Ask the Experts


New internet start-ups are dominated by men, which makes me hesitant to work on my idea. Why are there so few women entrepreneurs?

While your observation is correct, the good news is that female entrepreneurship is on the rise. Our culture is growing more robust with enterprising women equipped with knowledge, inspiration, creativity and funding. The rate of women entrepreneurs has been increasing at a percentage at least double that of males. But the gender composition of our culture’s most influential leaders indicates that there is still a way to go. Differences among the genders in terms of work experience, resources, deep-rooted biases, and social ties are a few of the issues that you need to overcome.

Despite a move in the right direction, some figures are still quite startling. Women occupy around 20% of the U.S. National Congress and currently hold just 5.4% of CEO positions at S&P 500 companies. Women are less likely to lead new business ventures with men two times more likely to launch a new enterprise, and only 28% of private firms are owned by women, according to the National Women’s Business Council.

Gender differences with regards to work experience, social ties, and resources have conventionally been attributed to the dearth in female entrepreneurs. However, a new theory has arisen that suggest unconscious cognitive biases also play a role. Women entrepreneurs are at a disadvantage because there are doubts that they possess the typical traits and skills associated with entrepreneurship.

This dynamic suggests there have been numerous concepts that could have flourished into successful businesses, but failed to do so since the person making the pitch was not the right gender. Deep-rooted biases can only be overcome by a cultural shift, notes young female co-founder of e-commerce startup Rukkus.

Studies have been carried out to test these preconceptions. Findings suggested that male-proposed business ideas are generally responded to with risk-benefit calculations, as a venture capitalist would when considering a new investment. The males seeking capital made a full presentation, using overhead slides, brochures and prototypes. When a woman proposed the same concept with the same presentation, respondents seemed to seek confirmation that she possessed the skills and traits required to ensure the success of the business.

Entrepreneurs have traditionally been seen as lone warriors, possessing a set of masculine skills such as aggressiveness, independence, competitiveness and risk taking. A subtle inclination to discount a woman’s ability to take on this role may discourage her from pursuing venture capital in the first place.

Your goal of starting a new internet venture in today’s digital world is perfectly timed. As internet devices merge with enterprise mobility, the market is growing so fast that Gartner, Inc. forecasts there will be over 20 billion connected devices by 2020.

Informal avenues of support, such as crowdfunding and social media, are playing a vital part in getting new ventures off the ground. Resources like Kickstarter have changed the game for women. Funding for a business idea comes from anyone willing to pledge a little money to a project, not just the big players at venture capitalist firms. According to reports, women are 61% more likely to reach their goals for financial backing than men on Kickstarter.

Eliminating the need for stereotypical balances, redefining definitions of entrepreneurship, and embracing alternative methods of financing will all help to balance the scales for women in business.

I never dreamed about success. I worked for it… Estee Lauder.

John Regan is a former Director of Sales for equity research.