This article is written by Professor Heather McGregor, Provost and Vice Principal at Heriot-Watt University Dubai.
Risk, never forget, is a four-letter word. It is always scary starting something new. It is even more daunting when it means leaving your salaried employment to follow your passion. What happens if you fail? For women, entrepreneurial debuts can be significantly more intimidating than for men. According to the World Economic Forum, although women entrepreneurship is growing, men still outnumber women 3 – 1 in business ownership. As per a McKinsey study ‘The Power of Parity’ India has one of the largest opportunities in the world to boost GDP by advancing women’s equality, by 2025, improved gender equality will increase India's GDP by $770 billion. But that would require a lot of change and progress. The report further states that more than 70 percent of the potential GDP opportunity comes from increasing women’s participation in the labor force by 10 percentage points
Starting a business can be demanding, and women face unique challenges when doing so that their male counterparts do not. But when the economic benefits are realised, entrepreneurship for women also means decreased dependency, more financial control, and greater income security.
Barriers in place and Soft Skills to Cultivate
Although running a business might look like an identical process for both genders, women face some unique barriers. In some cultures, opposition can come from families and societies that expect men to take more of a leading role. In addition, women are often raised with a different focus to men, which conditions them to look at the world in a different way – a research report from Mckinsey famously said that women were raised to please, while men were raised to perform. Funding is another barrier – According to Makers India’s report on the State of Women in Tech Entrepreneurship in India, women founded and co-founded startups account for less than 6 percent of total investments infused into the Indian startup ecosystem.
Luckily, many women are blessed with skills that can help them to overcome these barriers. Patience, for a start, which is a useful attribute when trudging around multiple banks and venture capital firms looking for finance. Consistent risk assessment is another skill women enjoy – academic studies have shown that the male hormone testosterone can lead to irrational decision-making. Multi-tasking – anyone who has juggled family and a career knows that being able to focus laser-like in the moment is critical if you want
to get anything done. Finally, perseverance, in having a strong work ethic and not compromising values, is the hallmark of a good leader and improves the chances of success.
Being an Entrepreneur
The number of female entrepreneurs is increasing globally, but there are still a lot of challenges that women face in the modern world. The recent global pandemic showed major flaws in the corporate world, and women, specifically working mothers, were disproportionately affected. According to Azim Premji University’s State of Working India Report 2021, during the lockdown and the months after, 61 percent men remained employed compared to only 19 percent women, while just 7 percent men lost their jobs compared to 47 percent women.
It is no surprise then that one of the biggest motivations for women to embrace entrepreneurship (and this was certainly true for me) is to control our own agenda and have flexibility. Whether we're referring to children or ageing parents, the reality remains that women are still the primary caregivers. Autonomy to prioritise family and work without incurring the wrath of your boss comes with running your own business. The ability to set your own schedule makes it easier to make time for family, recreation, and focus on a healthy lifestyle.
Above everything else, one of the most important reasons why more women are looking towards entrepreneurship is that women want to make an impact. Women have the power to address gender equality. A 2018 INC and Fast Company report surveyed women entrepreneurs and found that they are more likely to hire women. According to a Kauffman Fellows report, startups with a female founder employ 2.5x more women while companies with both a female founder and a female executive hire 6x more women. Being able to help other women to advance is a major benefit of running one's own business.
Women are also known to be especially good at spotting market gaps. Research by the British Chamber of Commerce shows women have a better understanding of market needs resulting in creating innovative products and using technology in business. Another study in the United States showcased that women account for 85 per cent of all consumer purchases. Women are usually responsible for deciding which products and services to purchase to best meet their needs and that of the family. As successful businesses rise on the back of market gaps, women’s entrepreneurial spirit in identifying the gaps is a recipe for winning startups.
From One Entrepreneur to Another
My entrepreneurial journey started as a way to have more control over my time, be closer to my family, and to support women's representation. I also wanted to invest my time, money and energy into something which would have greater impact than I was able to as an investment banker in a huge bank where I was toiling away for faceless shareholders. I didn’t start a business in my garage – I went and found a small business with a sound business model that lacked ambition and scale, and joined it and then bought it. The flexibility it gave me allowed me to finish my PhD and try out my thoughts on management and leadership. The success of the venture allowed me the opportunity to found a charity (the Taylor Bennett Foundation www.taylorbennettfoundation.org which works to promote diversity in the communications industry), and to become a founding member of the steering committee of the 30% Club, that helps to raise the representation of women at senior levels within publicly listed companies.
The single greatest investment I made in the success of the business and my personal entrepreneurial journey was in my social capital. Strong networks help you along the way, and academic research shows us that building trust with others lowers transaction costs. Networks are also a source of information and inspiration; there is a lot to learn from others. It is important to have an open mind, listen to other perspectives, and be curious about how other businesses are set up and run. While not everyone is willing to be a mentor, many female entrepreneurs want to build a thriving entrepreneurship network and are happy to share their journeys and stories.
In conclusion, entrepreneurship is not an easy proposition, but it can be extremely fulfilling when done with passion, sincerity,and dedication. Although there is no formula for overnight success, visualising what the next five or even ten years can look like, and persevering on the path, can help make the vision into reality. So can the help and support of those around us. As a woman entrepreneur, many challenges exist, but if we reach out to our networks, they can all be overcome. Remember, there is no such sentence as ‘I can’t do it’. The word that completes that sentence is the word ‘alone’. We all need others to help us achieve our goals.
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