Though women entrepreneurs are on the rise, they still face unique challenges in starting and running their businesses. To succeed, these women must be resilient and resourceful, often working twice as hard as their male counterparts. Here are some of the biggest challenges that women-owned businesses face.
Unfortunately, gender bias is still a significant issue in the business world. Women often face discrimination when seeking funding, hiring employees, and even attracting customers. This bias can make it difficult for women to get their businesses off the ground.
Even when their business is a success, women leaders are still seen as weak. For instance, they can be targeted by unscrupulous employees who use their company to commit fraud. In such cases, women company owners must fight back with experienced corporate fraud lawyers to protect themselves and their companies. Fighting back and standing your ground with competent support will prove your strength and capabilities.
Another challenge women business owners face is that some customers may not take them seriously. This is especially true if the business owner is young or if the business itself is small.
To combat this, women business owners must be professional and competent at all times. They should make sure their marketing materials are high quality and accurate. They should also provide excellent customer service to counter such biased customer perceptions.
Access to Capital
One of the most common challenges women-owned businesses faces is access to capital. This is often because women tend to have less collateral and fewer assets than men, making it more challenging to secure loans and other forms of funding.
Investors also tend to show little confidence in women business owners. According to data from Fortune, of the $85 million in venture capital funding released by investors in 2017 in the U.S., only 2.2% was given to women-owned startups. The funding given to women-owned businesses averaged only a little more than $5 million. In contrast, the average funding granted to businesses owned by men was $12 million.
The share of venture capital funding given to women-owned startups did not change and stayed at 2.2% in 2021 according to data from Crunchbase. Lack of capital is a significant hindrance to success.
One way that women business owners can raise capital is through crowdfunding online. This option allows businesses to pre-sell products or services in order to raise funds. It’s a great way to get your business started without having to go through the hassle of traditional loans or investors.
They must also explore various sources of funding, such as government grants and private organization grants. Many of these are specifically meant for women. The U.S. Small Business Administration (SBA) has a free Lender Match service. Check out the Grants for Women website and this SCORE article for a list of grants.
Lack of Mentors and Role Models
Another challenge faced by women entrepreneurs is a lack of mentors and role models. This can make it difficult for women to find guidance and advice when starting their businesses.
SCORE Association, in partnership with the SBA, offers free mentoring to women business leaders by video, online chat, phone, or email. You can request them to match you with a mentor or search for your mentor on their website.
Work-Life Balance for Mothers
One of the biggest challenges faced by mothers who own businesses is finding a work-life balance. According to research data published by Mastercard in March 2022, 58% of women business owners put up a company to have more time with their families and improve work-life balance. Ironically, 29% of them now say they struggle to achieve this.
This is often because women feel guilty about spending time away from their children or spouses. They also tend to shoulder more responsibility at home, such as taking care of the house and family.
To achieve a work-life balance, it’s important to set boundaries and make time for yourself. This can be difficult when you’re running your own business, but it’s essential for your well-being. You should also delegate responsibilities whenever possible and make use of child care options, such as daycare or a nanny.
Women Business Leaders Will Triumph
These are some main challenges faced by women-owned businesses. While they may be difficult to overcome, it’s important to remember that you’re not alone in this. There are plenty of resources and organizations that can help you succeed.
Despite the challenges, women-owned businesses are on the rise. These businesses are vital to the economy and provide much-needed jobs and products. With the right support, hard work, and determination, women entrepreneurs can overcome any obstacle and build thriving businesses.