Women make amazing entrepreneurs -- so why don't more of them start businesses? While half the population is female, only 36 percent of businesses are women-owned, and a much smaller percentage than that are female-led if you're talking about high growth startups.
The answer to this question is complicated, but lack of access to capital (women receive a woefully small share of total investment dollars), a dearth of role models, and possibly cultural stereotypes that limit women's entrepreneurial ambitions probably play a role. But while the overall picture for women entrepreneurs leaves lots of room for improvement, not all locations are created equal when it comes to helping female founders thrive.
Some cities offer more financing for women's entrepreneurial dreams, more established female-owned businesses to mentor up-and-comers, and a generally friendlier business environment to give would-be women business owners a leg up. Finance site Nerdwallet recently set out to discover where these places are, producing a ranking of metro areas that are the most friendly for women entrepreneurs.
Using data from the U.S. Census Bureau and the Small Business Administration, Nerdwallet compared stats such as the number of women-owned businesses per 100 residents, median annual income for women (and how that compares to the median for men), and SBA-guaranteed loans per 100,000 residents. Here's the resultant top ten:
- Boulder, Colorado
- Bridgeport-Stamford-Norwalk, Connecticut
- Denver-Aurora-Lakewood, Colorado
- Santa Cruz-Watsonville, California
- Santa Rosa, California
- San Luis Obispo-Paso Robles-Arroyo Grande, California
- San Francisco-Oakland-Hayward, California
- Minneapolis-St. Paul-Bloomington, Minnesota and Wisconsin
- Portland-South Portland, Maine
- Fort Collins, Colorado
What's one obvious takeaway from this list? As Nerdwallet puts it: "Go West, young woman." California especially comes out looking golden in this ranking (which notably, doesn't take cost of living into account), and only two-out-of-ten cities are in the eastern half of the country.
This jives with an earlier analysis that found women-owned businesses are growing the most quickly in western states, but contrasts sharply with another recent ranking of cities that asked existing young entrepreneurs how business-friendly they found their location. Seven-of-ten cities topping that list were in the east. Though both of these city-based analyses agree on one thing at least -- Boulder is apparently awesome for business owners. It made the top three of both rankings.
The possible conclusion from the vast differences in these lists is that while it's valuable to consider larger factors like a city or state's tax and regulatory regime and the area's supply of potential employees when starting a business (and certainly fun to compare cities' business friendliness), the truth is that the decision of where to locate is often down to the idiosyncrasies of the individual business (the location of customers and suppliers, for instance) and personal factors. Some data even suggests the best place in the world to start a business may just be your hometown, as the longer a founder has been resident in a place, the higher his chance of success.