Female entrepreneur discussing plans with her team

Your Guide to Crushing It as a Female Entrepreneur

10+ min read • Oct 29, 2020 • Grant Olsen

Did you know that we’re living in the golden age of female entrepreneurship? Women are taking the business world by storm in multiple ways. Consider these super-impressive stats:

  • Women-owned businesses comprise 42% of all businesses
  • These businesses generate nearly $2 trillion in annual revenue
  • The total revenue of these businesses has increased 21% over the past 5 years
  • The overall number of women-owned businesses increased 21% over the past 5 years (while businesses as a whole increased just 9%)

Yes, there’s a lot of positive momentum right now. Research shows that 13 million or so women are currently considering making the jump from the corporate world into entrepreneurship.

“In the past 20 years, the growth rate for women-owned businesses has dwarfed the national average—increasing by a staggering 141% compared to 44% for all businesses,” says Forbes. “Determining how these companies perform compared to those run by men is a nuanced undertaking, but recent research suggests women entrepreneurs are just as successful as their male counterparts.”

But when you dig deeper into the data, you realize that it’s not just superb talent and great ideas that are compelling these women to leave the corporate world. There are also some pervasively negative factors in the mix. Those most commonly cited by women include a glass ceiling on opportunities, pay disparities, and discrimination experienced in the workplace.

These issues are illustrated in jarring fashion by the fact that there’s a higher number of Fortune 500 chief executives named James than the total number of women chief executives on that list. If you set the Fortune 500 list aside and consider all the businesses operating in our nation’s top 50 cities, only 30% are women-led.

Women who start their own businesses cite 3 key reasons for doing so, and they correlate perfectly with the negative factors listed above:

  • 70% feel that their potential for career growth will be better
  • 58% feel that workplace discrimination will be less likely
  • 54% feel that they’ll be less impacted by a gender pay gap

So how does it work out for most of these entrepreneurial women? Over 90% report that they’re proud to be a small business owner. Nearly that same number report that they’re happy with their jobs, and 83% report high satisfaction with their career choices. Contrasting those stats with the overall American workforce highlights just how remarkable they really are: just 51% of the overall workforce is satisfied in their jobs. Ouch.

The Undeniable Impact of Networking

There are plenty of lessons to be learned from the classic 1939 film The Wizard of Oz. For one thing, we learn that water causes witches to melt. There’s also a potent reminder that you should always make sure to have your pet with you before boarding a hot-air balloon.

Perhaps most important of all, however, is the power of working together. The Tin Man, Scarecrow, and Cowardly Lion were lost and incapable on their own. But when a strong woman entered the picture, the trio was suddenly able to leverage their strengths and accomplish things that would’ve seemed impossible before Dorothy’s house came spiraling out of the sky.

This focus on teamwork is absolutely true for women in business. You’re always stronger when you work together.

“Most businesswomen are familiar with the term ‘old boy’s club,’ an exclusive network of businessmen who can call in a favor from their exclusive group to help close a deal, get new business or progress in their career,” says communications expert Catriona Pollard. “There is no reason why women can’t do the same. And in fact, that is what most businesswomen networks are doing. Networking with women assists the exchange of ideas, the ignition of trade through the development of strategic business contacts along with enhancing entrepreneurial skills for business success. It’s a very clever career strategy to join networking groups that can further your career or connect with the right business people.”

There’s never been a better time to be a woman looking to network with other women in business. Remember, millions of women are taking the plunge to become business owners. Vibrant networking opportunities are constantly popping up around the world.

For example, Facebook is helping women do great things with its #SheMeansBusiness program. Using their suite of tools, you can connect with female entrepreneurs in more than 20 countries to swap advice, pitch ideas, and offer assistance.

Another powerful example is the S.H.E. Summit, which brings women together for motivational and educational training. 

“We want to make it easier for women who have an idea or a business that has really been sitting on their heart, have been wrestling with for a long time, to have the courage to make the leap,” explains Kathleen Griffith, one of the event’s founders. “Over time, I’d love to have a list where women openly declare that they’re going to launch this idea or business or whatever it may be, and we all support them and hold them accountable to that.”

As more women help other women, the sisterhood will only provide more opportunities. Here’s a list of some networking opportunities you might want to check out:

Solving the Financing Puzzle

Team looking at finances together

It takes money to start a business, and it unfortunately often takes more effort for women to secure that money. If you look at the $130 billion paid out in venture capital in 2018, businesses owned by women only accessed 2.2% of the pie.

Sadly, more recent research reveals that those statistics remained fairly static in 2019. It’s indefensibly tough for a woman to secure VC funding. How about debt funding? Lendio conducted a study to answer that very question. Our research suggested that fewer than 1/4 of the businesses that qualify for loans are women-owned.

“An HSBC survey of 1,200 entrepreneurs, mostly women, from around the world, found that 1/3 reported gender bias when trying to raise capital,” reports Lendio CEO Brock Blake in an article for Forbes. “It was worse in the West, where 46% of American entrepreneurs said they experienced gender bias and 54% of UK women reported bias. Women said that investors asked them more invasive questions centered around their personal lives, rather than about their business idea. HSBC reported that overall, women typically secured less money than their male counterparts.”

Given the unfairly stacked deck, it’s essential for every female entrepreneur to understand the best and most reliable sources of funding. Let’s start with venture capital. Despite the bad press and dismal statistics, there are VCs committed to supporting women on the road to success.

Here are some notable examples:

  • Fika Ventures: Eva Ho and TX Zhuo lead this California-based seed fund. If your business involves automation, data, or AI technology, they’ll be particularly interested in chatting with you.
  • Urban Innovation Fund: As the name implies, this firm offers seed capital to entrepreneurs who will improve cities with their ideas. Sector examples include housing, education, transportation, and recreation.
  • SoGal Ventures: Led by Elizabeth Galbut and Pocket Sun, SoGal Ventures has an international presence and often invests in innovative technologies that solve problems.
  • 500 Startups: If your business is in the retail, fashion, or beauty industries, you should consider 500 Startups. This global VC firm is dedicated to investing in businesses led by women and other historically marginalized individuals.
  • Glasswing Ventures: Aside from having an absolutely gorgeous name, Rudina Seseri’s firm is always on the lookout for startups with great AI solutions.
  • Halogen Ventures: This early-stage VC fund invests in consumer technologies that push the limits of what’s possible. They’re known for giving ample support and development resources to the businesses they fund.

There’s also a wide array of loans available to female entrepreneurs. Each loan type has unique strengths and limitations. For example, some loans deliver ultra-fast cash to your bank account but charge higher fees. Others have maximum amounts reaching $5 million, but they require more paperwork in the application process.

Let’s take a look at some of the best financing options available for women business owners:

Business Line of Credit: If you’re new to the business loan world, a business line of credit can be a user-friendly way to learn the ropes. This type of financing is structured much like a credit card, so rather than getting a lump sum of money, you’ll have unlimited access to a revolving pool of money. Of course, you’ll only pay interest on the money you choose to use.

With a business line of credit, you can qualify for as much as $500,000. Plan on rates ranging from 8–24%. You should also know that it takes up to 2 weeks for the money to reach your bank account.

While some loans have strict rules for usage, you can use the money for nearly any purpose related to your business. For example, you could pay invoices, purchase vehicles, boost your inventory, increase your staff, or repair equipment.

The qualification process for business lines of credit is extremely user-friendly. There isn’t a lot of paperwork required, and you’ll have a good chance of approval as long as your business has been operational for 6 months or more and makes at least $50,000 per year. Your credit score must also exceed 559.

Business Credit Card: If you think a business line of credit is easy to use, it has nothing on a business credit card. Set up nearly identically to the personal cards you’ve probably had for years, these cards enable you to borrow as much $500,000 for your small business. The biggest advantage with this route: they’re so easy to use and pay off.

Business credit cards usually have interest rates between 8 and 24%, though if you take the time to look for promotional offers, you can often find a 0% introductory rate. Speaking of promotions, you can also earn rewards like travel miles or cash back for your usage of a business credit card. Your card’s funds are easily accessible, and they can be used for as wide of a range of purposes as a business line of credit. Basically, if your business needs it, you can pay for it.

Qualifying for a business credit card is fairly easy. This means they’re perfect for those who are new to business or have been rejected for other loans. If your credit score is 680 or above and your business has been around long enough to establish a solid track record, you’ll be in a prime position for approval.

SBA Loan: The Small Business Administration (SBA) is dedicated to supporting small business owners. In particular, they focus their efforts on helping those who traditionally face discrimination in pursuit of financing.

Three of the most popular loans provided by the administration are SBA 7(a) Loans, SBA 504 Loans, and SBA Express Loans. These loans range in size from $50,000 to $5,000,000. The money doesn’t come directly from the SBA—instead, the agency connects you with an outside lender and then guarantees a portion of the money you’re borrowing. This generous incentive makes the lender more willing to work with you.

Given their many benefits, SBA loans are popular with entrepreneurs and can be more difficult to acquire. You should carefully gather all the required application documents, such as tax returns, your profit and loss statement, your balance sheet, and a debt schedule.

Short Term Loan: Sometimes you just have to get cash on a faster-than-usual timeline. This is where a short term loan can really save your bacon. Once you’ve been approved, the money can often reach your business in just 24 hours.

Short term loans usually max out at about $500,000. Given the expediency of this type of funding, the interest rates might be higher than what you’ll see with a lot of other loans. In the best cases, however, you can still find rates as low as 8%.

The best uses for short term loans are those that require rapid responses. So if you’ve had a crucial piece of machinery break, need to hire additional staff during a busy period, or find a new business opportunity you want to jump on, this type of financing can be just the ticket.

Qualifying for a short term loan isn’t particularly difficult. If your business has been operating for a couple of years and your credit is solid, you have a great chance of getting approved. Be aware that some lenders will require you to secure the financing with collateral such as a home, vehicle, or equipment.

Merchant Cash Advance: While most kinds of business loans are approved based on the past performance of your business, a merchant cash advance looks to the future. Basically, you’re allowed to borrow against the future earnings of your business. After you receive the money, you’ll begin repayment through a percentage of your daily credit card deposits.

Merchant cash advances are ultra flexible, allowing you to use the money for all manner of business expenses. Need to boost your inventory in anticipation of a big shopping weekend? Want to add an epic saltwater fish tank to your office? Planning to purchase a new vehicle for your fleet? All these expenses and more would be valid.

Another benefit of this kind of financing is the funding speed. Get approved on a Monday and you could have the money by Tuesday. The downside: merchant cash advances can be more expensive than other types of financing, with interest rates of 18% or higher.

Because this financing is based on future performance, there isn’t much paperwork involved in the application process. And you won’t need to worry about providing collateral. Often, lenders don’t even pull your credit. As long as you provide 4–6 months’ worth of bank statements or receivables, you should be good to go.

Business Term Loan: While merchant cash advances are based on futuristic profits and short term loans deliver blazing-fast money, business term loans just chug along with the same boring structure they’ve had for decades. These loans are far from sexy, but they’re incredibly popular due to their reliability and versatility.

Business term loans can be as small as $5,000 or as large as $2,000,000. The money usually hits your account in just 48 hours, and you can use the funds for a wide array of business needs. Interest rates on these loans are usually borrower-friendly, starting as low as 6%.

Equipment Financing: These loans are designed precisely to help you purchase the equipment your small business needs. Common examples include vehicles, forklifts, ovens, refrigerators, fryers, conveyor belts, and trailers. But the umbrella of “equipment” also encompasses things like computers, printers, software, and payment processing solutions.

You can get your money in just a couple of days with equipment financing, and the interest rates start around 7.5%. The loan’s term typically falls between 1 and 5 years.

To qualify for equipment financing, you’ll need to have been in business for 12 months or longer. If you bring in at least $50,000 a year and have a credit score above 650, you stand a great chance of getting approved. The equipment you purchase with the financing will serve as your collateral, which eliminates the need for a down payment or other collateral.

Accounts Receivable Financing: If you have unpaid invoices piling up and need some quick cash, this can be a convenient form of financing. By selling your purchase orders and receivables, you can get as much as 80% of their value. The funds usually only take a few days to hit your account, with factor rates starting at 5%.

The chief advantage of accounts receivable financing: it removes the burden of needing to track down those who owe your business money. The lender will handle all the grunt work while you get access to fast financing.

This is a great form of financing for those who have credit issues preventing them from qualifying for other loans. Lenders won’t care much about your business’s financial picture, as they will make their money from the businesses that owe you money. This means your credit isn’t a crucial aspect of the application, and you won’t need to provide any collateral.

Additional Sources of Financial Support

Team of professionals discussing financials

While loans can be a powerful way to fund your entrepreneurial dreams, it’s always nice to have a couple of aces up your sleeve. For this reason, you should consider the full range of funding options available to your small business.

One of the most appealing forms of financial support is a business grant. The reason for their popularity is clear: you never need to repay the money. Given the competition for this free money, it can be difficult to land a grant for your business. But that doesn’t mean you shouldn’t try.

Start with the Small Businesses Association’s Office of Women’s Business Ownership. It provides information on a host of financial resources that can help you prepare for the next stage in your small business journey.

Next, pay a visit to Grants.gov. This is the hub for all federal grants, and you can search it for funding you might qualify for. The majority of federal grants are earmarked for purposes outside the scope of most small businesses, but there are plenty of options that might be relevant if your business lines up with the technology- or economy-boosting missions of various government agencies.

Beyond the realm of federal grants, there are still plenty of interesting possibilities. Check out the grants below to see if any of them apply to your business:

Another funding route to consider is microloans, which share a lot of similarities with the loan products listed in the prior section but are much smaller and easier to qualify for.

One of the most well-known sources for microloans is Kiva. They have helped millions of individuals connect with funding, and 80% of those borrowers have been women.

For years, Kiva was known primarily for its work on the international stage. But they’ve expanded their domestic operations, allowing American entrepreneurs to benefit from the organization’s easy application and excellent funding opportunities.

Another top source for microloans is Opportunity Fund. These loans top out at about $30,000 and can be used for a wide range of business purposes. Opportunity Fund has distributed hundreds of millions of dollars’ worth of microloans over the years, and the businesses on the receiving end have a stunningly high survival rate of 90%.

Finally, you’ll also want to look at the microloans from Accion. This nonprofit provides loans to disadvantaged borrowers around the world. The maximum amount is $50,000 and the terms can be quite generous.

The Best Cities to Host Your Business

Businesswoman in the city

As you might expect, there are certain parts of the country where people tend to be more supportive and friendly when it comes to female entrepreneurs. By examining factors such as income earned by female entrepreneurs, business earnings for female entrepreneurs versus wage earners, the rate of self-employed women, and the balance of business ownership between men and women, researchers have identified some of the top US cities.

Ready for the roll call? California absolutely dominated the list, with 5 cities landing in the top 10. And the east coast definitely makes its presence known. Here’s the list:

  1. San Francisco, CA
  2. San Jose, CA
  3. Hartford, CT
  4. Nashville, TN
  5. Raleigh, NC
  6. Los Angeles, CA
  7. Seattle, WA
  8. Sacramento, CA
  9. Boston, MA
  10. Riverside, CA

Of course, you shouldn’t consider this list to be the ultimate geography for success. There are undoubtedly women in San Francisco right now dealing with the same gender pay disparities and discrimination that are prevalent nationwide. Rather, this research helps identify areas of the country with positive trends.

Are you curious which cities ranked lowest on the list? Without further ado, here they are:

  • Buffalo, NY
  • Cleveland, OH
  • Indianapolis, IN

If you currently live in one of these top 10 or bottom 3 cities, evaluate your personal experience based on the researchers’ criteria. If you live elsewhere, put your city to the test. Is your city generally supportive of female entrepreneurs? Do you think the area’s gender pay gap is widening or narrowing?

Your personal experiences are likely tied to the industry you work in. The smallest pay disparities are usually found in industries such as insurance, food services, real estate, finance, and accommodations. You’ll find more troubling disparities in industries like management, information, and utilities.

Whether you’re a realtor in San Jose or you work in management in Cleveland, you have the power to make things better around you. Your career will encounter headwinds because women have always faced gender-based discrimination. So tap into the power that comes from being unapologetically you. Don’t feel like you have to act more like your male counterparts to succeed in business.

“Starting out I felt so hungry to find my ‘purpose’ […],” recalls legendary entrepreneur Kathleen Griffith. “So, I turned to a quote from Diane von Furstenberg: ‘I didn’t know what I wanted to do, but I always knew the woman I wanted to be.’ That I could envision, and that brought comfort. Many years later, life winked at me and I got to have a business meeting with this woman whose quote I had stared at for so long.  Looming behind a 20-foot desk (while I sat in front of her), surrounded by color, bracelets jangling as she emphasized every point, she taught me an even greater lesson: she showed me a woman who was brutally direct, pointed in her questions and tough—but at the same time, utterly graceful, gushingly complimentary of me and generous […] She taught me as women we can be multifaceted, profound contradictions and that is not only okay—it is fundamentally, absolutely necessary.”

Wherever you live and whatever your industry, this is your chance to make your mark on the world. But you can’t do it alone. Rally together with other strong female entrepreneurs and celebrate each of your victories to come as shared.

In the golden age of female entrepreneurship, things are definitely changing for the better. Modern women have more opportunities and resources available than any previous generation. And each of your accomplishments add to this legacy. This is crucial, because there are future generations of female entrepreneurs waiting in the wings. By doing your best today, you’ll help lay a smoother road for them to follow in the future. In this way, all women benefit from each other’s success.

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Grant Olsen

Grant Olsen is a writer specializing in small business loans, leadership skills, and growth strategies. He is a contributing writer for KSL 5 TV, where his articles have generated more than 6 million page views, and has been featured on FitSmallBusiness.com and ModernHealthcare.com. Grant is also the author of the book "Rhino Trouble." He has a B.A. in English from Brigham Young University.