Jul 22, 2018

How Much Are Female Founders Paying Themselves?

While the gender pay gap has narrowed over the last half century, it may come as a surprise to many that female founders have been paying themselves far less than male founders do. On average, women entrepreneurs pay themselves 30% less than male peers. Even when women are their own bosses and write the paycheck, they still can’t escape the inequality. And this begs the question: what in the world is going on?

“Across the board there’s a tendency for female entrepreneurs to pay themselves last. Any extra revenue is generally used to pay employees, bring on new hires, or reinvest in the company,” said Julie Weeks, President and CEO at Womenable.

Although males and females may be working equally hard, men tend to place greater value on their work and hours spent, justifying the additional money they reward themselves with. Women, on the other hand, take a more delayed gratification approach.

But even this theory looks bleak when entrepreneur behavior is looked at. The percentage of women who admit to providing extra unpaid services to their customers is 87% compared to just 79% of men. Even when women are in a better financial position, they tend to put their customers and the business before their own income.

But recent research shows this trend may be changing. The Business Outlook Survey found women are planning on giving themselves a raise in 2019. More than 5% of respondents plan on an increase of 20% or more, while 40% predict a 1–20% pay raise.

Weeks believes we’ll continue to see a narrowing of the entrepreneurship pay gap. “It’s definitely lessening over time…so that’s a positive trend. But as a women’s business advocate I would like to see that gap get much slimmer…and much more quickly.”

What female founders do now has the potential to impact not only themselves but the entire economy. When these women start paying themselves more, they’ll send a message to investors, partners, employees, and women around the world—themselves included—of what they’re really worth.

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About the author

Jesse Sumrak
Jesse Sumrak is a Social Media Manager for SendGrid, a leading digital communication platform. He's created and managed content for startups, growth-stage companies, and publicly-traded businesses. Jesse has spent almost a decade writing about small business and entrepreneurship topics, having built and sold his own post-apocalyptic fitness bootstrapped startup. When he's not dabbling in digital marketing, you'll find him ultrarunning in the Rocky Mountains of Colorado. Jesse studied Public Relations at Brigham Young University.

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