Home LEADERSHIP Women in Leadership The Power of Women Entrepreneurs Across the World

The Power of Women Entrepreneurs Across the World

June 6, 2023

Women across the world sustain economies and innovation through entrepreneurship. More than 250 million women are entrepreneurs and over 150 million are leading established businesses. Research demonstrates that investments in women entrepreneurs lead to lower levels of global poverty, better lives for children, and greater creativity and innovation. Financial and non-financial investments in women are essential to growing the pipeline across the world.

Women across the world sustain economies and innovation through entrepreneurship.¹ More than 250 million women are entrepreneurs and over 150 million are leading established businesses. The highest rates of women entrepreneurship are found in sub-Saharan Africa and Latin America, where incomes are the lowest. The lowest rates are in Europe and the Middle East.² These women entrepreneurs are likely to be between 25-44 years of age and of moderate confidence compared to men, yet undeterred by fear of failure.³

Across the African continent, women account for 58 per cent of entrepreneurs and add 33 per cent to the continent’s gross national product.⁴ Botswana, South Africa, and Ghana are home to the highest numbers of women entrepreneurs in Africa and across the world.⁵ According to the World Economic Forum, women-led start-ups in Africa are just as, or more, profitable than start-ups led by men. Moreover, these start-ups drive women’s and girls’ empowerment and make considerable positive social impact across Africa.⁶ Despite these contributions, women entrepreneurs in Africa continue to earn less than men doing similar work. Black women across Africa also suffer from a $42 billion funding gap in terms of support for entrepreneurs, compared to men. The continent could achieve much greater success by investing in women and their businesses. According to a 2022 report by McKinsey, Africa could gain $316 billion in terms of gross national product by 2025 by bridging the gender gap as it relates to entrepreneurs. An investment in African women not only leads to stronger African nations, but also results in a higher quality of living for African families.⁷

Gender gaps and regulatory frameworks in Latin America make entrepreneurship difficult for women; only 35 per cent of women participate as entrepreneurs and in economic activity in Latin American countries.G However, these women continue to demonstrate determination. In some Latin American countries, women have some of the highest entrepreneurial activity ratings. Chile and Uruguay, for example, boast 1 in 5 women who want to start their own businesses. In Costa Rica, women entrepreneurs outnumber men in terms of starting businesses. Overall, women in Latin America have less access to capital financing than women entrepreneurs across the world.⁸ In order to make change for women, some Latin American countries are investing in acceleration programmes that will have an impact on the entire continent. Start-Up Chile is one of these public accelerators. To motivate and support women, the organisation launched The S Factory Idea, which is a “pre-acceleration diversity programme” for women business founders.⁹

Across Asia and the Pacific Rim, according to the International Finance Corporation, women own 50 per cent of micro-businesses and nearly 60 per cent of small and mid-sized businesses. Women in South Asia are less likely to own a business. They own roughly 10 per cent of micro-businesses and a mere 8 per cent of small and mid-sized businesses.¹⁰ ¹¹ Throughout Asia and the Pacific Rim, most women start businesses out of necessity. Those countries with the greatest growth in women entrepreneurs include the Philippines, Indonesia, Malaysia, and China. However, women could make considerably more progress if they had the same access to business loans and investment capital as men.¹² Most women entrepreneurs in Asia and the Pacific Rim are employed in the agriculture sector. They tend to lack access to the manufacturing sector. As economies develop, however, women gain more access. For example, women in Bangladesh often own businesses in the garment industry and, in Vietnam, women are gaining traction in the manufacturing sectors.¹³

The highest rates of women entrepreneurship are found in sub-Saharan Africa and Latin America, where incomes are the lowest. The lowest rates are in Europe and the Middle East.

In the United States, President Joe Biden and Vice President Kamala Harris have emphasised women’s entrepreneurship and support for more of it as part of their administration’s focus. Their efforts are aimed at “building strong professional networks and partnerships for women entrepreneurs to advance women’s business interests.”¹⁴ In 2019, for example, the Biden-Harris Administration – through the Department of State’s Economic and Business Affairs Bureau – launched Providing Opportunities for Women’s Economic Rise (POWER).¹⁵ Since its launch, POWER has worked with and benefited more than 42,000 women in over 30 countries and has resulted in more than 175 public-private partnerships with women in the lead.¹⁶

In the United States, 42 per cent of companies are owned by women; that’s four out of every 10 businesses.¹⁷ These women-owned businesses generate $1.9 trillion annually. Black-women-owned businesses are growing at the fastest rate – 50 per cent – among women-owned businesses. Native Hawaiian/Pacific Islander (41 per cent), Latina/Hispanic (40 per cent), Asian American (37 per cent) and Native American/Alaska Native (26 per cent) businesses grew at a slower rate than women of colour overall, but faster than women-owned businesses and businesses in general.¹⁸

Despite increased success, much like their counterparts across the world, women entrepreneurs in the United States receive less support for their innovations. According to a report by Bloomberg, women-led start-ups raise much less then men when securing venture capital funds.¹⁹ Specifically, women-led start-ups raise $77 million compared with $100 million for men-led businesses – a statistic that falls in line with the gender gap in salary in the country.²⁰ According to the 2020 US census, women make 82 cents to every dollar men make.²¹

To end the gap in terms of support and resources for women entrepreneurs, various organisations across the world are stepping up. For example, Cornell University’s Bank of America Institute for Women’s Entrepreneurship has enrolled over 50,000 women in its online certificate programme. Moreover, Bank of America recently added 50,000 spots in the programme. Of note, 90 per cent of the women enrolled in the certificate programme, which is the only online entrepreneurship programme at an Ivy League university, are women of colour.²²

Goldman Sachs’ 10000 Women offers another opportunity for women entrepreneurs throughout the world, with over 100,000 women from over 150 countries currently benefiting. The programme, which is online and free, provides women entrepreneurs with management education, mentoring, a network of other women, and access to capital to support their innovative ideas.²³ Highlights of the programme include the fact that 9 in 10 of the participants in the programme pay it forward by mentoring other women, and 60 per cent of the programme’s graduates create new jobs. Goldman Sachs started its programme after learning that there is a huge global credit gap for women-owned businesses, estimated at $1.5 trillion. Furthermore, research also demonstrates that closing the credit gap for women-led and owned businesses – especially in emerging markets – could potentially push annual family incomes roughly 12 per cent higher by 2030.²⁴ Focused on early investment, 37 Angels is a network of 50 women whose mission is to invest in “holistic entrepreneurial support for women.” The Angels choose eight companies six times a year and give them the opportunity to pitch their ideas for a possible investment of $50-150 per company.²⁵ In addition to giving to women entrepreneurs, the Angels also host a boot camp so that other women can learn the “art of angel investing.”²⁶ Angels 37 has three foci that are promising and unique: 1. to “shed light on the black box of start-up investing” for entrepreneurs; 2. to ensure clear and open communication with entrepreneurs; and 3. to “understand the highs and lows of business-building”.²⁷

There is much that can be done to support women entrepreneurs across the globe. As consumers, we can buy from women-owned companies and promote these same companies across social media. We can celebrate the success of women and create opportunities for women to have their voices heard. Another strategy for supporting women is to make introductions for them as they are starting out in business. Likewise, if we are women entrepreneurs, we can mentor other women, clearing a path for their success. Lastly, if we have access to capital, we can invest in women-owned companies, bridging the significant gap in the financing to which women have access.

Financial and non-financial investments in women are essential to growing the pipeline across the world. Research demonstrates that investments in women entrepreneurs lead to lower levels of global poverty, better lives for children, and greater creativity and innovation.²⁸ In the words of the late Nelson Mandela, “If you want to change the world, help the women.”

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This article was originally published on January 10, 2023.

About the Author

Marybeth Gasman is the Samuel DeWitt Proctor Endowed Chair and a Distinguished Professor in the Graduate School of Education at Rutgers University. She is the author 33 books, including Doing the Right Thing: How Colleges and Universities Can Undo Systemic Racism in Faculty Hiring (Princeton University Press, 2022).