Women’s Entrepreneurship: The Research Based View

1. Women’s Entrepreneurship: The Research Based View Elizabeth Gatewood, Wake Forest University Candida Brush, Babson College Nancy Carter, Catalyst Patricia Greene, Babson College Myra Hart, Harvard University (retired) ESBRI 2012

2. The Diana Partners Magnus Aronsson and ESBRI Kauffman Foundation U.S. Small Business Administration National Women’s Business Council Numerous Universities

3. Motivation • News article----”Women receive less than 5% of venture capital investment in the U.S.” • We were friends and colleagues and interested in a joint project that would have impact---especially on women entrepreneurs

4. Women and VC Investments1957-1996 3.5 % for all years (290 of 8298) • 3.8% in 1996 n= 43 • 3.5% in 1997 n= 52 • 4.1% in 1998 n= 54

5. Myths • Women don’t want to run high growth businesses • Women lack the human capital • Women are unable to build strong management teams • Women are in industries unattractive to equity providers • Women lack the commitment • Women lack the financial savvy and resources • Women aren’t in the “network” • Women aren’t a force in the venture capital industry

6. Working Model Capital Seekers Financial Suppliers Context Financial Capital Financial Capital Facilitators Financial Providers Strategic Choice Firm Strategic Choice Social Capital Social Capital DEAL Human Capital Human Capital Structural Barriers Personal Goals Personal Goals D

7. Findings: Demand Side Human Capital: Women in U.S. generally well educated, and increasingly acquiring business experience;Women seekers were very well educated and hadappropriate experience Social Capital: Women’s networks are more diverse than men’s; Women focus on friendship & obligation in network relationships; men on exchange; Women seekers networked extensively

8. Findings: Demand Side Financial Capital: Women in U.S. generally preferred internal sources of capital; manywomen seekers used sophisticated bootstrap financing to position company for VC Personal Goals: Women’s growth goals may differ from men’s; like men, varying motives; Women have slightly lower aspirations for business size; Women seekers were interested in growing their businesses

9. Findings: Demand Side Strategic Choice: Women’s business concentrated in service and retail sector; Women more likely to start in health, education and medical field; Men in construction, manufacturing, transportation/communication; Increasing numbers of women starting ventures in technology sectors; Many Women seekers were in investment attractive industries

10. Findings: Supply Side It’s the Industry: Only 10% of decision makers in venture capital industry are women Industry increased 62% between 1995-2000; number of men increased 64%; women 47% Attrition rate among women in industry higher than for men (64% vs. 33%) Gender of entrepreneur doesn’t influence women VC vetting

11. Growth Influencers Growth Venture Concept industry, potential Individual Goals, capabilities Resources Financial, social, organizational

12. Diana International To provide a platform to develop, conduct and share a global research agenda To create an international community of scholars dedicated to answering questions about women entrepreneurs

13. History 2003 a & b ESBRI, Stockholm, Workshops 2004 ESBRI, Stockholm- Int’l Conference 2006 ESBRI, Stockholm - Int’l Conference 2007 Madrid - Int’l Symposium 2008 Belfast - Int’l Symposium 2010 Banff – Int’l Symposium 2012 Fremantle – Int’l Symposium 2014 ?

14. Diana International • Australia • Bulgaria • Canada • Chile • China • Denmark • Finland • Ireland • Germany • Hungary • Ireland • Korea • Netherlands • New Zealand • Northern Ireland • Norway • Scotland • Slovenia • Spain • Sweden • United Kingdom • USA

15. Female Participation by Economic Group: GEM 2010

16. Growth Influencers Growth Venture Concept industry, potential Environment Environment Individual Goals, capabilities Resources Financial, social, organizational Environment Culture, religion, legal and tax system