1970s, divorce rates were rising and many women took on the role of sole provider. More women entered the workforce, and with the advent of technology, and the end of restrictions on women obtaining loans and credit without their husband’s signature, ideas were able to become reality with women in the driving seat.
Not just a man’s world
The rest is history. Think Linda Bennett, founder of LK Bennett, Michelle Mone, creator of Ultimo underwear, Victoria Beckham, a hugely successful fashion designer. But is it just clothes and shoes? Of course not. Most of the money being made by women is now in three core sectors: retail, professional services such as consultancy, accounting or law, and of course fashion. And when women are asked which industry they would choose to start a business in today, the answers are e-commerce, travel, hospitality and leisure.
What about success? Over a third of female entrepreneurs said they defined it as profiting on their initial investment, 12% said it meant transferring their business to the next generation – and almost as many described it as making a social impact.
The drivers of success
What would make anyone want to ‘go it alone’? Starting your own business doesn’t exactly have the reputation of being easy. According to the Global Entrepreneurship Monitor report, “women are nearly one third more likely to start businesses out of necessity than men”. In other words, they see it as a solution to, for example, not being able to climb the career ladder within an organisation due to discrimination, or a way of juggling family life they feel they can’t achieve by being an employee. And you can see yourself how many women with young children appear on the BBC’s Dragon’s Den programme for entrepreneurs seeking funding – often with innovative, commercial ideas about how to make family life more fulfilling, convenient, practical – and profit.
Why else would a women become an entrepreneur? Maybe they have a specific idea for a business, or the passion to solve a particular problem. Perhaps they want to be in control, have more flexibility or work-life balance. Or maybe they have a very personal vision that they feel they can monetise.
The power of diversity
So why are women so successful when it comes to creating start-ups – after all, women-owned firms outperform those owned by male counterparts. Women entrepreneurs tend to achieve success because of their trusted status in the community. They also often have a passionate – and fearless – desire to bring their vision into reality, and an ability to multi-task, an essential skill for entrepreneurs.
Female entrepreneurship has come a long way and it’s exciting to watch so many start-ups emerging with women at the helm. For employers, it’s also a lesson. By being adaptable and flexible, and encouraging your employees to do the same, and by encouraging diversity, businesses can benefit from the skillsets of women within their business. Let’s celebrate female entrepreneurs – and the nurturing of female talent in our own organisations.
In my next article, I’ll get to meet some of the entrepreneurs I’ve been chatting about – watch this space!