Entrepreneurship is the process of doing business. It’s creating a business and making sure it is successful. It’s taking a great idea and turning it into a successful business.
In some countries, women start and run their businesses. In others, they may only be a small fraction of the total ownership. In some, women are only allowed to own a certain amount of a business. Others still allow women to hold all of it.
According to the World Bank, only 12% of the world’s entrepreneurs are women, even though they make up 50% of its working population. The gender gap in entrepreneurship is even more significant in developing countries, where only 4.5% of women are self-employed compared to 15.9% of men.
Men and women have different motivations for becoming entrepreneurs. Women’s number one preparatory activity is specific training (61.7% versus 54.2%). Their creation of activity is less opportunistic since only 20.1% of them declare to have identified an opportunity on the market (against 32.7% for men).
The differences between male and female entrepreneurship
The reasons for the gender gap in entrepreneurship are numerous. The most important is that women are less likely to be engaged in education and training. They are also less likely to access training, mentors, finance, and business networks.
Regarding women’s entrepreneurship in developing countries, we know that women make up 50% of the world’s workforce. However, the percentage of self-employed women in developing countries is much lower than women in developed countries.
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In the US, women create 30% of all new firms and are more likely to start new businesses if they are married, have children, are in their early 30s, have a household income of more than $100,000, and have a college education.
Men and women have different motivations to become entrepreneurs
Men are more than likely to start a business because they desire to work for themselves and be their boss.
The most important reason for women to become entrepreneurs is the chance to work outside the house. Men’s motivation is to earn money for their families.
The World Bank reports that women’s number one preparatory activity is specific training (61.7% versus 54.2%). Their activity creation is less opportunistic since only 20.1% of them declare to have identified an opportunity on the market (against 32.7% for men).
In developing countries, men are more likely to start a business if they are married, have children, are in their early 30s, have a household income of more than $100,000, and have a college education.
Support: a structural weakness regardless of gender
The lack of support concerns both sexes. The majority of men and women are not accompanied in creating their business.
Men and women face different challenges when it comes to supporting. In particular, women are less likely to receive support from their social network, receive financial aid, and receive more training.
Only 25.5% of women and 37.5% of men have a partner who helps them start the business. The difference in self-employment rates between men and women in developing countries is more than twice as high as the difference between self-employment rates in developed countries: 15.9% versus 4.5%.
The most important difference between male and female entrepreneurship is the role of the family. Family ties are essential for men, whereas women are more likely to take their first step in entrepreneurship when they are single.
Support is the number one reason women entrepreneurs give up their new businesses.
Women are more likely to train than men
While women are less likely to start a business, they do more preparatory activities than men.
Women often consider training part of their job rather than an additional activity. Therefore they make a more significant effort to acquire new skills than men.
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They are less likely to receive specific training because they are less likely to apply for it (20.1% versus 32.7%).
Male entrepreneurs seek investors much more often than women
In many countries, men are more likely to seek investors and are more likely to receive funding.
Men are more likely to apply to banks for loans (59.8% versus 42.1%) and seek investors (54.7% versus 46.1%). They often make a pitch to a stranger, usually, a friend, who may or may not want to invest in their company.
Female entrepreneurs and their advocates say some women want to finance but can’t readily get it because of discrimination by banks and venture capitalists.
Women who start their businesses are, on average, less experienced than men
Women entrepreneurs are less likely to have had an apprenticeship than men (5.3% versus 12.6%).
Women entrepreneurs are less likely to have professional experience (21.5% versus 61.1%). They are also less likely to have a college degree (12.5% versus 30.4%).
Women entrepreneurs are, on average, less experienced than men. They have an average of 6 years less business experience.
Women start their own business only after they have already been working for eight years (average of men: 10.5 years).
Women feel less “entrepreneurial” than men
This feeling is a significant obstacle for women. Men are twice as likely to identify themselves as entrepreneurs than women.
In many cases, women entrepreneurs feel that the business is not in line with their gender.
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Women are less likely to see entrepreneurship as a career option and feel less comfortable in the male-dominated environment of the workplace. They have less confidence in their ability to succeed.
Female owners are more likely to have positive revenues
While male entrepreneurs have a higher chance of losing money, women are less likely to lose money (2.5% versus 12.3%).
Women entrepreneurs are, on average, more successful than men. This is not a surprise since women entrepreneurs are usually more successful than men.
Women’s businesses are more likely to have positive revenues (55.9% versus 46.1%). The same goes for companies run by women entrepreneurs with no male partners.
To ensure a positive revenue, women entrepreneurs are, on average, more likely to engage in sales (41.7% versus 33.3%), advertising (16.7% versus 8.3%), and marketing (21.7% versus 7.3%) than men.
So which gender makes the best entrepreneur?
The study says it’s men. But it’s not the whole truth.
This study doesn’t say that women make bad entrepreneurs. If we see in the long run, women entrepreneurs sure have a solid chance of overcoming men in this field too.