As we commemorate Women's History Month, it is appropriate to reflect on the economic and societal contributions that women have made in the past. It is the shoulders of these women that all of us stand on and that gives us the springboards and the motivations from which to make a difference today. Although we take note that these women have boldly advanced the women’s economic agenda, we also notice an intangible unspoken context that is often the backdrop for women getting the opportunity to lead and for the circumstances that accelerate advances for women.The context is a tumultuous economic, political, corporate, or societal environment.
History and even present day, shows us that when there's turmoil, volatility, or uncertainty, opportunities are ripe for women to lead and excel. Whether it’s the Women's Suffrage movement or present day concerns of economic conditions for women business owners; turmoil has a way of ushering in a perfect storm for women to lead. If you consider the women that we have today that are leading global companies or countries, almost all of them rose to the helm when their organizations or countries had enormous challenges or were in need of transformational change. What is the old saying? “Chaos breeds opportunity?” Perhaps it is most true with respect to women’s leadership.
We believe that today provides a perfect opportunity, a perfect storm if you will, for women entrepreneurs. Interest rates are at record lows, creating a robust environment for commercial borrowing. Record levels of cash are on the sidelines with both institutional and individual investors and on corporate balance sheets. And all of these entities are looking for good ideas, particularly as the appetite for risk continues to increase in the market. The emergence of alternative funding sources, such as crowd funding, incubators and accelerators are starting to level the playing field for sourcing start-up capital. Plus, there are a record number of women in college, university and graduate school programs, increasing the number of women who are being exposed to educational collateral about leadership and entrepreneurship. Finally, the context has certainly been chaotic with the backdrop of the financial crisis, record levels of unemployment, and economic uncertainty. It is the perfect storm. The facts? Our research shows that women entrepreneurs thrived during the 2007-2010 economic recession.
There is no doubt that present economic conditions continue to be of major concern to women entrepreneurs. There are still hurdles for women entrepreneurs that we must continue to eliminate and overcome. Here are a few focus areas the National Women's Business Council believes should improve in order for women entrepreneurs to take advantage of this perfect storm:
Continue to Focus on Access to Capital. The National Women's Business Council (NWBC) research has found that businesses that start with more capital have higher rates of survival. NWBC research highlights a Kauffman Firm Survey which tracked a group of firms started in 2004. In 2010, the average woman-owned ﬁrm in the sample received $38,217 of new ﬁnancial capital, about half of what the average man-owned ﬁrm received. If women owned businesses are continuing to succeed in tough economic environments with less capital, we believe that the rate of success and job creation can markedly accelerate if these businesses receive more capital. Momentum encouraging financial institutions to increase lending efforts to women is underway. Most recently Treliant Risk Advisors and NAWBO issued a new report strategically outlining ways for banks to increase lending efforts to women business owners.
The economic impact of women-owned businesses is significant and growing. We believe that there is substantial opportunity for financial institutions, including community banks and credit unions to ramp-up their efforts to target and increase lending to women entrepreneurs.
Continue to Focus on the Development of Women Leaders.On the wave of the national initiative to propel women to their fair share of leadership by year 2025, the pipeline of women leaders is growing stronger with prominent women organizations, such as (WIPP, NAWBO, WPO, WBENC, AWBC, MOMs, and countless others) focusing on mentor match making and leadership training and development.
Continue to Expand Access to Markets. In 2011, the federal government implemented the Women-Owned Small Business Federal Contract Program (WOSB FCP) with the goal of giving 5% of federal contracts and award dollars to women-owned small businesses. According to a National Women’s Business Council report published last November, women-owned small businesses were awarded 11.5% of all contracts and 5.3% of all awards in 2012. Its policies and initiatives like the WOSB FCP program that broadens access to markets for women business owners and expands opportunities for women to access government contracts.
Continue to Focus onWomen Innovators in STEM. With technological advances in the health industry, digital media industry, and nearly every industry; the science, technology, engineering and math (STEM) field is ripe for entry of women innovators. Take Divya Nag—one of STEM’s youngest women entrepreneurs making advancements in what Forbes calls “attacking one of medicines biggest problems,” as an indication that women and girls are gravitating towards the STEM industry. And there are programs already in place to guide and incentivize women innovators. For example, SBA’s Small Business Innovation Research (SBIR) program encourages domestic small businesses to engage in federal research with the potential for commercialization. The SBIR program enables small businesses to explore their technological potential and provides the incentive to profit from its commercialization. This is a great way for women innovators to participate in the government’s high-tech arena.
Whether it’s expanding opportunities for women to pursue STEM, lead a Fortune 500 company, or getting more capital in the hands of women entrepreneurs, innovative policies must be put in place to support women’s impact in shaping America and America’s economy.
“The Perfect Storm for Women Entrepreneurs” written by: National Women's Businsess Council Chair Carla Harris.
Carla Harris is appointed by President Barack Obama as the National Women’s Business Council Chair. The National Women’s Business Council is a non-partisan federal advisory council created to serve as an independent source of advice and counsel to the President, Congress, and the U.S. Small Business Administration on economic issues of importance to women business owners.
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