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Women Investing in Women in More than One Way

Time and time again we have been told that access to capital, one of the Council’s four pillars, is the most pressing issue facing women entrepreneurs and small business-owners in America. Include a note on how it’s one of our pillars? Our Fact Sheets cite it[1], scholars support it, and journalists harp on it.[2] But there is more than one arena in which women entrepreneurs need our investment. As part of my research project with the National Women’s Business Council this summer, I sought to explore the ways in which women can invest in women— aside from money. My findings featured eight incredible women who do so on a daily basis, and here I will highlight a few of their key observations. State tuned for a full report to come soon!

Organizations such as Corewoman generate impact in the arena of Education by empowering women with skills needed to succeed in their respective industries. Diana Franco, partner and organizer at Corewoman, is a notable leader in entrepreneurial education, and is a woman who invests in other women. Corewoman is a non-profit that runs training programs for women entrepreneurs, specifically targeting the Latina community. In an interview, Franco stressed the importance of helping to develop soft skills for women entering the workplace. She further noted an issue in the education and training arena that few recognize: “Even though women want to help other women, it is difficult for most women to have female bosses. There is a lack of trust. Historically women haven’t been collaborative between each other; this is changing now, during new generations.” Educators and mentors must nurture close relationships with women to empower them and help them reach their potential.  

There is an additional hurdle in the face women-owned businesses: a lack of data to support Direct Patronage. Founder and entrepreneur Stella Sacdalan recognizes that there has recently been more awareness around investing in women, but she finds it difficult to do so without a user-friendly and comprehensive database of all the women-owned businesses around her and in the nation. To fill this gap, Sacdalan founded Equallet, a “Yelp for women-owned businesses,” in October of 2015. The mission of Equallet is simple. Women-owned businesses are on the rise, and women are the majority purchasers in the United States, “by highlighting women-owned businesses, [Equallet] gives you that choice to make a conscious decision about the products and services you buy.” [3] In the same vein, in late 2014 Walmart instituted WBENC-certified “women-owned” logos to many of its merchandise items, recognizing products that are owned and operated by at least one woman. [4] More on this in the full report.

Needless to say, access to capital is a primary impediment to success. Despite the rate of female entrepreneurship in the United States being higher than that of men for the past 20 years[5], only 2 percent of women-owned firms in the United States have revenues that exceed $1 million.[6]. Historically, capital is rewarded to those with the most connections or most expansive networks (i.e., white, Protestant men have invested in white, Protestant men for generations) said Erin Bagwell. Bagwell is Founder and co-producer of the activist film Dream, Girl film, which showcases stories of successful women in the entrepreneurial and investing ecosystems. The flawed paradigm working against minorities and women seeking capital needs to be shifted, as Erin noted.  We have heard from leaders like Sallie Krawcheck, Chair of the PaxEllevate Global Women’s Index Fund at the United State of Women Summit in June, and Founder of Plum Alley Investments, Deborah Jackson at Public Meetings. These women exemplify the best way to expose women business-owners and aspiring entrepreneurs to capital -- by women investing in women, thereby bringing women in the upper echelons of business and venture capitalist firms. “It’s a virtuous circle.” Erin Bagwell told us.

This translates equally to other disadvantages that women-owned businesses face. Women can and should invest in women in more ways than opening their checkbooks! Successful women entrepreneurs should not only pay it forward by investment in aspiring women entrepreneurs, they should educate and mentor them; technologically savvy women should optimize their talents to push limits, and women who are passionate about storytelling should call others to action.

 

Author: Kamya Arora is currently a Summer 2016 Research Fellow at the National Women’s Business Council, and is a rising junior at Barnard College of Columbia University.

[1] Access to Capital by High-Growth Women-Owned Businesses SBAHQ-13-Q-0A63 (n.d.): n. pag. National Women's Business Council. Web.

[2] "Is Change In The Wind For Women Entrepreneurs Raising Capital?" Forbes. Forbes Magazine, n.d. Web. 03 Aug. 2016.

[3] "Equallet | Achieving Equality with Our Wallets." Equallet | Achieving Equality with Our Wallets. N.p., n.d. Web. 04 Aug. 2016.

[4] "Home." Women Owned. WBENC, n.d. Web. 09 Aug. 2016.

[5] "Is Change In The Wind For Women Entrepreneurs Raising Capital?" Forbes. Forbes Magazine, n.d. Web. 03 Aug. 2016.

[6] Access to Capital by High-Growth Women-Owned Businesses SBAHQ-13-Q-0A63 (n.d.): n. pag. National Women's Business Council. Web.

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