I had an incredibly interesting lunch recently with some San Francisco tech titans. As a group we were asked if the momentum of businesses being launched was on the rise or the decline. The ass umption around the table was that fewer business are being registered at this moment.
When asked why, we discussed everything from access to capital, health care costs making it hard to leave a corporate environment, all the way to lofty (very San Fran) talk that maybe we don't need more businesses registered to innovate. Which I do not agree with.
A new study out today called What Women Business Owners Need to Succeed is the first of a series of impact reports in partnership with the Kauffman Foundation and my company HelloAlice.com, supported by Silicon Valley Bank. The study looked at a cross-section of 10,000 owners to find out specifically what women business owners really need to scale.
Daily news points the business trajectory in both directions right now, which is a bit confusing. What I do know is that we should make decisions on how to help business owners based on data not assumptions or daily news--real data about why and where entrepreneurs succeed or fail. The more we, as a society, know about a business owners, the better we can curate their unique path to start and grow their companies.
More than 1,800 net new women-owned businesses launch every day in the U.S., and that's been the case for a few years now. Plus, 64 percent of those new companies are started by women of color. How do we use data to ensure these businesses that launched are able to scale and grow?
The data collected allows all to see the big picture of what "New Majority" business owners need to succeed, where there are gaps, and where there are opportunities. With these insights, partners are able to improve programming, services, and communication to support these traditionally underrepresented owners.
The "New Majority" entrepreneurs are women, people of color, immigrants, LGBTQ+, people with disabilities, the military community, and those living outside of major start up hubs.
In the study when women owners were asked about their immediate main focus, as a whole, most frequently responded:
- Raise capital and acquire customers were tied for number one.
- Launch a business.
- Create a strategic plan.
We also need to look at cross sections of data. For example: the same question but broken down by ethnicity, the answers shift. Hispanic women said: 1. Strategic plan, 2. Raise capital 3. Launch business. Asian women stated: 1. Raising capital 2. Building a brand 3. Developing a product. Data cut by ethnicity, helps to know exactly which resources and opportunities are right for that individual business owner.
Here are the broad strokes to pay attention to from this report:
1. One side does not fit all. There isn't just one model for supporting business owners. Personalization and consideration of intersectionality are vital in designing and delivering programming to support women entrepreneurs.
2. Increase access. Women business owners are eager for support in marketing-related activities, raising capital, and getting their companies off the ground.
3. Data-driven decisions are where it's at. With better insights into what specific populations of business owners need (even down to the individual level), the ecosystem can do a better job in supporting them. Ultimately, they can give them the tools, knowledge, and connections, they need to succeed with higher revenue, more jobs growth, and longer business life spans.
4. Better programming and events. Great programs for entrepreneurs aren't one-size-fits-all. To support specific business owners, your programs and services should be designed to meet their specific needs, interests and goals.
5. Myth bust. Don't let anyone tell you that there's a pipeline problem for women-led businesses. There are 12.3 million women-owned firms in the U.S. and everyday, more than 1,800 net new women-owned businesses are added to that list. Organizations, investors, and media can use this data to meet entrepreneurs where they are, with what they need.
6. Targeted marketingWomen control nearly two-third of global household spending, and the buying power of people of color and LGBTQ+ consumers is on the rise. Savvy companies and organizations serving business owners will pay attention to the needs and goals of women business owners, in order to fulfill a very sizable market opportunity..
These stats present an opportunity for all organizations that support business owners to examine and revamp how they support the women entrepreneurs in their ecosystem. From how we all talk to women business owners to the events and programming we build, it's critical that everyone has a deep er understanding of the data and how to implement support for the New Majority.