Nellie Akalp is CEO of CorpNet.com. Forming more than 100,000 corporations and LLCs across the U.S, she has built a strong passion to assist entrepreneurs in starting and building their business the right way.
In 2010, women became the majority of the U.S. workforce for the first time in the country’s history. Also, 57% of college students are now women. Women now make up 54% of accountants, 45% of law associates and approximately 50% of all banking and insurance jobs. (“The End of Men”)
Women are advancing in entrepreneurship. An American Express OPEN State of Women-Owned Businesses report found that between 1997 and 2011, the number of women-owned firms increased by 50%. Businesses owned by females are now 49% of U.S. firms.
Is today’s business climate more inviting for aspiring women entrepreneurs?
The need for Dual Income Households
The growth in women-owned businesses can partly be attributed to reliance on a dual-income household. Following increased unemployment rates and a higher cost of living, women stepped in to supplement household income.
The Digital Age and Childcare
Entrepreneurship in the digital age lends itself to childcare, a consideration that affects any discussion of women in the workforce. Virtual workplaces and digitally mobile lifestyles give aspiring women entrepreneurs the flexibility to achieve the balance of career and family. Digital tools mean that women can now build a business from home and create unique work schedules.
Essential Skills in the Digital Age
Do women’s strong communication and social skills help them thrive in our post-industrial digital age? Do women have specific skills that can help them succeed as entrepreneurs? In my experience helping entrepreneurs and small business owners launch their brands, I believe there are several traditionally “feminine” leadership qualities that are more significant now than ever.
1. Women possess strong communication skills and social intelligence.
The digital economy requires strong communication skills and social networking which women do very well. Rosin’s article discusses a Columbia Business School program that teaches sensitive leadership and social intelligence, including a lesson in reading facial expressions and body language. They don’t say it, but these are traits traditionally associated with femininity.
2. Women make good listeners.
One study found that the collective intelligence of a group rose if the group included more women. Anita Woolley, assistant professor at Carnegie Mellon University, asks, “What do you hear about great groups? Not that the members are all really smart, but that they listen to each other. They share criticism constructively. They have open minds. They’re not autocratic.” And when women are a part of the group, this listening characteristic improved the synergy of the entire group.
Women tend to be better listeners and are stronger at drawing people into conversation. This translates into being better attuned to customer needs and building more effective teams of employees, contractors and partners. In fact, many women entrepreneurs often describe building their business as building a team.
3. Women collaborate.
A 2009 Time magazine article by Claire Shipman and Katty Kay says, “[Women are] consensus builders, conciliators and collaborators, and they employ what is called a transformational leadership style — heavily engaged, motivational, extremely well suited for the emerging, less hierarchical workplace.”
4. Women prefer lower risk.
Research shows that women prefer lower risk opportunities and are willing to settle for lower returns. A 2007 study from the Small Business Administration (Are Male and Female Entrepreneurs Really That Different?) observes that women are more likely to prioritize that business and personal lives work in harmony.
The digital age offers a wealth of low-risk opportunities. Ventures like blogging, web-based services, ecommerce and software development require smaller upstart costs. Cloud-based tools and virtual workforces further lower the cost of entry, making the idea of starting a business more feasible and/or palatable for risk-averse entrepreneurs.
The tendency to minimize risk can lead to higher success rates for female entrepreneurs. That 2007 SBA study found that woman-owned businesses were more likely to have positive revenues. However, it can also mean women are more likely to limit the size of their businesses, and less likely to pursue outside funding from investors to fuel growth.
It’s up to each individual business owner to define the goals of her business. Perhaps pursuing a smaller business venture that lets her balance business and personal life in more harmony, is a smarter lifestyle decision. I think we should celebrate the growth in women entrepreneurs and continue to encourage more to start up their own businesses.