Why focus on female-run businesses?
According to the 2019 State of Women-Owned in Businesses report from American Express, between 2014 and 2019, the number of women-owned businesses rose 21% to a total of nearly 13 million (12,943,400), employment grew by 8% to 9.4 million, and revenue rose 21% to $1.9 trillion.
Last year, 1,821 women-owned businesses were launched every day.
This is encouraging news. While the growth in female-owned businesses in America has more than doubled in twenty years, championing women-owned businesses has never been more critical.
Why? Several reasons.
For one, the diversity of having more female leaders in the community strengthens our economy and local communities. Because women have unique perspectives and skills, they are able to problem solve in new ways, driving innovation.
Additionally, female-owned business owners help inspire the next generation of female entrepreneurs. In doing this, they will foster a new wave of diverse businesses, driving society forward.
Who was the first woman entrepreneur in America?
So, where did it all begin?
While women have trailblazed for years, one of the first documented female entrepreneurs and first African American female billionaire was Madame C.J. Walker.
She had a rough start to her life. She was born to former slaves, orphaned at age seven, a mother by 17, and a widow by 20.
So, how did this young female entrepreneur step into the spotlight as the first woman entrepreneur?
In the late 19th century, after experiencing her own hair loss, Madam C.J. Walker began to experiment and develop a hair product that aids with hair loss. She came up with the idea in a dream, and in a few weeks of using the hair concoction, her hair was growing faster than it had ever fallen out.
She started selling it by traveling door-to-door, teaching women about the product in 1905, with $1.50 to her name. By the end of 1910, she had thousands of people working for her across the country and earned $7,000 a week nearly, an equivalent of $175,000 today.
She grew her business even more by training women to help her sell the product. Walker enlisted her agents to sell beauty products and spread her philanthropic efforts of teaching self-empowerment to African American communities.
She was one of the first woman entrepreneurial visionaries to see that women could earn their mark and become economically independent.
Why Should Women Be Entrepreneurs?
There are several reasons why women should become entrepreneurs.
- Make an impact: When women show up in the business world, they bring a unique perspective and set of skills that have the potential to make the world a better place. Their unique insights and innovation have immense value and are sometimes best expressed outside of corporate career paths.
- Flexibility: Work-life balance doesn’t exist with many corporate, 9-5 jobs. In becoming an entrepreneur, you set your own schedule, allowing for extra flexibility. For example, if you’re a night owl, many entrepreneurs burn the midnight oil at this time. Or, if you have a family to attend to, you can work when you’re free throughout the day—in between caring for your children.
- You can set your rates and charge what you’re worth: Unlike a regular job, you set the price for your business or service. You are not bound by a fixed salary.
- Market demand: Women have a keen sense of what’s missing within a market. Thus they can innovate to fill a market demand for a specific product or service.
- Following a passion: Similar to Madam C.J. Walker, you can follow your true passion. For her, it was hair, but for you, it may be something else. Entrepreneurship allows women to pursue the exact niche they thrive in.
- Circumventing the glass ceiling: Unfortunately, a glass ceiling still exists for females in the workforce. (One example is the gender pay gap. In a recent PayScale report, the findings reveal that the uncontrolled gender pay gap, which takes the ratio of women’s median earnings to men without controlling for various compensable factors, women make only $0.82 for every dollar a man makes.
- Having more career control: As an entrepreneur, you’re in the driver’s seat. Point blank: as an entrepreneur, you have more control over who, what, where, and when you work. For example, you control who you work with, including clients and business partners as an entrepreneur.
What are some tips for women eager to become entrepreneurs?
With a little foresight, you can create a flourishing female-run enterprise.
So, what are some essential tips women entrepreneurs should be mindful of when starting a business as a woman? Here are some of the top ones:
1 - Master the fundamentals
This is an essential step for every entrepreneur, regardless of gender: mastering the basic building blocks of business, including the 'back office' tasks like small business taxes and accounting.
If you’re used to being a W-2 employee, taxes as a small business owner are vastly different. You must be mindful of the following:
- Deciding on a business structure. It helps determine what income tax return forms you need to file. The IRS offers some helpful advice on choosing a business structure, based on your tax obligations.
- Filing for an Employer Identification Number, or EIN, for federal tax filing. The IRS website informs you whether or not you need this number.
- Keeping business and personal finances separate. Keeping your accounts separate helps you track expenses, simplifies the bookkeeping process, and allows you to maintain clear financial records in case of an IRS audit.
- Factoring in self-employment tax rates. If you generate more than $400 per year, you have to pay self-employment tax in addition to income tax—that’s 15.3% more than a standard employee.
- Estimating tax payments. If you make a certain amount per year, you have to pay estimated tax payments, which are quarterly tax payments. You generally should make estimated tax payments if you expect to owe $1,000 or more in taxes per quarter.
2 - Focus your time and energy in the right spots
Owning a business and being a partner or mother, daughter, or friend (or all of the above), means that you must know where and what to prioritize when it comes to operating your business. By focusing on specific business tasks, you can check off tasks to move the dial on your business.
For example, if you’re in a service-based business, make sure the potential client aligns with your fee structure, timeline, work style, and business goals.
On the flip side, being focused as a product entrepreneur means honing your business plan and catering all marketing activities and client acquisition strategies to the specific tactics listed.
3 - Don’t hide behind your business; be the face of it
Your social media profiles are frequently viewed as a business owner. With a strong personal brand, you can leverage it to boost your small business’ visibility. Doing this will open doors for others to view you as a thought leader and further entrust your business.
Here are some sub-tips to do this:
Focus on the right channels
Stay active on social networks where referrals and potential clients and business partners are. Take the time to research each network, for they work differently and have different audiences. For example, if you’re a female entrepreneur who just started a hair care line, you may want to focus on Facebook or Instagram. If you’re an entrepreneur who just started a marketing consulting business, target LinkedIn.
Optimize your profile
Don’t let people scratch their heads about what you do as a business owner. Optimize your social media profiles to reflect who you are as a female entrepreneur. Upload a professional headshot, include keywords that reflect your beliefs and business strengths within your social biographies, and include links to your business’ website.
Create meaningful relationships
Find influencers in your industry or community and engage with them. This can extend outside of the online realm, too! Connect within your community!
4 - Spread the word
In addition to being the face of your business, think of ways you can promote your business. Whether it's a landing page, email marketing, Facebook advertising, pop-up, postcard, or billboard, it’s important to choose the right avenues to market your business.
One of the best things to do is create an attractive and informative website. It should be the “hub” of your business. Every “spokes”, like social media channels, online ads, landing pages, email, and other marketing channels, should lead prospective customers there.
Many new female business owners fear that they can’t make their own website because they don’t know code. Thanks to modern-day tools like Leadpages with drag and drop functionality, no web design or coding skills are ever required.
Your website should be well thought out and proudly display your products or services. If you also have a brick-and-mortar store, the site should entice web visitors to enter your store.
Need more info in this area? Learn about the 10 small business website and marketing tips you can’t afford to ignore.
5 - Get connected
As you navigate through your new business, you need many resources along the way, from capital assets to expert guidance. Throughout your journey, figure out precisely what you need at each stage and ask for it.
Tap into local or online networks, share connections with other female entrepreneurs, and immerse yourself into the vast amount of resources out there. Assert yourself and don’t live on an island… Connect!
Whether it’s hiring an accountant, marketer, business coach, or hiring part-time help, chalk this up as a benefit to your business!
6 - Give back
As you embark further on your journey as an entrepreneur, remember to give back. Become a mentor, or find one. Good resources for finding new organizations to help out are the National Association of Women Business Owners, Women Who Startup, Women’s Venture Fund, and 37 Angels.
At a minimum, support other women-owned businesses. Shop in their stores, carry their business cards and drop them off at public locations, and lift other women entrepreneurs up!
We can support our nation's women small business owners by building and nurturing local and regional collaboration that brings together government, capital development organizations, and other stakeholders to improve the business climate for women entrepreneurs.
Carla Harris, Chair of the National Women's Business Council
BONUS CONTENT
Who are the most successful (female) entrepreneurs in the world?
While there are many successful female entrepreneurs out there, a few stand out. Here are some of them:
Gina Rinehart
Billionaire Gina Rinehart is the chairman of Hancock Prospecting Group, an Australian mining company. She acquired the company from her father in 1992, and since then has orchestrated the procurement of 30 million tons of iron ore per year.
She’s the richest person in Australia and the 6th richest woman globally, with a fortune totaling $11.7 billion.
Cher Wang
Cher Wang is one of the most successful female entrepreneurs worldwide with a net worth of $1.6 billion. She is the co-founder of HTC, the famous mobile technology company.
She started her career at ‘First International Computer‘ and went on to co-found HTC in 1997. For decades, she’s been a leading force at HTC, competing among the likes of other mobile technology companies like Apple, Sony, and Samsung.
Oprah Winfrey
Oprah Winfrey became the leading lady of daytime television, best known for her American talk show, The Oprah Winfrey Show, which was the highest rated television show of its kind. Former television host, Oprah is also a television producer, actress, author, philanthropist, as well as founder and owner of OWN, the Oprah Winfrey Network.
Oprah was the richest African American of the 20th century and North America's first black multi-billionaire, and is frequently praised as the most influential woman in the world.
Denise Coates
United Kingdom-based Denise Coates started Bet365. The site allegedly took her a year to develop and launch. She managed to fund the business by getting a £15 million loan from the Royal Bank of Scotland (which is about $20 million in U.S. dollars), turning it into one of the world’s largest online sports gambling websites.
Currently, Forbes estimates her net worth at $9.5 billion. As women-owned, she was the highest-paid chief executive of any British company, according to the Sunday Times Rich List.
Anne Wojcicki
In 2006, Anne Wojcicki co-founded 23andMe, a company that helps customers understand what their DNA says about their health, traits, and ancestry. In 2018, they raised $300 million from GlaxoSmithKline, Sequoia, and Google, bringing the company’s total funding amount to $786 million.
Today she serves as CEO and has trailblazed the way for many other women in the pharma/medical field.
Tory Burch
The creator of the ballet flat, Tory Burch, is another American-born female entrepreneur who has risen the ranks.
She began her career working with designers like Vera Wang, Ralph Lauren, and Narciso Rodriguez. In 2004, she launched her lifestyle brand, Tory Burch, out of her NYC apartment, featuring ready-to-wear products and women’s accessories.
Jessica O. Matthews
At the age of 19, Jessica began her entrepreneurial journey with the invention of SOCCKET ball, a power-generating soccer ball, powered by technology that offers life-changing applications in communities with limited access to the electrical grid. Today, Jessica is founder and CEO of Uncharted Power, which raised $7 million for its series A funding in 2016 and is dedicated to putting the recharging technology in everyday products.
Sara Blakely
From a woman who traveled door-to-door selling fax machines, to founding “Spanx, “a multi-million-dollar undergarment company, Sara Blakely is a modern-day success story.
With a current net worth of $1 billion, Sara Blakely is one of the world’s youngest self-made female billionaires.
Ariana Huffington
With a net worth of $50 million, Greek-born journalist Ariana Huffington, founder of The Huffington Post. A few years ago, she sold the company AOL for $315 million and remains an integral part of the company’s daily operation.
Since selling The Huffington Post, she has authored multiple books, including “Thrive: The Third Metric to Success.” She remains a prolific media mogul, and since selling The Post, she launched Thrive Global, a start-up dedicated to health and wellness.
Payal Kadakia
Payal Kadakia, the executive chairman and co-founder of ClassPass, a subscription-based service that allows users to browse and book fitness classes in their area. During her time at Classpass, she acquired $239 million in funding from Acequia Capital, Hank Vigil, General Catalyst, GV, Temasek Holdings. Appearing on the Forbes’ Women Entrepreneurs to Watch list and Fortune’s 40 under 40 lists, she is a pivotal female figure in America for future budding technology careers.
Cristina Junqueira
Brazil-based Cristina Junqueira is a co-founder (and vice president of branding and business development) at NuBank, a South American start-up company that administers, processes, and transfers payments related to post-paid credit cards and equity investments. Based in Sao Paulo, NuBank is a unicorn company. It has been invested in by Tencent Holdings, Founders Fund, Sequoia Capital, Fortress Investment Group, DST Global, Goldman Sachs, Tiger Global Management. Its current total funding amount is $707.6 million, according to CrunchBase.
Annie Tao
Based in Beijing, Horizon Robotics provides integrated and open embedded Artificial Intelligence solutions at scale. Annie Tao, who is the co-founder and vice president of operations of the company, has spearheaded the Chinese-based company’s growth, reaching $700 million in investments.
Have any other female-run small business suggestions? Let us know!
