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Sian Crookell from Capify looks at the barriers women still face in setting up their own businesses and suggests where they can go for advice and support.
A new study has revealed that 31% of women in the UK would be put off starting their own business due to fear of failure.
The survey, carried out by Capify, discovered the top barriers to entry for women looking to start their own business. 45% of women deem the initial start-up costs to be a significant barrier to starting their own business; 24% feel that they wouldn’t have a strong enough business idea; over 50% think that running their own business would be stressful; and 29% believe it would be scary.
Dr Karen Bonner, Lecturer in Entrepreneurship at Queen’s University in Belfast, said: “In general, we find that men are almost twice as likely to start a business than women in the UK. More men starting a business than women is also a feature of western economies. There are a range of reasons for this.
“Women do tend to face barriers in the form of access to finance, lack of professional networks, childcare issues, lack of role models and mentors. But there are also inherent characteristics such as lack of confidence in their skills to be entrepreneurs, compared to males, and also a more risk averse nature.”
However, despite only 1 in 3 UK entrepreneurs being female, many women feel that entrepreneurship could offer them something that full-time employment could not.
The survey revealed that 43% of women in the UK would enjoy the work life balance that running their own business would provide, while 29% of female respondents also said they’d find the process exciting.
The economic case for increased female entrepreneurship is clear, with projections estimating that up to £250 billion of value could be added to the economy if women set up businesses at the same rate as men. But what can be done to encourage more women to become entrepreneurs?
Dr Bonner says: “More female mentors and role models, who have been in the same position, may help with regards to giving women the confidence to start up. Likewise, financial institutions could seek to provide alternative sources of funding which are more flexible in nature. In general, the provision of information and networking opportunities for women would also help overcome these barriers.”
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According to our survey, only 5% of 18-24-year-old women would be willing to start a business, demonstrating that age plays a factor in entrepreneurial confidence, too. Aside from a fear of failure, low self-esteem could be seen as playing a role in younger demographics.
In an Alison Rose Review of Female Entrepreneurship, low self-esteem and less access to start-up capital were cited as significant barriers to entry. The review also revealed that only 39% of women are confident in their capabilities to start a business, compared to 55% of men. However, this is a perceived gap in ability, rather than an actual gap in skillsets.
There are several organisations in the UK which have been created to encourage women to become entrepreneurs. Once such organisation is the Female Founders Academy, connecting women with experienced mentors to provide guidance and confidence.
The academy has also launched three programmes for budding female entrepreneurs at each stage of their journey. The Launchpad programme is for new ideas and is accepting applications for the next cohort until February 2020. Additionally, the incubator and accelerator programmes are both designed to facilitate growth and support to female-led businesses that are trying to scale up.
Another useful organisation is Blooming Founders. Blooming Founders creates environments, events and content that assists ambitious women in building scalable and impactful businesses. This organisation is specifically designed to help early stage female entrepreneurs and diverse teams succeed.
For women at the very beginning of their journey, keen to know more about the ins and outs of launching a start-up, how to create business plans and ways to generate income, Prowess has countless guides and resources which are presented in a clear format and are easy to digest. This female-friendly hub is full of stories and shared experiences from women who’ve made their own way in business.
With the right support and resources, there’s no reason why female entrepreneurship can’t reach the same levels as male start-ups. While there are different barriers to entry between the two sexes, both perceived and real, tailored programmes to encourage success could have huge, lasting impacts on both personal fulfilment and wider economic growth.
*Sian Crookell is a Marketing Campaign Manager who has been working at the alternative business finance company Capify, for five years.