Britain has enjoyed a “surge” in female entrepreneurship over the past decade as women have begun to close the “enterprise gap” with men, research has shown.
A study of more than 10,000 people by Aston University found that the proportion of women who went into business rose by 45 per cent in the ten years to 2016, compared with growth of 27 per cent in male company founders over the same period. Most regions enjoyed significant increases in female entrepreneurs over the decade, as more women struck out on their own.
Emma Jones, founder of Enterprise Nation, the small business support group, said: “This is partly down to the fact women are looking for the freedom and flexibility that self-employment delivers and also that they are spotting creative gaps in the market.
“There’s also been a growing awareness of female entrepreneurial success stories being shared, which is helping to inspire other women.”
Despite the progress, men are still about twice as likely as women to start a business, with 5.5 per cent of women now self-defined as entrepreneurs compared with 10.4 per cent of men. The researchers, who used data collected by the Global Entrepreneurship Monitor project, also highlighted signs that the gap may have opened again last year. Women’s “early stage entrepreneurial activity” was flat in 2016 compared with the previous year, while male activity grew markedly.
The study defined entrepreneurship as any attempt at new business or new venture creation, such as self-employment, a new business organisation or the expansion of an existing business by an individual or team.
Once they had started a business, women were generally just as ambitious as their male counterparts. However, there was a confidence gap, with almost half of men expressing belief in their own ability to start a company compared with just over a third of women. Female entrepreneurs also tended to have a stronger fear of failure.
Karen Bonner, senior researcher at Aston Business School, said that the reasons for the continuing disparity between male and female entrepreneurship rates were complex. “On the one hand, we could point to different societal expectations, with women still taking on the bulk of unpaid caring roles and entrepreneurship still stereotyped as a male career choice in our wider culture,” she said. “When asked why they started their business, women are more likely to cite ‘greater flexibility for my personal and family life’ and the desire for ‘freedom to adapt my own approach to work’ than men.
“We also observe a tendency for women to be more risk-averse, which may make them self-select out of entrepreneurship, particularly in places where there are safer employment options that allow them to work more flexibly around caring responsibilities. This would help to explain why places like Northern Ireland and the northeast of England, with relatively high proportions of public sector jobs, have low start-up rates for both men and women.”
In the West Midlands, there were 74 female entrepreneurs for every 100 men. In the northwest, there were only 33 women founders for every 100 men who had started a business.
Emma Vartolomei, founder of All Street, which publishes investment research on small listed companies and those raising crowdfunding, said that women were not getting a fair deal when it came to raising venture capital. “I’m not feeling that the gap is closing,” she said. “When I go into a meeting with investors with my male co-director, they address him, not me. I get asked, ‘What happens if All Street doesn’t grow?’ A man would be asked, ‘How are you going to grow the company?’ Access to capital is being undermined by prejudice, even if it’s unconscious.”
Only one in ten decision-makers in British venture capital firms is a woman, while two thirds of venture capital firms have no female decision-makers at all, according to a study.
Ms Jones said it was important that support for women entrepreneurs did not focus too squarely on funding issues: “Many women just want to learn the basics and how to be more successful and grow slowly to suit them. There’s a lot more to be done to correct this.”
Sweet taste of success
Rosie Ginday’s Birmingham-based Miss Macaroon began in 2011 and now exports the French-style treats to customers in Paris and Cannes (James Hurley writes).
Ms Ginday, 33, trained as a pastry chef, including a spell at a Michelin-starred restaurant. She opened a macaroon and prosecco bar in Birmingham last year and is considering expansion to other cities. She says that the rise in female entrepreneurship over the past decade may have been partly inspired by necessity.
“With the effects of austerity and wages not growing in line with inflation to cover living costs, people feel they’ve got a better chance doing something by themselves. For me, it was about doing something I’m passionate about and learning new things. As a business owner you’re constantly having to do that and improve.”
Ms Ginday received advice on how to expand from the Goldman Sachs 10,000 Small Businesses programme and NatWest’s Entrepreneurial Spark initiative. She describes her business as a social enterprise and has offered training to 26 unemployed people, including ex-offenders, care leavers and victims of domestic violence. Six of them have been taken on as staff.