Center Publication
Women Entrepreneurs Seek Knowledge To Grow Their Businesses and Support Next Generation of Entrepreneurs
Juanita M. Weaver
Center for Women’s Business Research
Linda Stevenson
Washington, DC – Women business owners came together in a series of three Entrepreneurial Dialogues to discuss findings from the Center for Women’s Business Research which show that women entrepreneurs take substantial business risks, use technology to achieve growth, and use multiple advisors.
The purpose of the Entrepreneurial Dialogues was to provide a forum in which to gauge the current state of women’s entrepreneurship, to share practical knowledge and best practices identified by research and to create the opportunity for women entrepreneurs to share business know-how with each other. National City was the exclusive sponsor.
“Research from the Center for Women’s Business Research provides insight into the best practices of women who are building larger, faster growing businesses,” said Sharon Hadary, executive director of the Center for Women’s Business Research.
“Our research shows they are more likely to produce key financial documents such as sales forecasts and break-even analyses, use multiple sources for advice, tend to serve large and sophisticated markets, and are more likely to be certified by a third party as a woman-owned firm. We presented these research findings, among others, and also encouraged the Dialogue participants to learn from sharing their experiences with each other.”
The research provided by the Center for Women’s Business Research provided the foundation and context for the dialogues. Four core areas were discussed: characteristics of women business owners; financial practices; use of technology; and use of advisors. The two main other issues that came out of the Dialogues were concerns around health care and concern for training the younger generations about entrepreneurship.
“National City is a leader in supporting women business owners and is currently in a five-year campaign to lend $3.5 billion to women-owned businesses across the country,” said Linda Stevenson, vice president/director of the Women’s Business Development Program, National City. “The Dialogues are just one of our many initiatives that provide the opportunity for successful women business owners to learn from each other and industry experts.”
The primary outcome was knowledge that informed business and personal decisions. The Entrepreneurial Dialogues were an opportunity for women business owners to learn from experts and from each other about both immediate and long-term issues of concern in running a business.
Characteristics of Women Who Lead Larger, Faster-Growing Enterprises According to the Center for Women’s Business Research, women entrepreneurs are risk-takers. According to a recent study, women business owners are twice as likely to take substantial or above average financial risks when saving or investing for their households than men in the general population. They were even more prepared to take risks when investing for their business. Approximately one in five (21%) were willing to take substantial risks, while 45% reported that they were willing to take above average financial risks when expecting above average returns.
The discussion at the Dialogues pointed out that the growing pains of moving out of a start-up phase to a sizeable business are challenging. The role of the CEO must change as the company grows. The shift could be characterized as the shift from working “on” the business to working “in” the business.
Financial Practices The Center’s research showed that women owners of larger firms use a wide variety of financial products, including commercial business loans or lines of credit. They also employ “bootstrapping” strategies, such as negotiating better terms for their accounts payable, speeding up customer payments, and leasing equipment.
Women owners of larger businesses are more likely to produce a greater array of financial reports more regularly, and more likely to use these reports as a management tool. This close monitoring of financial performance was considered critical to sustaining growth by the women business owners on the panels and in the audience.
The search for a banker who understands the issues confronting small business, especially service businesses, and who is willing to spend the time to provide financial advice and services was a common theme. The women business owners agreed that this would be a decisive factor in their selection of a bank.
Technology According to Center research, women owners of larger firms are setting the pace in adopting technology to grow their businesses. These women entrepreneurs are more likely than the women owners of small firms to include the Internet and e-commerce in their growth strategies (58% of women owners of $1 million plus firms vs. 31% of other women owners), and more than half (56%) of the larger firms use their Web site for e-commerce.
The women entrepreneurs who participated in the Dialogues embraced technology, especially as a tool to make traditionally local businesses scaleable on both a national and international level.
Advisors Center research shows that women owners of larger companies are more likely than women owners of smaller businesses to seek advice from multiple sources. Center data shows that women owners of larger firms also were more likely than women owners of smaller businesses to join multiple networks and associations to broaden their sources of advice.
The consensus of the Entrepreneurial Dialogue participants was that while seeking advice is important, no advisor can be right 100% of the time, and the final responsibility for deciding a course of action belongs to the entrepreneur.
Other Challenges and Future Vision Hedy Ratner, co-president of the Women’s Business Development Center in Chicago, provided insight into the process of receiving certification as a woman-owned firm.
Certification was encouraged as a way to ease the entry to corporate and government markets. Data from the Center for Women’s Business Research show that half of women-owned firms with $1 million or more in revenues are certified by a third party as women-owned firms, nearly two-and-one-half times the rate of other women-owned firms.
Rising health care prices were seen as a significant challenge to most of the participants.
Participants also wanted to find ways to encourage the next generation of women choosing entrepreneurship. It was agreed that educational opportunities are needed for young women and girls to learn more about entrepreneurship.
The Entrepreneurial Dialogues were held in Chicago, IL; Columbus, OH; and Pittsburgh, PA.
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Center for Women’s Business Research The Center for Women’s Business Research is the premier source of knowledge about women business owners and their enterprises worldwide. The Center’s mission is to unleash the economic potential of women entrepreneurs by conducting research, sharing information and increasing knowledge about this fast-growing sector of the economy.
Since 1989, the Center has generated research-based intelligence that has helped public- and private-sector leaders, advocates, and individual women business owners make informed strategic decisions for generating greater business opportunities.
National City National City is committed to giving small business owners the innovative banking services they need to grow their businesses and provide for their employees. Along with checking and savings accounts, these include specialized lines of credit, online banking and payroll services, employee benefit packages, flexible leasing programs, and Business CheckCards. National City is one of the leading small business lenders in the country and the No. 1 Small Business Administration lender in its banking franchise. Through its small business banking initiative, National City is expanding its small business banking product line and will provide more than $1.3 billion in small business loans and lines of credit in 2005.
National City is one of the national leaders in supporting women business owners. The bank is currently in a five-year campaign to lend $3.5 billion to women business owners. In communities throughout its banking franchise, National City employs a network of women business owner advocates – specially trained National City small business banking officers focused on supporting local women-owned businesses. National City also sponsors a number of women business owner organizations, such as the National Association of Women Business Owners (NAWBO), the National Women Business Owners Council (NWBOC) and ATHENA Foundation. www.nationalcity.com
Citation
Center for Women’s Business Research. “Women Entrepreneurs Seek Knowledge To Grow Their Businesses and Support Next Generation of Entrepreneurs.” Washington, DC.