Women-owned businesses are a critical part of the U.S. economy. Small businesses owned by women alone employ more than 9.2 million people and generate trillions in sales. Yet, women still face greater challenges in owning and operating successful ventures.
Gender discrimination, unfortunately, still affects the ability of women to advance in business and operate freely. Meanwhile, challenges in obtaining funding, streamlining performance, maximizing leadership potential, and adapting business models all can disproportionately affect women.
These major challenges make it harder to achieve all kinds of business goals. Being aware of these challenges, however, can help you thrive as a female entrepreneur. Here’s what you should know.
Although women make up 52% of the workforce, they only represent 14.6% of executive officers and 8.1% of top earners, according to the Center for American Progress.
This lack of representation in high-paying job brackets is an example of the glass ceiling effect at work. Women are often thriving in the workplace and yet they are ignored for promotion and advancement due to gender discrimination. It can be difficult for enterprising females to prove to their male colleagues the seriousness and drive they possess in the face of this discrimination.
This means women often have to work harder and innovate more to get the recognition they deserve. When seeking out investor opportunities, this can be especially true.
Female entrepreneurs face what is perhaps their biggest barrier to success when seeking out funding for their business. Any business needs financial backing to succeed, and studies have shown that women face a harder time securing loans and investor growth. If you’re a woman of color, the difficulty only goes up.
The U.S. Minority Business Development Agency reported that non-whites are three times more likely to be denied micro-business loans by financial institutions. These are loans that are often extremely vital to growing a business.
If they have imperfect credit, female entrepreneurs have an even harder time overcoming financial challenges. Luckily, however, growing networks of resources for women are striving to bridge these difficulty gaps. For example, the Small Business Administration has programs and grant opportunities designed specifically for female entrepreneurs, resources that just might help level the playing field towards equality in the workplace.
For women in the workplace, compounding issues can affect not only your performance but the performance of your entire operation. From disproportionate opportunities to difficulties in finding a work-life balance, these challenges present hurdles to success.
For example, the U.S. Commerce Department reported that women-owned businesses have a 21% lower chance of getting a federal contract than a competing male-owned business. Such discrimination in available opportunities can lead to a poorer performance from a company overall, thereby compounding the surrounding barriers to success.
Additionally, women often face greater work-life balance challenges that can make conducting business even harder. A Pew Research survey, for instance, showed that mothers with children were three times more likely than fathers to say that being a parent made it difficult to advance their careers. These difficulties require female workers to be even more creative in juggling their personal and business lives while remaining happy and engaged with their work.
To build a high-performance work environment, women in leadership roles need to create cultures of empathy and respect while ensuring that employees are incentivized and listened to. Such a culture can help female entrepreneurs in turn navigate the leadership challenges that they will face in managing a team.
With few women occupying executive roles, the unfortunate stereotype persists that women cannot or are somehow less apt to hold leadership roles. This can lead to all kinds of respect and performance challenges for a workplace managed by a woman.
Women frequently have to speak to rooms full of men, navigate boy’s clubs of male privilege, and counter the stereotypes that pervade about women being more emotional and less rational. Gaining respect and being taken seriously in this environment is a challenge all to itself. Overcoming these challenges takes agile and assertive leadership crafted for the digital age in which we live.
While it is entirely unfair that women need to demonstrate greater agility in leadership positions, it is the unfortunate reality for many women in such roles. Female bosses often need to work even harder than their male counterparts in innovating through critical thinking and technology, applying data-driven decision-making and foundations of collective knowledge. With technological tools and data at your back, anyone can more successfully navigate this discriminatory culture.
Adapting to the Business World
Because of the myriad challenges faced by women in business, female entrepreneurs must be especially adaptable in every aspect of the business world. This means staying up-to-date on technological innovations while mixing up management styles to suit your team.
One of the best ways to go about this is to build a network of resources at your disposal. From the American Business Women’s Association to the National Association of Women Business Owners, organizations are out there that can help you plan, adapt, and execute business strategies capable of overcoming any hurdles.
These resources can be invaluable for women who realize it’s time to give up the day job and venture out with a business of their own as well as for established female business owners. The right support network can help any woman overcome the challenges of owning and running a business, so begin building your network now.
Women in business face a disproportionate series of challenges than their male counterparts. With far fewer women in executive roles than men and a culture that often fails to take female entrepreneurs seriously, women have to work harder and be more agile when owning and running their own business.
Gender discrimination, funding difficulties, performance problems, leadership challenges, and overall adaptability can be impediments to achieving the kind of success you might dream of. However, with the right mindset and the right support network at your back, you can help mitigate these obstacles and thrive in the business world.