Women rule: Self-confidence is key to female entrepreneurship

A view of a woman's arms and hands from above as she works at a laptop. She is wearing a faux fur jacket and several rings.

First, the good news: The number of woman-owned businesses is on the increase.

Now the bad: The entrepreneurship gender gap is alive and well.

Despite making up slightly more than half the population of the United States, and surpassing men in college degrees, women still lag men in business ownership.

So, what’s it going to take for more women to claim the title #bossgirl? It might be as simple – and complicated – as a matter of confidence.

While scholars have identified many gender-based barriers to entrepreneurship, confidence emerged as a significant factor in the 2018 Amway Global Entrepreneurship Report (AGER), a study of the intrinsic and extrinsic aspects of entrepreneurship based on interviews with nearly 50,000 men and women worldwide.

AGER points to confidence

For the third time in its eight-year history, AGER included a measure of the Amway Entrepreneurial Spirit Index (AESI), a calculation based on entrepreneurial desire, confidence in one’s abilities and perceived social stability. The overall AESI was 54 for the United States. That’s comparable to previous years, but heavily weighted toward the guys: Males scored an index of 62, compared to 48 for females.

That 14-point gap hints at significant underlying differences between the genders in the United States. According to AGER:

  • More men than women – 67 percent to 47 percent – expressed a desire to start a business.
  • Sixty-nine percent of men expressed confidence in their abilities, compared to 52 percent of women.
  • And 49 percent of men believed they could sustain a business even in face of social pressure, compared to 44 percent of women.

Gender clearly plays a role in shaping the entrepreneurial spirit in the United States. This is despite evidence that more women are making the leap into business ownership.

“Entrepreneurship is more than just officially launching a business – it is about people’s attitudes and motivations,” Amway North America Managing Director Jim Ayers said. “This shows that there is a lot of opportunity to support women who want to start their own business.”

Woman-owned businesses increase

The most recently reported Census Bureau five-year Survey of Business Owners counted 9.9 million women-owned firms in 2012 – a 26.8 percent increase from five years earlier. That’s significant growth, but there is potential for more. Even though women make up 51.8 percent of the U.S. population, women-owned firms accounted for just 35.8 percent of all U.S. companies.

In a 2017 study for the think tank Third Way, “Empowering Equality: 5 Challenges Faced by Women Entrepreneurs,” researchers Susan Coleman and Alicia Robb identified the challenges as: human capital (education and experience), social capital (networks), financial capital (sources of funding), and the need for role models. They noted studies showing that women have lower levels of self-efficacy than men, referring to their belief that they have the skills and abilities to perform the task.

“If women entrepreneurs have less confidence in their abilities, they may be less willing to take the types of risks that accompany launching or growing a firm,” the researchers wrote.

Role models are key

Coleman and Robb suggest one solution is to provide more role models: “The stories are out there; we just have to do a better job of telling them and making sure that those examples filter down to girls and young women.”

The authors also recommend that aspiring entrepreneurs find a mentor, and that successful women entrepreneurs return the favor by acting as mentors. Ayers agreed.

A closeup shot of two people's hands each holding a coffee cup at a cafe.“Coaching plays a key role in the Amway business,” Ayers said. “We don’t want anyone to feel like they are in this by themselves. A large part of the training we offer Amway Independent Business Owners is how to set themselves up for success, and then how to do the same for others through coaching.”

It’s part of the package of world-class business resources available to people when they become an IBO, including a choice of online or in-person training programs, customer support, business management, order management and motivation.

If that’s not enough for you, take heart in the words of none other than Eleanor Roosevelt, who in her 1960 book “You Learn by Living: Eleven Keys for a More Fulfilling Life” offered the following advice:

“You gain strength, courage and confidence by every experience in which you really stop to look fear in the face. … You must do the thing you think you cannot do.”

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