It is hardly news that women have historically grappled to be in positions of power – in society, politics, and business – far more than men have. This is a global phenomenon. In 2017, issues like soaring wage gap and gender-based discrimination at work still remain unresolved across geographies and income levels. Just about 21 women helm Fortune 500 companies around the world. We find an equally minuscule representation in entrepreneurship circles by-and-large. What doesn’t stop surprising me is how this is even possible when every study, research, workplace, and economic discourse points in one direction – that women are great for business! But the good news is that large democracies and economies like India and the US are sitting up and taking notice of this disparity, at least on paper.
Recent startup and business headlines have been rife with conversations about women leadership and entrepreneurship in India and around the world. In a first, the Global Entrepreneurship Summit (GES) has made women entrepreneurship the focal point of its 2017 edition. A joint effort by the United States of America and India, GES 2017 is going to be all about empowering women entrepreneurs with networking, mentorship, and workshops.
The idea is to help women entrepreneurs pitch ideas, find allies and partners within the ecosystem, secure funding, and innovate. The American delegation at GES 2017, led by Ivanka Trump, Advisor to President Donald Trump, will include women entrepreneurs and advocates, government and policy officials, and industry thought leaders. In the run-up to the event, Ivanka – an entrepreneur herself – has been vocal about the state of women entrepreneurship and her support to women entrepreneurs in India and the US. From advocating more participation from women in STEM areas to committing capital and mentorship to women entrepreneurs, Ivanka has touched upon several areas that need work and resources in order to bring women entrepreneurs at par with their male counterparts.
While we wait to see what the GES will deliver for women entrepreneurs, it is important to take stock of the challenges women entrepreneurs face, what holds them back, and will this combined focus on the problem be a much-needed turning point for women entrepreneurs.
According to the Global Entrepreneurship Monitor’s Women’s Entrepreneurship Report for 2016-2017, as of 2016, an estimated 163 million women were starting or running new businesses in 74 economies around the world. Add to that another 111 million who are running established businesses, and women entrepreneurship is poised to be the new normal around the world. In 2016, the total entrepreneurship activity by women increased by 10 percent and the gender gap narrowed by 5 percent. Entrepreneurial intentions have also increased by a good 14 percent among women around the world.
However, challenges like recognition, funding, and sustainability of women-led businesses remain. Women around the world are still less likely than men to start businesses. From an already small pool, there are more exits from women. Closer home, despite a near-revolution in the startup ecosystem with large-scale fundings and several unicorns, only 2 percent of equity-funded startups had women founders. That’s roughly $242.7 million of the $12 billion risk capital raised by private companies in 2017.
The disparity speaks for itself and these statistics have led to a vicious cycle of sorts – fewer women on top, fewer role models for young women, and fewer women taking the proverbial leap into entrepreneurship. From social conditioning to gender biases among not just the family patriarchs but even among VCs, to a social structure that still pretty much puts the entire onus of home and childcare entirely on women, plus lack of mentorship and ecosystem support networks – we can discuss the reasons for this disturbing disparity till the cows come home.
The good news though is that despite this soaring lack of allies and supporters, women run a good 14 percent of Indian businesses, almost 80 percent of which are self-funded. That signals positive change. With some effort in the right direction, mentorship, and support, Indian women are more than capable of breaking through the “iron ceiling” of entrepreneurship circles. These efforts are trickling in, one op-ed, one woman influencer, one industry panel, and one woman-led global unicorn at a time. With GES 2017 in tow and the conversations around a more inclusive entrepreneurship ecosystem reaching unprecedented decibels, we could be at a turning point of women entrepreneurship in India and around the world.
From the initial round of heavy-duty job creation almost immediately after liberalization back in the 90s to the glitzy tech parks, development centres, startup incubation centres, funding, and mentorship today, the US has been a close partner and ally for India’s software and startup revolutions at different points in time. Far from being one-sided, the partnership has helped American companies access some of the best tech talents in Asia and has been mutually beneficial by-and-large.
It is only natural that when the conversations around women at work and women entrepreneurship reach the kind of decibels that they have in recent times, we tap in on the expertise and influence of a trade partner and ally who has been there, done that. Going purely by numbers, 40 percent of US entrepreneurs are now women. Only 13 percent of those start out of necessity. They are also the most educated of the lot, with over 80 percent of them holding postgraduate degrees. However, the US too is grappling with the issue of lack of funding for women, although the scale of the problem is much smaller than it is in India, with about 9 percent of women entrepreneurs exiting businesses because of lack of funding.
With both India and US grappling with different sets of challenges when it comes to women entrepreneurship, and both countries leading the charge and advocating on behalf of women entrepreneurs, the 2017 edition of GES holds immense potential. We are hoping that the needle will move from common and well-known platitudes about the importance of women leaders and entrepreneurs to real action, support, mentorship, and most importantly, funding – for India and the world’s growing pool of poised, spirited, and extremely capable women entrepreneurs. It’s about time too.