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The good news: the percentage of women-owned businesses has been steadily increasing. The percentage of firms that women own and run has in the past ten years according to a report in The Atlantic in 2015.
The not so good news: less than one-third of American companies are owned by females. That is an increase of only about three percent in the last two decades. Women still face some challenges when starting their own companies. So it's good to know about the many resources that offer solutions for female entrepreneurs.
Is this a good time for women to start their own business? Their percent of ownership has grown but not quickly. But at the same time the resources available to help women succeed has been growing very quickly. Perhaps one characteristic of females who own a business is a propensity to help other women succeed as well. Women can find local networking groups, national advocacy organizations, and all sorts of tips and helpful guides.
Females face some obstacles different from those men face. Still a great idea, a good business plan, adequate funding and moral support can be keys to success. Here are five important resources to help you attain them all:
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News September 2018 Guidant Financial recently conducted a survey to learn more about women in business in 2018. They report that there are currently more than nine million woman-owned businesses in the U.S. Together they employ close to 8 million people and bring in more than a trillion dollars in sales. women make up a little over a quarter of businesses, a significant increase over the percentage in 2017. A little over half of women business owners are less than 50 years old. And, not surprisingly, their number one greatest challenge is getting enough financing to start or grow their business. Guidant recommends ROBS for business financing — this is the practice of using money from your 401k or IRA to finance a business. You can discover more about this option in Fund a Startup Business.
Update March 2018
Women over 50: looking to start your own business? You may be in a great position to do so! While men tend to become more set in their ways as they age, women are more apt to be open to new ventures ideas and more willing to work cooperatively with others. And those are great traits for an entrepreneur. Or at least so says a entrepreneurship professor at the University of St. Thomas in Minneapolis. And senior entrepreneurs are doing very well these days. Of course you probably will have to go without a salary for a while. But with some careful spending and determination to make things work you could be putting together a great future. And women tend to be strong in important areas like presetnce and optimism. Be realistic about how much time you have to spend on your new venture, do the necessary research and get some training if you have to, and talk — and listen! — to potential customers. Get some free help from the SBA, and read our regularly updated article about funding a startup. And good luck!
Women face a number of challenges when they want to start their own company. Funding, family obligations, and simply learning the basics of running a business are just a few examples. To get started, these excellent resources offer solutions to those obstacles and more:
1. Find Funding for Women-Owned Businesses
One of the primary problems may be the unique challenges that women have when they need to raise money to run and grow their companies. Surveys find that women tend to have less money saved and have lower credit scores than their male counterpoints. This could be because the average salaries are lower for women than they are for men. Certainly, many women still take on much of the burden of caring for the family, and this may slow career growth. In addition, the kinds of businesses that women decide to run might be less attractive to lenders or other financing sources.
Increasingly, women may need to turn to alternative types of funding for female business owners. For instance, a new generation of online lenders will look at actual data about the way the company is run to decide if they will approve a loan. That means that credit scores, owner equity, and other traditional measures of creditworthiness aren’t the only factors considered. Women who have had trouble qualifying for traditional bank loans or finding investors might consider these new, high-tech alternative sources when applying for small business funding.
2. Get Motivation and Useful Resources from Women Who Have Launched Businesses
A female entrepreneur named Victoria Colligan began a website called Ladies Who Launch to help provide support and resources for other women who want to take an entrepreneurial path. Along with other women who lead businesses, Ms. Colligan offers tips, stories about role models in business, and even business forms and templates on this website. She has gotten nationwide attention for this effort. In addition, she has connected with thousands of women who want to start or have already started their own companies. This site has sparked an incubator program for females who hope to start their own companies. Besides that, Ms. Colligan and other associated business leaders have written and published helpful guides that provide how-to information and motivation. Anybody can make use of the site's resources for free.
3. Plan For Growth
If you are a woman business owner, are you setting appropriate goals for growth? Did you know that according to research the best — and in fact only — way to accurately predict the growth of a business is the goal the owner/entrepreneur has set for growth! If you are putting together your business plan, be sure to include planning for future growth. And if you go to conferences and seminars — especially any particularly for women — complain if the topic of planning for future growth is not covered. That can have a big impact on the success of your company and the amount you actually can grow.
4. Learn to Write a Solid Business Plan
The SBA and its partners offer many different forms of help for women who want to start a business the right way. Future business owners should expect to be busy, but it's always best to work according to a plan. According to the SBA, every successful business begins with a solid business plan as this document provides an outline of the company's plans for the next few years. These documents aren't meant to be set in stone. However, they are meant to provide direction and focus for the business owner's initial efforts. In order to get potential funders or partners to take a new business idea seriously, it has to contain certain essential elements. Furthermore, a well-crafted business plan needs to stand out against potential rivals. Check out our review of the SBA and the many resources they provide for current and aspiring business owners.
5. Look in to Microfinancing organizations
Once mostly focused on developing countries Microfinancing is now alive and well in the United States. Institutions involved in microfinancing are dedicated to helping folks with little or no business experience, with low incomes, and usually with no banking relationships to start and manage their own businesses. Their services include not only financing help but also training, mentoring and ongoing support. Participants learn not only about marketing but also financial management skills. Check out this review of microfinancing in the U.S. to learn more and see if there is a participating group near you.
6. Connect, Learn from, and Mentor Other Women in Business
The National Association of Women Business Owners (NAWBO) offers national advocacy and local chapters. In fact, this organization has spread all over the country since its founding in 1975. It started with a fairly small group of women in the DC area who wanted to build a local and professional community. NAWBO now has over 5,000 members from 60 chapters all across the nation. It prides itself on representing the millions of women-owned businesses in the United States.
This organization also supports the Institute for Entrepreneurial Development. This nonprofit organization offers grants for educational efforts. It helps to fulfill the mission of educating current and future female entrepreneurs. Other helpful resources for members include access to government contracts and funding, an online business library, and a chance to network both online and offline.
7. Join a Great Group of Moms in Business
It shouldn't be any more exceptional for a woman to run a business if she has children than it should be for a man. Of course, perspectives and obstacles may make the challenge of starting and growing a company more difficult for women than for men. In some ways, running a business might be the perfect opportunity for a mom because certain types of companies can be run from home or can conform to a flexible work schedule and lifestyle.
In this spirit, the organization Founding Moms offers both online and offline resources for future and current entrepreneurs who also have children. Women who participate in this group come from all sorts of industries, and they can come together to share their unique perspectives and experiences. Best of all, they can benefit from the support, advice, and experiences of other successful moms in business.
Armed with these resources and the improved business environment expected in 2017 and beyond, this could be a great time to fulfill your dream of starting your own business! For additional information and resources also see Grants for Women Owned Business and Small Business Grants for Women.