Experience and Challenges of Female Entrepreneurs


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It is a well-known statement that there are less females in the world who pursue entrepreneurship, in comparison to males. Data has shown that there is a significant positive correlation between the rankings of male entrepreneurs. However, the same cannot be said for male counterparts, whereby the correlation is almost close to zero. In this essay, we seek to further our understanding of the key encounters that female entrepreneurs face in terms of developing and progressing their business by investigating various factors. Firstly, we seek to broaden our understanding of the association and manner in which gender stereotypes and disadvantage interconnect to shape the general experience of female business owners. This is then followed by the societal perception of females, in terms of being able to manage a business alongside household roles and a ‘family life’. Finally, a more specific consideration using the example of financial capital and the lack of support to illuminate the obstacles that women are facing today. The availability of finance is a crucial element when encouraging people to open businesses and resultant performance of any enterprise.

An encounter that women, today in the 21st century, have to face is the idea of gender discrimination. This has been an ongoing problem in business for decades and gender discrimination has been extremely prevalent in the entrepreneurial field. Women have been deemed as being less advantageous than males in terms of business start-ups, societal acceptance and acquiring capital. It has been theorised by feminist philosophers such as Harding and Butler that ‘the masculine takes precedence and forms the foundation of “normative” knowledge; in turn, this ensures that the feminine perspective is positioned as oppositional to the normative discourse.’ Women are commonly believed to possess a greater amount of communion qualities such as; connectedness, timid, kindness and in general as being very soft. But on the other hand, men are associated with more agentic qualities (courage, aggressiveness, independent) .

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Gender stereotypes such as those listed not only categorise men and women, but also create a negative cognitive bias for future generations to continue to categorise men and women into specific personality classes. As a result of this, the future generations will also age with these “ill-founded, poorly informed and merely act to reproduce and reinforce mythical axioms pretraining to women, gender and entrepreneurship” . This in turn will not benefit women in any shape or form as the stigma associated with female entrepreneurs will continue to transcend throughout society.

Another element of gender discrimination that women face is the gender-pay-gap between men and women. Dolton and Makepeace found that male earnings increased after marriage, but the same effect was not apparent for women – within the employed sector . As a result of this women turn to self-employment as they feel that they can progress their careers further without being obstructed by a ‘glass ceiling’. Yet, data has shown that the gender pay gap also occurs even in the self-employed sector, within the same business market as males. A report carried out by Minda Zetlin (2018) concluded from her results that “one-fifth of female respondents had to charge less than their male counterparts in order to attract customers”, which also effects business growth and performance.

Results from a study by Gupata have shown that ‘gender-role stereotyping does play a role in the perceptions of entrepreneur and entrepreneurial intentions. She also noted from her study that there is a correlation between gender-role stereotyping not only in the UK, but also within the United States, India and Turkey. She concluded that the ‘think entrepreneur – think male’ generalisation is predominant in societies all around the world. Social norms have suggested that a woman should support their husbands via low paid labour or in some cases unpaid labour. This reflects “a natural extension of the ‘wifely’ role preserving the hierarchical ordering of the marriage relationship and the primacy of the male partner”. These characteristics that have been widespread as the social norm have not only changed society’s perception but also women’s self-esteem. Research carried out by Gupta et., al indicates that as a result of these generalisations, women have doubted their proficiencies when it comes to starting a venture of their own. They are also influenced to possess the characteristics of males, which hold the core foundation of being self-employed and an entrepreneur. This positions gender as one of the key challenges faced by female entrepreneurs.

There are known to be two different entrepreneurial groups for females in the modern era; Traditional entrepreneurs and New Modern entrepreneurs. Traditional entrepreneurs are acknowledged as those women who turn to self-employment as it is their best chance of achieving career and social triumph; due to their restricted educational and/or training qualifications. Whereas, New Modern entrepreneurs are women that are concomitant with more education, experience, networks and skills. The new modern entrepreneur has a history of profitable employment thus able to transfer the skills acquired in order to develop their business. The majority of female entrepreneurs are classed as ‘traditional entrepreneurs’ not only due to constrained education, but another contributing factor is the fact that many women lack previous job experience.

Lots of women “are most often the primary caregivers for children” , also referred to as ‘mumpreneurs’. This hinders the types of profession that they can pursue – hence, lots of females have to find the perfect balance between performing the roles of a businesswoman and also a mother. But many “have lost the balance between work and family” , and are not able to keep up with the high demands of offsetting this lifestyle. Hundley has provided indisputable evidence that men are outperformed by women without children in terms of earnings. Thus, “the presence of small children and greater hours of housework have a negative effect on female earnings” . Firms with concrete equality policies, within social welfare economies, are also more appealing and attractive than self-employment. This is mainly due to the provision of paid maternity leave, subsidised child support and part-time work flexibility. On the other hand, self-employed individuals have no such benefits and are therefore more susceptible to insecure and unpredictable incomes. This leads to women pursuing fragmented and disintegrated jobs as an answer to socially constructed expectations that they are the primary caregivers for children.

In addition, poorer returns from feminised employment restrict the transition from employment to self-employment when amassing entrepreneurial resources necessary for business creation – such as reliability, finance and human capital. A long-term negative affect that women face via working in low-paid jobs is the lack of human capital, if and when they do wish to develop their own business. Restricted roles and low-value-added sectors do not supply enough of a network for females to benefit from, as a result constraining their ability to progress a venture of their own. “Human capital increases owners’ capabilities of discovering and exploiting business opportunities. Human capital helps owners to acquire other utilitarian resources such as financial and physical capital, and it assists in the accumulation of new knowledge and skills”.

In order to overcome this matter, women need to be encouraged to begin their ventures within the higher performing and high-yielding sectors, for example technology and science. Evidence has illustrated that “banks and equity funders are less attracted to businesses that are run by individuals with a lower level of business experience” , which many females lack due to subordinate work experience.

Regarding the experience and challenges of female entrepreneurs, another hurdle that females have to face are the inadequate levels of financial capital. In any entrepreneurial situation, “the availability of finance and access to that finance is a critical element to the start-up and consequent performance of any enterprise” . Carter and Kolvereid led a study of Norwegian and Northern American women entering entrepreneurship and found that women had greater limitations upon access to personal savings when compared to their male counterparts. New female led businesses are perceived to be risky ventures by banks and venture capitalists. This leads to banks being more cautious when it comes to the distribution of financial capital to women and therefore are more inclined to also charge higher interest rates. This in turn is a factor that negatively impacts upon business subsistence, execution and growth. Reports in the past have shown that countless self-employed women have felt the pressures of gender discrimination in the course of obtaining funding. The undeserved pressure that they endure can drastically impact their choice of relying on angel investors or family/friends.

On the other hand, females may feel more relaxed and at ease by borrowing money from family members as they will not have the strict deadlines of repayments for loans if they do not have the financial capital available. Nonetheless education is needed as Gupata states that resource providers tend to make decisions based on incomplete information and under uncertainty, thus are vulnerable to the social norm and influence of stereotypes. If this continues, male resource providers will never change their viewpoints and will continue to discriminate against women. This fits with the theory that many of the individuals, such as venture capitalists and bankers, are “more likely to provide resources when the individual fits the stereotype of an entrepreneur” (Gupta et al., 2005). As a result of this women are therefore more likely to open their ventures in sectors with a high female concentration as they feel restricted with the choices of business that they go into. But this comes at a cost as the divisions that are highly concentrated with women “are considered to be less profitable” to financiers who would rather invest in a business idea that yields higher profits for stakeholders.

The fight in order to achieve gender equality, despite all efforts, still seems to be ongoing in the business world. From an entrepreneurship perspective, society’s perception of gender stereotype, lack of financial capital and family life can be, as explained, hindrances for females who wish to pursue their career and gain independence. More work needs to be done to give women an equal right to acquire capital. Nascent female entrepreneurs need support from venture capitalists, bankers and suppliers in order to grow and develop their emerging businesses. However, as explained previously the majority of these resource providers are males, who either subconsciously or consciously gender discriminate as they believe that ‘many female-owned firms are marginal and vulnerable; few are innovative entrepreneurial enterprises with the potential to create new wealth or act as net employment generators’. Therefore, the need for education and educators have never been more important and are needed to reduce these pigeonholes among men.

Nonetheless recent propositions and developments have been made in order to acknowledge the problems that are faced by women. Organisations such as The Diana Project which focuses on the “vital importance of women entrepreneurs for wealth creation, innovation and economic advancement throughout the world” are beginning to slowly shed light on the overshadowed issues that female entrepreneurs face. Due to these recognitions, numerous changes have been made from a financial perspective whereby “a number of funds specifically targeting women entrepreneurs have emerged around the world”.  

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