Entrepreneurship is challenging, especially for women. Here are 5 challenges they face and ideas to overcome them.
Entrepreneurs face specific problems, but what does it mean to be a woman and an entrepreneur?
According to Wells Fargo's 2024 Impact of Women-Owned Businesses report, women own 40% of businesses in the US. However, challenges remain.
“It’s incredible to see how women are strengthening the post-COVID economy, but their impact can be even greater with additional support, tailored to the needs of specific demographic segments,” said President and CEO of Women Impacting Public Policy, Angela Dingle.
According to the Wells Fargo report, "making childcare affordable, improving access to capital, and continuing programs tailored to the specific needs of different groups will allow women-owned businesses—especially those owned by women of color—to realize their potential."
Here's a deep dive into some of the biggest challenges female business owners face and a few tips to overcome them successfully.
One of the biggest problems faced by women entrepreneurs is that they are still heavily expected to play a large part in handling a household. And because owning a business means long hours, there is little space left for a successful work-life balance. Working mothers are thus often forced to give less priority to their businesses to focus on their families.
A study by Mastercard found that three in ten female entrepreneurs struggle to maintain a healthy balance between their personal and professional lives. Besides facing the common business challenges any entrepreneur would have to tackle, women have to juggle this role alongside household responsibilities and the ones related to raising a family.
Female veterans in the field suggest setting clear boundaries about where you need your focus. Nicole Snow, owner of Darn Good Yarn, stresses the importance of a support network to reduce and better focus your workload. Doing so left her with enough time to take care of her two-year-old daughter while managing her online retail company.
Each business operates differently, meaning each businesswoman also has unique challenges. Women entrepreneurs can be inspired by their peers' routines, but that doesn't mean that they should strictly follow their day-to-day routines since this one will be according to their situation. The advice is not to beat themselves too hard if they can't do the same as one of their role models.
Resources and organizations like The First Trimester or The Care Gap can be a starting point to help women entrepreneurs improve their work-life balance.
On the other hand, companies can establish in-house policies that benefit working women and help them achieve a work-life balance. Flexible work arrangements can be one solution, as they enable women to tackle their day according to what works best for them.
A constant workload review, more support for working mothers, focus on productivity instead of time at work, and an attractive time off policy are just some of the possible changes companies can implement to face this challenge.
When women are unable to balance their work and personal lives accordingly, they can experience burnout. In fact, burnout is one of the most common challenges faced by women entrepreneurs. Small businesses leave owners and founders with no space to live and breathe outside of work. The result of this can lead to a downturn in productivity and affect one’s health in the long run as well.
The 2024 Women @ Work study from Deloitte found that only 23% of women felt burnout, compared to 28% the previous year. This shouldn't come as a surprise since women are expected to balance their professional tasks with the responsibilities of managing a home.
Many women entrepreneurs thus emphasize the need for self-care, including activities like yoga, functional workouts, and meditation, to supplement their everyday schedules. It's important to include breaks throughout the day to unwind from work life.
Using the right tools to make a workload more manageable can also help. Women entrepreneurs can make the most of automation platforms to eliminate repetitive and time-consuming tasks.
Companies can also play a key role in helping women entrepreneurs avoid burnout. People managers should be able to spot employees who need extra support and help them by alleviating their workload, delegating tasks, breaking down projects, and more.
Workplaces can also set policies that everyone should follow (from interns to C-level executives) establishing clear hours to unplug from work.
While many employees rushed to entrepreneurship in ‘The Great Resignation’ in 2021, plenty realized that corporate skills didn’t prepare them enough to be entrepreneurs. Challenges like these were even more crippling for women who, in a field that was only starting to even out the gender gap, lacked the necessary personal connections and networks.
Support is not only needed in the form of a proper network for women entrepreneurs and mentorship, but also as a personal support system that can aid women with their other responsibilities. Believe it or not, spousal support can play a key role when being an entrepreneur.
A qualitative study in New Zealand found that there's also a gap between the expectations of men and women in this area. While women entrepreneurs usually ask their partners for business advice, men assume that their spouses will simply help them without having to ask them. On the other hand, female entrepreneurs heavily evaluate how their entrepreneurial endeavors may impact their families.
Women entrepreneurs can invest in a business mentor or coach to help them carve a direct path to their new success.
Joining a network or business community can help build connections and find potential mentors or coaches. It can also be a space to share their stories with more women business owners, promote their products or services in the competitive business world, or even get financial support.
The U.S. Small Business Administration (SBA) offers help to women entrepreneurs through training and funding opportunities specifically designed for new businesses. The Office of Women's Business Ownership (OWBO) is the instance in charge of offering counseling, federal contracts, and even access to credit and capital to women-owned businesses.
Gender biases are one of the many challenges faced by women entrepreneurs. Biases can mean that a significant portion of society still considers running a business to be a masculine attribute.
Women entrepreneurs thus often struggle to be taken seriously and earn respect, and can also be viewed to be aggressive when exhibiting traits associated with business acumen. While, for their male counterparts this is an expected trait needed to succeed in the business world.
Society will have an opinion either way, so it's important to rise against gender stereotypes and overcome any negative self-talk. Only then can women entrepreneurs reach their full potential and attract more women into the field.
Challenging gender bias is no easy task, and it requires a collaborative effort between society, companies, and governments. Establishing public policies that promote gender equality is key to ensure that women entrepreneurs get the same opportunities as their male counterparts.
Business leaders can also contribute by establishing mentorship programs specifically aimed at supporting female-led projects within their companies or industries.
Additionally, governments and international institutions play a significant role in finding the solution to this issue. For example, in September 2017, the International Labour Organization (ILO) launched the Equal Pay International Coalition (EPIC) alongside UN Women and the OECD. EPIC supports governments at different levels to promote and reach equal pay for both genders across all countries and industries. The coalition focuses on raising awareness, sharing educational resources, putting in motion programs that have proven to be successful, and more. Currently, they're offering multiple courses designed for policymakers and company managers who are working on empowering women in the workforce.
Addressing prejudice is a major societal challenge, and there is no one-size-fits-all solution. Instead, multiple steps can help pave the way to a business world in which gender stereotypes don't influence investment decisions.
Securing financing is a challenge for all entrepreneurs, but women often face additional hurdles due to prejudice. Only about 2.3% of venture capital funds go to women entrepreneurs, and only 2% of women-owned startups generate $1 million in funding. In comparison, men are 3.5 times more likely to achieve this milestone.
Fortunately, there are alternative ways to secure funding. For example, the Female Founders Fund specifically supports women entrepreneurs seeking seed capital.
Another option is a business marketplace like Boopos, which offers non-dilutive, revenue-based acquisition financing that can be repaid over 1-5 years. This arrangement aligns with your revenue cycle, providing peace of mind as you grow your business.
Despite the challenges, strong community support can pave the way for women to become leaders in business and establish a new norm.
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