Five steps to succeed as a woman entrepreneur

On International Women's Day, IOE and its network team up to advance gender equality and diversity.

By María Paz Anzorreguy (Director of ILO Coordination), Akustina Morni (Senior Advisor) and Jason Pegat-Toquet (Junior Advisor).

With over an estimated 250 million women entrepreneurs in 2021, you might think there is no longer a gender gap in business ownership. Unfortunately, the gap remains wide, particularly in low-income countries.

Too many women entrepreneurs today are still struggling to overcome challenges their male counterparts rarely encounter, such as gender bias, stereotypes, and discrimination. Yet despite the obstacles, the good news is that more and more women are opening their own business and overcoming the barriers to success. According to the 2021 Report of the Global Entrepreneurship Monitor, "there is a slow shift in the narrative about women's entrepreneurship globally from encouraging a high number of start-ups to higher-growth activities."

What are the main obstacles?

Institutional factors such as the lack of women's financial inclusion, the gender gap in education and the legal rights disparities remain the key barriers women face when starting a business. Perhaps the most significant hurdle women entrepreneurs face in most, if not all countries, is their unequal access to finance. Despite women entrepreneurs being ready and able to receive funding of all types, companies (co)-founded by women receive less than half the investment capital as male-founded companies on average. Equally, according to data from the G20 and the World Bank, although significant progress has been achieved, there is a persistent gender gap in access to basic accounts in the financial system, where nearly a billion women are unbanked.

In addition to institutional factors, socio-cultural impediments such as social expectations, lack of business networking opportunities, skills gaps, and personal and professional life imbalance play an essential role in preventing women from launching their own businesses.

Why is women's entrepreneurship vital?

Entrepreneurship is an essential driver of societal health and wealth and an engine for economic growth. Combining an entrepreneurial spirit with a women's potential to succeed spurs innovation, promotes productivity, creates employment, and addresses some of society's most significant challenges, such as the UN Sustainable Development Goals or the economic shock wave created by the COVID-19 pandemic.

The benefits of promoting women's entrepreneurship are immense. In terms of resilience, examples show that despite being more deeply impacted by the pandemic, many women entrepreneurs have successfully adapted to the disruptions and new market realities caused by the Covid-19 pandemic. According to the 2021 Report of the Global Entrepreneurship Monitor, globally, 30.2 percent of women entrepreneurs are expected to hire six or more employees in the next five years compared to 48 percent of male entrepreneurs. Successful female entrepreneurs can also serve as relevant examples and role models to emulate, further encouraging other women to pursue business ventures. Women entrepreneurship is also a catalyst to close the gender divide, as more women enter the global marketplace and establish businesses.

How to address the gender gap in female entrepreneurship?

Women entrepreneurs offered these top pieces of advice to the next generation of young female business owners during the 2022 IOE event to mark International Women's Day.

• Create an enabling environment for sustainable women entrepreneurship". Governments and policymakers must play the leading role in facilitating an appropriate legal and policy environment to foster women's entrepreneurship. This facilitation starts from providing qualitative education, training, and lifelong learning to more robust support for dedicated entrepreneurship training, mentoring, building entrepreneurial networks, improving access to finance and opening procurement markets to women. Efforts to reduce informality must take place in conjunction with government support.

• Trust yourself and do not give up: Patience, endurance, perseverance, resilience, and adaptability are crucial elements women willing to start their own business must self-develop and nurture throughout their entrepreneurial journey. Women deserve to win, and this conviction is the driving force for success.

• Observe, listen and find a mentor: In the face of difficulties, all panelists agreed on the crucial role of mentors, be they family relatives, friends, employer organisations and others, to provide the extra push or motivation needed to succeed.

• Leverage digital tools and technology: In the digital age, resorting to the benefits technology can bring to women entrepreneurs such as information-sharing, avenues of funding, new markets' outreach or even innovation's support is key to growing and thriving.

• Employer organisations as bridge builders: By using their extensive network and convening power,employer organisations can play an instrumental role in promoting diversity and women's entrepreneurship and empowerment through programs, networks, peer learning and dedicated events.

Check out the new IOE-Deloitte-EU Mentorship Programme, which supports women throughout our global network in their professional development. Mentoring sessions will take place online. If you are interested in participating, please apply by 11 March.

Read our latest publication Women's Empowerment: a driving force for economic recovery and beyond and visit our Gender Equality and Diversity page to know more about IOE's work in the field!