If there’s one thing the world needs more of, it’s female business owners. But while the gender divide may be closing, many women are still put off by the idea of going it alone.
There are a number of reasons for this business apathy among women, from a lack of business education to the pressures and time constraints of motherhood, especially for single mums.
For some, there’s a common misconception that if a business is to fail, the financial impact could put the family at risk. Starting a business can seem daunting at first, but there’s so much help, advice and support out there to ensure your start-up is a success.
So what are the funding options are available to new female business owners?
Crowdfunding has revolutionised the financial element of starting a new business. Organisations like Kickstarter have given women the chance to start a business without the need for a high street bank loan.
The concept is simple: all a person needs is a good idea or invention that people are willing to buy into – crowdfunding works via public donations and pledges.
There’s no catch as such, but the conditions of crowdfunding often require a beneficiary to hit their full target before the funds become available.
Crowdfunding is also more effective when there’s an incentive. For instance, if you’re raising money for your gluten-free food business, you may offer a product hamper in return for funding.
The Start Up Loans Company is a government-backed scheme, which was set up in 2012 to boost the UK’s entrepreneurial spirit.
Start Up Loans’ main aim is to get more people to turning their passions and skill into a profitable business.
The organisation has made it possible for budding female business owners to obtain the funds and mentoring needed to start a company, through low fixed-rate interest personal loans for business purposes.
But funding is just one benefit of a Start Up Loan. The initiative also provides useful free advice and expert insight into all aspects of setting up a business, from cash flow forecasts to marketing campaigns.
Aside from crowdfunding and loans, women can also take advantage of the many government business grants that are available to new companies.
Grants are often awarded to businesses when there is a need for a specific company or invention i.e. if there is a shortfall of new UK businesses in the tech industry.
Current government grants and schemes can be found on the GOV.UK website, along with a full list of criteria for each grant.
Aside from Start Up Loans, there’s also the traditional route of obtaining a business through a high street bank.
The banks often require a cash flow forecast and business plan when loaning money for business purposes, this is to ensure a business is viable and that the repayments are likely to be met.
One thing to keep in mind is that interest rates often fluctuate between banks – loan comparison sites are an excellent way to determine who is offering the best deal.
There’s plenty of information available to women about penning a business plan or cash flow forecast online, including two very helpful guides on the Start Up Loans website.