Women-Owned Businesses in the US, Continuous Growth Despite the Challenges
From 2000 to 2018, the number of women-owned businesses rose by 21%, while businesses owned by men only increased by 9%.
The United States is home to over 11 million women-owned businesses, according to the National Association of Women Business Owners (NAWBO). These businesses employ 8.6 million people and generate $1.8 trillion in revenue annually. Women-owned businesses are a significant economic force in the US, and their presence is growing. From 2000 to 2018, the number of women-owned businesses rose by 21%, while businesses owned by men only increased by 9%. This growth rate is almost double, showing that women are increasingly interested in the entrepreneurial path and taking advantage of the available resources. According to Statista, “by 2020, the total funds raised by Black and Latinx female-founded startups in the United States had more than doubled compared to 2018.” amounting to a “total of funds raised of 3.1 billion US dollars, 2.1 billion US dollars more than the value of funds raised in 2018.”
A Harvard Business Review study showed that “in the United States, 17% of Black women are in the process of starting or running new businesses. That’s compared to just 10% of white women and 15% of white men.” However, only 3% of these black women-owned businesses become mature. The reason behind this disparity illustrates the challenges that women-owned businesses, particularly those led by women of color, face. Gender biases often affect the rate of growth and viability of these businesses, which also struggle to get the same recognition as enterprises started and managed by men.
Among the unique challenges women-owned businesses face are a need for access to essential business loans, lower credit scores, difficulties acquiring seed capital, etc. At least 31% of women-owned businesses are in the service industry, which suffered greatly during the height of the COVID-19 pandemic, and in many cases, are still reeling from two years of losses. Additionally, women-owned businesses often have limited access to mentors, networks, and other resources that could help them develop, an issue that has only recently been more intentionally addressed by organizations such as the Association of Women’s Business Centers. The AWBC works to secure economic justice and entrepreneurial opportunities for women by supporting and sustaining a national network of 140 Women’s Business Centers (WBC). According to AWBS’s CEO Corrine Hodges, the network “provides free counseling, training, networking opportunities and perhaps most importantly, access to much-needed funding (or capital) for businesses to get started and grow.”
Women entrepreneurs often have to work harder to prove their capabilities and gain the trust of potential investors and partners. Over a third of all female entrepreneurs experience gender bias, with women receiving 5% less funding than their male counterparts.
How to Support Women-Owned Businesses
Despite these challenges, women-owned businesses are continuing to thrive. There are now more women-owned businesses than ever before, and they are making a massive contribution to the US economy. It is vital to continue to support these businesses and recognize their successes, and often the best way to start is to focus on our communities. Support your friends and family businesses by sharing and promoting their work and services, write a review on google or yelp, and share their contact with people you meet. You can also attend local markets and events that showcase local enterprises and patronize them. There are small and big ways to support the development and growth of women-owned businesses intentionally, don’t hesitate to lend your voice and resources to make a difference.
What are your favorite women-owned businesses? How do you support them? Let us know in the comments!
Revenues, Profits Of Companies Owned By Women Decreased 26% During 2021,https://www.forbes.com/sites/rohitarora/2022/03/08/revenues-profits-of-companies-owned-by-women-decreased-during-2021/?sh=64c793b97ca6
Total funds raised by Black and Latinx female-founded startups in the United States in 2018 and 2020, https://www.statista.com/statistics/1223078/funds-raised-black-latinx-female-founders-usa/
Black Women Are More Likely to Start a Business than White Men, https://hbr.org/2021/05/black-women-are-more-likely-to-start-a-business-than-white-men
Women Entrepreneurs Statistics: Equality in 2022, https://writersblocklive.com/blog/women-entrepreneurs-statistics