Women still haven’t reached true equality with men in the business world. This was confirmed when the UK government recently set a target of 25% female representation on the board of FTSE 100 companies by 2015. Although the figure has now reached 20.7%, predictions say that the target may fall short by just 1%.
It is a similar case for small/medium businesses and startups, with fewer women founding or managing businesses than men.
There always has been, and continues to be, a shortage of female-led companies. However, it is becoming clear that change is slowly but surely happening. The number of women being promoted to higher roles, taking on the role of managing director or starting their own business is growing. In fact, Forbes magazine went as far to say that 2014 will be the breakout year for female entrepreneurs.
But the question remains, why is the number of women in business still not equal to men? In order to find solutions and answers, it’s important to look at the obstacles that women face, from balancing work and family, to securing financing and gaining support.
As CEO of Bright Ideas Trust, a charity that helps people start their own businesses and learn essential business skills, I have spoken to many women in senior roles, who express the difficulties in balancing a home life with work and how they feel guilty about missing important family events because of their job. Starting their own business and feeling in control of their own time is a tremendous boost for women to retain their talent and contribute towards the economy.
But lack of confidence in themselves and their business startup can greatly affect their chances of achieving success. Women-led startups generally ‘compensate’ by researching ideas more thoroughly and seek out the support of others as defacto mentors. This tendency can and should be seen as an advantage and make women-led startups more investible.
Through continued support and guidance, a woman’s business can flourish. This can be through mentors and trusted advisers who can offer insight from many different industries. I have always seen huge value from this and it’s why we ensure all our beneficiaries at Bright Ideas Trust are assigned a mentor and are offered business lessons to help them learn and succeed.
Moreover, funding is crucial to many in order to sustain the growth of a business and even small loans can make a big difference. But when it comes to finance, women can face particular hurdles. This can be because of a lack of collateral, to feeling uncomfortable in asking for a large amount of funding, to ingrained gender bias – the nurturer clinging too tightly to the purse strings (unless we are buying shoes!). Add this to the fact it is now extremely difficult to borrow money from the bank, and you can understand why getting the right amount of money a startup may be difficult.
However, acquiring funding is less of a challenge now due the Government backed scheme run by The Start Up Loans Company, delivered by many, including us. We can fund many startups, no matter the product or service they sell. This scheme has made applying and receiving funding less difficult for entrepreneurs, and in turn we are seeing an influx in successful startups, run equally by men and women. We can already see this at Bright Ideas Trust, with 45% of the startups being women.
The correlation between the rise in charities and organisations that support people who want to start their own businesses, and the rise in women-led businesses, is no coincidence. Yes, more progress still needs to be made to encourage more women to conquer their inhibitions and follow their dreams in the business world but the future looks bright for women entrepreneurs.
Women’s empowerment will be front and centre in 2014 as more companies, communities and countries invest in female entrepreneurship. And I’m convinced that startups that are run by women, will in turn lead to a rise in number of investments in other companies led by women. Moreover, female business leaders will inspire others, make flexible working the norm, not lose senior talent at board level and encourage more to pursue their dreams and start their own companies.
Lisa Gagliani is CEO of Bright Ideas Trust, a charity that helps young people in London who aren’t in employment, education or training or who haven’t had the same chances as the rest of society to start their own companies and learn business skills that will stay with them for life. It helps by providing funding as well as advice and support from its team of dedicated business mentors and expert advisors. Since January 2013, Bright Ideas Trust has been delivery partners for The Start Up Loans Company. To date, Bright Ideas Trust has helped over 120 new startups achieve funding worth £500,000 and expert mentoring from the commercial world. Follow Bright Ideas Trust on Twitter and Facebook.