The Entrepreneurial Spirit: Keep Feeding It!

The New Year is just around the corner, and if you’ve had a business idea brewing, consider making 2017 the year you take it to the next level and explore entrepreneurship.

In my coaching practice, and during the course of my travels, I talk to lots of women interested in starting their own businesses. They are passionate about sharing their ideas, and I find it truly heartening to be their sounding board – the more women throwing their hats into the entrepreneurial ring, the better!

Many of the women I speak with are interested in the success rates of women-owned businesses. In 2014, the Senate Committee on Small Business and Entrepreneurship published a comprehensive report on the progress female entrepreneurs had made since the early ‘70s. The study found that, despite persistent barriers, strides had been made:

• Women-owned businesses rose from 4.6% of companies in 1972 to 29% of all firms in 2007
• Revenue generated by women-owned firms rose from just 0.3% of all receipts in 1972 to 3.9% in 2007
• Growth of women-owned firms outpaced that of all other firm types – with women-owned firms adding 500,000 jobs between 1997 and 2007 – while the rest of privately held firms lost jobs
• Between 2002 and 2007, the growth rate of women-owned firms rose by 20%

While the nascent female entrepreneurs I speak with are filled with excitement and possibility at the beginning of our conversations, they’re often talking themselves right out of their ambitions by the end – in many cases, due to issues concerning financing.

According to a recent report on women and loan acceptance rates by Fundera, an online loan marketplace (think KAYAK, but for small business loans), women are less confident than men when it comes to pursuing loans for start-ups. The report states that women request roughly $35,000 less than male applicants – ultimately, getting the shorter end of the financing stick.

Fundera found that:

• Only one in four applicants for business financing through Fundera were women
• Only one in four women were approved for small business loans
• Those approved tended to receive less capital with shorter terms, and were more likely to pay a higher interest rate than their male counterparts

Meredith Wood, VP of Content at Fundera, says the biggest issue facing women looking to jump into the entrepreneurial waters, and grow those statistics, is credit worthiness. “The gender wage gap means that women often have lower credit scores than men,” Wood explains, “This can make small business loan approval more challenging for female applicants.”

Guidance Within Reach

Many of the successful female entrepreneurs featured in my book, This Is Not the Career I Ordered, had a “where-there’s-a-will-there’s-a-way” attitude as they navigated the rocky road to financing.  They tapped into a number of resources, getting advice from organizations including: the U.S. Small Business Administration (SBA); the Small Business Development Center (SBDC); and SCORE, a non-profit association offering business mentoring at little or no cost. In addition to getting approved for conventional loans, a number of the women in the book ended up finding paths to financing through SBA microloans; crowd-funding; as well as through assistance from family and friends.

Keep On Keeping On

Ms. Wood urges budding entrepreneurs to “keep at it.” “I never want women to be discouraged because of surveys or statistics,” Wood says. “If your goal is to start a business, take good care of your credit score, get educated, and keep persevering.”

Entrepreneurship is not for the faint of heart. In addition to the inherent risk, it requires a tremendous investment of time, money, and, of course, nose-to-the-grindstone focus. However, if, in your heart of hearts, you know it’s the road for you, I encourage you to follow that road with conviction. As the well-worn adage says: you’ll never know if you never try.