Women Owned-Businesses: Canada needs more female entrepreneurs

Published on Wed Jan 30 2013

By: Hadaf Zubi

Of the 2.4 million businesses registered in Canada at the end of 2011, 1.1 million were small businesses, and they employed 48% of Canadians in the private sector. 

Industry Canada’s most recent estimates put the proportion of women-owned small businesses at 17%, which would represent about 187,000 firms. Since 2001 the proportion of Canadian women employed in senior management positions has risen 5%, and the proportion employed in natural and applied sciences has risen 10%.

The proportion in women in the workforce stayed virtually the same, so it is surprising that even though the number of professional women employed in Canada has risen since 2001, the ratio of self-employed women to men has hovered around a 35-65 split. With more and more women working in professional occupations, what are the major obstacles holding them back from starting businesses of their own, and what can be changed? 

The University of Ottawa’s Telfer School of Management’s “Taskforce for Women’s Business Growth” 2011 report discusses some of the challenges faced by women-owned businesses, such as the absence of a national women’s entrepreneurial strategy, a lack of supplier diversity initiatives, and a shortage of commercial lending. The resolution of these issues would enable more women to form small businesses, so what is being done to fix these problems?

Canada lacks a coordinated national women’s economic development strategy. As the Telfer report suggests, “(A) national strategy would support increased funding to existing women-focused small business training programs and program expansion in those regions that do not currently support such programs, including Quebec, Southern Ontario and Northern Canada.”

Although it is the centre of the Canadian economy, the GTA has no women-specific government-sponsored funding program analogous the Government of Canada-sponsored Women’s Enterprise Initiative Loan Program. The Program, funded through Western Economic Diversification Canada, provides loans of up to $150,000, along with advisory services and networking opportunities for women-owned businesses west of Ontario.

Women-owned businesses in the GTA have access to several networking and support groups, though. Organizations like The Toronto Business and Professional Women’s Club, the toronto chapter of the Women’s Entrepreneurs’s Meetup.com group, or the Hamilton Immigrant Women’s Centre all provide training and advisory services for women who want to start or grow their business. The availability of mentorship is essential to the formation of Women-owned businesses. According to recent research by BMO, 83% of potential female entrepreneurs surveyed said having access to mentors would be important if they were to start their own business. 

A second important element to supporting women’s business growth is a focus on leveraging supplier diversity.

In the USA the Small Business Administration has set aside small business funding for Women-owned small businesses (WOSBs) bidding on government contracts that are under $5 million for manufacturing, or under $3 million otherwise. 

In addition to providing loans or loan guarantees, the SBA maintains Women’s Business Centers in major population centers in every state. These funding programs were established to help the US Government fulfill its stated goal of 5% Women-owned procurement. 

WEConnect Canada, an organization that certifies businesses as Women-owned, states that the 5% goal has never been met because of a lack of consequences. But they still think the program is beneficial, and that the Canadian government should “establish procurement targets for SMEs and in particular, women-owned enterprises.“

They go on to suggest that “strategic SME procurement policy is an under-utilized mechanism to enhance supplier diversity and hence, Canadian competitiveness.”

Government procurement targets are essential to encourage supplier diversity on Canadian government contracts, which the Canadian Federation of Independent Business has consistently pointed out are perceived by their members as being opaque, if not outright unfair.

A third element that would clear the path for more Women-owned businesses would be increased access to commercial capital and dedicated financial resources. Although overall loan volume is growing in Canada, much of that growth is occurring in Quebec and Alberta. Ontario loan volumes are declining, especially in the sub-$500,000 space. 

Government sponsored Women-focused lending programs, such as those offered in the USA or other parts of Canada, would certainly alleviate the cash crunch for Women-owned businesses in the GTA.

Leadership Lessons from Young Female Entrepreneurs

Andi Atteberry, founder of blingsting

Image credit: morningcupofstyle.com

 

Watch out world, there is a new breed of entrepreneur.

Millennial female entrepreneurs are disrupting industries, creating innovative products and ultimately, changing the world. The thing that I admire most about my fellow female entrepreneurs is that they are really doing it by their own rules. In the past, women have felt like they have to embody masculine characteristics to be successful. This isn't the case anymore.

Instead, lady entrepreneurs of Gen Y are embracing who they are, and aren't apologizing for it. There are a lot of leadership lessons to be learned from these 20-something-year-old business owners. Here are a few of the most important: 

Humanize your business. The why in business is just as important as the what. Especially with social media, the story and reasoning behind your business decisions are important to not only your customers, but your employees too. The extra explanation creates a culture of loyalty.

"Not being straightforward is a huge mistake," said Andi Atteberry, founder of blingsting. "Any time I have worked for a boss who has been vague about issues that affected me personally, it has created a lot of resentment and instantly jeopardizes trust." 

Embrace your inexperience. Ignorance is bliss. Zoe Barry, founder and CEO of ZappRx, a healthcare startup that gives consumers more control over the prescription process, was able to raise $1 million in funding with no real track record.

"I actually didn't know how hard it was going to be to raise the initial capital, and I went 18 months without salary or any guarantees," she said. "Not realizing the size of the challenge in front of me, I just assumed I could do it. I relied on my intuition and persistence and bet on myself over my track record."

Being new to an industry gives you the advantage of a fresh perspective; you can sometimes see the flaws that others can't because they have been stuck in the status quo for too long. That being said, female Gen Y entrepreneurs usually understand that they don't know it all either. To be successful, they have to ask for help, and bring in experts when needed. 

Be yourself. Being an entrepreneur is hard work; getting a business off the ground is a long, torturous process. You might as well enjoy the journey by having fun and being authentic. It is a lot less work if you start a business that embodies your personality and things that you are passionate about.

Blingsting's line of bedazzled pepper spray is not only sold in more than 250 small boutiques, the products are also sold in larger stores, such as Cabela's, Bass Pro Shops, Ace Hardware, Peninsula Beauty and Bealls. The success of the brand has proven that business shouldn't be so serious.

"We have a product that girls love, we are making good business decisions, and we are getting it out there," blingsting's Atteberry said. "And I personally believe that there is no one better suited to run a sparkly pepper spray company than a petite blonde who uses the words 'seriously' and 'totally' probably way too much."

Try having fun with it! If you don't, chances are you will be a miserable business owner.

Own your success. Women are notorious for not taking ownership of their success. This new generation of entrepreneurs is working hard, and they aren't afraid of their accomplishments.

"Women sometimes feel that they don't deserve success and are apologetic about it," said Sheena Sujan, founder and creative director of her self-titled line of luxury leather handbags with an impressive celebrity following. "Women should never apologize for being successful! We should be confident about our success and not chock it up to luck."

As an entrepreneur, you are your biggest cheerleader, so you must be confident and proud of your success. This attitude will be infectious, and continue to propel you forward.

The author is an Entrepreneur contributor. The opinions expressed are those of the writer.

Rebekah Epstein

Rebekah Epstein is the founder of fifteen media, an agency that works exclusively with PR firms to streamline media relations in a digital era. She specializes in business, lifestyle, fashion and beauty.

Female Entrepreneurs Go Beyond “Cookies and Crafts”

 

In the 1990′s, if you asked most women business owners what their dreams were, they’d say they just want to be able to support themselves and their families. The times have changed. Today, women have bigger dreams and seek to grow their businesses to the maximum level. However, many are still saddled with an outdated perception about their roles in business and contributions to the economy, despite tremendous growth over the past decade.

 

The old perception is that women-led and -owned businesses are micro-enterprises; companies run out of the home with fewer than five employees. But most women outgrew the “cookies and crafts” stereotype a long time ago, and have their sights set on bigger goals. Many have found success in industries like technology, mining, and construction.

Progressive thinking is being pushed forward by new data that showcases the undeniable impact of women-led and -owned businesses on the economy. Consider these datapoints:

• American Express OPEN’s latest Growing Under the Radar report details just how strong these businesses have been over the past decade. Perhaps the most surprising data is that women-led and -owned businesses experienced 57% growth in revenue of $10 million or above. That is actually a growth rate of 47% more than their male counterparts. This data is even more impressive in the context of a down economy: women-led and -owned businesses continued to grow throughout the recession, as companies around the world had to tighten their belts to weather the storm. The same report indicates that health care, social assistance, and education are industries in which the growth of women’s ownership has been the strongest.
• The membership of the Women Presidents’ Organization (WPO), a nonprofit peer-advisory group for women with $2MM-plus gross revenue, itself accounts for $19BN in aggregate revenue and over 142,000 jobs, stemming directly from its 1,700+ female business leaders. In the WPO, the largest number of businesses are in manufacturing and distribution and 25% of members generate over $10 million annually.
• Forbes called 2013 the “Year of the Female Founder.” As female entrepreneurship gains steam, interest from venture capitalists will grow as well. There are now a number of investment groups, like Golden Seeds, that specialize in funding and empowering women-led businesses.

It makes sense that we’re seeing such a tremendous growth rate for women-led and -owned businesses at this particular time in history. In 1977, only 4.5% of privately held businesses were owned by women. Those businesses were mainly in fashion, fitness and beauty. Today, the greatest number of multimillion-dollar women-owned businesses are in wholesale trade (20%), finance/insurance (12%), and transportation/warehousing (11%).

Over the last decade, women-led and owned businesses generating more than $1 million have grown 31%. That number would be even greater if businesses owned 50/50 by male and female partners and businesses with financial investors were included in census data.

With so many women-led and -owned businesses reaching such lofty benchmarks in the last decade, the stereotypes about female business leaders are thankfully beginning to wear thin. As more women ascend the corporate ladder or build their own businesses from the ground up, they’ll bring even visibility to the success of women throughout business.

Dr. Marsha Firestone

Dr. Marsha Firestone is Founder and President of the Women Presidents’ Organization (WPO), started in 1997 as a peer advisory organization connecting women who own multi-million dollar companies. She is also the Founder and President of the Women Presidents’ Educational Organization, dedicated to creating increased access to business opportunities for Women’s Business Enterprises (WBEs).