September saw the launch of a new Treasury review to investigate the ongoing barriers for women in business. Women in the UK are still only half as likely as men to start a business. Only one third of existing entrepreneurs are women, and only one in five SME employers being run by women. This can only weaken our economy and competitiveness on the global stage.
Private banking chief, Alison Rose, one of the most influential women in banking, is bringing her expertise to help examine where the problems lie that still hold back female entrepreneurs. The Treasury team will examine barriers to female entrepreneurship including gender bias, access to finance, how men and women’s approaches to entrepreneurship differ and look at what can be done to help women grow businesses.
The gap between the finance awarded to men and women is still surprisingly large.
Access Commercial Finances latest study earlier in the year reported men receiving £4051.052 in comparison to women receiving £332.437.
But Access’s figures also indicated another problem behind this. Since July 2016, only 16% of small business loan applications were from women. On average, women ask for substantially less than men do. Ironically, women are 18% more likely to receive business funding.
Gender bias is undoubtedly alive and well in the old boys network of private and VC funding, which is still heavily reliant on who you know and with an almost bizarre degree of misogyny still to be found. For more high risk the finance required, the more male dominated the sources become, the more a back-slapping network where women are outsiders. From my own experiences, I know how off-putting this can be to females.
Natasha Mudhar, CEO of the international communications consultancy, Sterling media, is someone who has broken through barriers in a male dominated sector and she sees much of the problems lying in gender bias. “That women are half as likely to start a business as men is disappointing, and this is certainly not due to lack of skill – but more due to society putting women down and making them feel they aren’t capable. People shouldn’t be surprised when a woman can hold her own in the boardroom, or when they successfully run an international business.” She believes gender discrimination is very much a prevalent issue still in the UK, be it pay, harassment or sexual assault.
Women’s lack of confidence can be exacerbated by their own staff and colleagues. Once again, I have first-hand experience of this. Their ideas can be dismissed purely because they are female. Problems which have been so well highlighted in the corporate world, such as women’s low self-confidence, their fear of pushing themselves forward, all still exist in the world of entrepreneurship. But as leaders, women are far more isolated and lacking in the right support. I had a number of male business coaches over the years when I was in manufacturing, and every single one of them noted complacently that obviously the problems came from me being a female.
Within the home it can be little different. I see many hugely capable women, harassed by juggling a small business alongside small children, unable to afford adequate childcare. I see a complicity in their partners to leave these problems unsolved, many far preferring their own traditional role of breadwinner, with the loving wife caring for the home. So all too often, there is no support for the woman at home to start anything more than a pin money business and overly-ambitious female dreams are kept firmly in place.
The lack of confidence, which holds women back in so many ways in business, comes from centuries of conditioning. From birth, many girls are still protected by their doting daddies from the realities of life, and they do not have the chance to develop as much resilience to the possibilities of risk and failure. Women are therefore under-confident and far more afraid of failure than their male counterparts. The male, who will be well supported within his back-slapping businessmen’s network, accepts failure as an essential step in development. Women find it too frightening to contemplate. Many don’t have the confidence yet to challenge old belief systems and old social sets.
Sadly, business risks are rarely taught as part of business courses and virtually never within educational ones. If they were, women would then have a chance to familiarise and accept them better. The risk adversity and caution, which often makes women such valuable board members, does not always work in their favour in the world of entrepreneurship.
Women tend to start businesses on far smaller scales than men. They are often started to fit round motherhood and thus on a part time basis. So part of it is simply that may women do not want to scale up. But it is also lack of confidence and lack of perceiving themselves within the entrepreneurial role. America still encourages more businesses to scale, both male and female led, than we do in Europe, and unless more women are encouraged to scale, they will simply not have the need to apply for funding.
What holds women back is complex. It will be fascinating to see the results of this latest review next Spring and it may well result in some practical changes. Breaking moulds, changing perceptions and building confidence will come more from the example of the growing number of ground-breaking entrepreneurs who the rest can follow.