Carla Harris

The biggest stumbling block to starting a new business — and succeeding — for anyone, is money. For women, the challenge is multiplied.

There are plenty of reasons why women are left out in the cold, ranging from the lack of access to investors to not being taken seriously. Yes, even in this day and age, “access to capital is one of the most significant hurdles for women starting and growing their businesses,” says Carla Harris, chair of the National Women’s Business Council (NWBC), a 30-year-old, nonpartisan federal group that serves as an independent source of advice and counsel to the President, Congress and the U.S. Small Business Administration on economic issues of importance to women business owners.

I just interviewed Harris, who was appointed by President Barack Obama to chair the NWBC in 2013, for her insights about women entrepreneurs and her advice for women who have launched businesses or hope to soon.

“NWBC research has shown that men tend to start their businesses with nearly twice as much financial capital than women ($135,000 versus $75,000),” Harris, who is also a vice chairman, managing director and senior client adviser at Morgan Stanley. told me. “Access to markets is an integral component of business success.”

Some more discouraging news, from Harris: “The federal government has a statutory goal of awarding 5 percent of eligible prime contracting dollars to women-owned small businesses. Since the establishment of this goal in 1994, it wasn’t until two years ago that it first met its goal and missed it in 2016.”

Harris is waiting to see the report card for 2017.  “It’s a significant indicator of progress for women business owners, if met,” she says.

Seriously. Given that the growth of women business enterprises over the last 10 years is unprecedented, I’m reminded of the old image that Ginger Rogers evoked of women dancing backwards in heels.

In its recently published Accelerating the Future of Women Entrepreneurs: The National Women’s Business Council 2017 Annual Reportthe NWBC notes that, according to the U.S. Census Bureau, between 2002 and 2012, the number of women-owned firms increased at a rate 2 ½ times the national average (52 percent vs. 20 percent) and employment in women-owned firms grew at an impressive rate: 4 ½ times that of all firms (18 percent vs. just 4 percent).  Women are starting more than 1,140 businesses a day, says Harris’ group.

As of 2012, there were 3.2 million women entrepreneurs over 55. From 2007 to 2012, Harris says, women entrepreneurs over 65 saw the highest growth of the number of firms in any age group for men or women — up 42 percent.

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And American Express’ 2017 State of Women-Owned Businesses Report, estimates that from 1997 to 2017 the number of women-owned firms also increased by a rate of roughly more than 2 ½  times the national average (114 percent vs. 44 percent).

With that big picture in mind, here’s more from Harris:

Next Avenue: What can women entrepreneurs do to be more successful?

Carla Harris: Women entrepreneurs should leverage the resources already in place, as there are a plethora of supports across the country specific to women business owners. In a thriving ecosystem, there are in-person and virtual incubators and accelerators, SBA resource partners such as SCORE, Women Business Centers and Small Business Development Centers, as well as online educational resources that provide powerful knowledge throughout the business lifecycle.

Also, leveraging human capital and your already established network is essential and could include finding a mentor that is right for you and your stage of business.

Create a plan to access the capital — one that looks at traditional ways of financing, but also look at additional strategies for accessing capital such as crowdfunding, community development financial institutions, microloan programs and the network of angel investors that are specifically focused on women.

What is going on at the Small Business Administration — or not going on there — regarding women business owners and small business owners in general?

At NWBC, we are committed to working more closely with the U.S. Small Business Administration, the Congress, and the White House to promote and construct policies that will address access to capital and market inequities that women business owners still face. We strongly believe that if we can address these two particular challenges, then women business owners will have the most important tools that they need to successfully scale their businesses and to accelerate their impressive rate of job creation.

In our Annual Report, we recognized the critical policy actions the administration took in science, technology, engineering, and mathematics (STEM), cybersecurity, and disaster relief and recovery during the past year. Based off our research, various engagements within the entrepreneurial ecosystem and conversations with our key stakeholders, we developed in the report eleven actionable recommendations that are a priority for all stakeholders in order to accelerate policy change to support women entrepreneurs.

How is necessity a driver of entrepreneurship?

Many women become entrepreneurs out of necessity. While the traditional definitions largely focus on the concept of survival entrepreneurship or emergency entrepreneurship, NWBC research shows that there are broader implications than just starting a business to meet basic and immediate economic needs for survival.

For example, there may not be available employment options for women to achieve their desired career or financial outcomes or there may be overly restrictive or outright absent workplace policies that do not acknowledge or accommodate the caregiving roles that women, in particular, play in modern society.

All these factors contribute to a women’s necessity to become an entrepreneur rather than seek traditional means of employment.

Because research highlights that enthusiastic or opportunistic entrepreneurs are more likely to succeed than reluctant entrepreneurs, more likely to create jobs, and more likely to meaningfully contribute to the economy, it is in the country’s best interest to pave the way for their success.


What are some of the gender-specific motivations, and how has that changed in recent years for women?

There are a number of societal deterrents particular to women that can be critical motivators for women starting their businesses: including discrimination, child care challenges, pay inequities and restrictive workplace policies.

Restrictive workplace polices often center around situations such as maternal leave or sick leave, when balancing caretaking responsibilities. There have been some changes including state, family and medical leave, but these are not nationwide.

For broader change and a marked improvement in women’s professional advancement away from entrepreneurship, more advanced policy directives should be explored that can alleviate such flexibility challenges, so no woman has to choose between employment and caring for a child or elderly parent.

What are the key resources to help women start and run a business today?

Women entrepreneurs identified SBA’s Women’s Business Centers, incubators, mentors, professional networks and even friends and family as key resources to help with starting and running a business.

Other examples of resources that are included in the Council’s online, searchable repository, Grow Her Business: A Resource from Start-up to Scale-up, are: venture capital opportunities, membership associations, mentorship opportunities, conferences, competitions and accelerator and incubator programs.


What contributes to the success of older women entrepreneurs?

From our various conversations with women entrepreneurs around the country, we have learned that many women enter entrepreneurship after retirement or as a second career.

Women entrepreneurs 50-plus have unique perspectives, connections and relationships they have cultivated throughout their careers that they can leverage for the success of their businesses. They are also more likely to have their own capital as well as a network of potential capital they can access for their businesses. Our studies show that emerging companies that start with a strong foundation of capital are far more likely to be successful than those who are poorly capitalized.

By Kerry Hannon

Kerry Hannon has covered personal finance, retirement and careers for The New York Times, Forbes, Money, U.S. News & World Report and USA Today, among other publications. She is the author of a dozen books including Money Confidence: Really Smart Financial Moves for Newly Single Women,  Great Jobs for Everyone 50+: Finding Work That Keeps You Happy and Healthy…and Pays the BillsGetting the Job You Want After 50, Love Your Job: The New Rules for Career Happiness and What’s Next? Finding Your Passion and Your Dream Job in Your Forties, Fifties and Beyond. Her website is kerryhannon.com. Follow her on Twitter @kerryhannon.

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