1 in 3 high-growth companies are now run by women, despite a global lack of access to capital

According to the Global Entrepreneurship Monitor (GEM)’s 2021/2022 Women’s Entrepreneurship Report, one-third of high-growth companies worldwide are now run by women.

“This is an important statistic,” said GEM executive director Aileen Ionescu-Somers. “This shows what women can definitely achieve in the toughest aspects of entrepreneurship.”

The report defines high-growth companies as job-creating companies with 20 or more employees that anticipate creating 20 or more jobs over the next five years.

Produced by a consortium of universities, the GEM report constitutes one of the most comprehensive bodies of current data on entrepreneurship worldwide. The report on women entrepreneurs looks at data from 47 countries. Includes high-income countries (Canada, Chile, Japan, Saudi Arabia, South Korea, Uruguay, United States, etc.), upper-middle-income countries (Belarus, Brazil, Colombia, Jamaica, Romania, Russian Federation, South Africa, etc.). and Turkey); her one in low-middle-income countries (eg Egypt, India, Iran, Morocco) and low-income Sudan.

Women’s Entrepreneurship Report also revealed that one in three innovation-driven entrepreneurs is a woman. According to the report’s authors, female entrepreneurs in upper-middle income countries are now the most prevalent of the world’s most innovative and high-growth entrepreneurs, reaching parity with men when it comes to international market focus. I’m here.

At the same time, the report also found that women were more likely than men to start businesses without employees. This is the largest group of companies and is often a stepping stone for future job creators.

Women thrive in these areas with little or no ‘enabling’ environment, meaning policies that support childcare and other services that support women entrepreneurs. According to national-level experts who worked with the researchers, the “enabling environment” for women entrepreneurs in most countries is “very low”. tend to be less wealthy and have less of their own money available, the report found.

Globally, the number of women who said they wanted to start their own business or acted on it has declined in recent years, but the situation was different in upper-middle-income countries. There, her startup rate jumped 11% from 2019 to 2021, with no decline in 2020.

The presence of women at the helm of so many high-growth companies is especially notable given the extra demands many women faced during the pandemic.

“Of course, especially early-stage entrepreneurs were affected. There were a lot of business failures,” says Ionescu-Somers. “Women, who were already more established entrepreneurs, were able to navigate this challenge of suddenly not being able to care for their children.”

The report points out that one of the biggest challenges for women entrepreneurs exists around the world. I’m short of funds. “The main conclusion is that diversification of access to capital is relentlessly absent,” she says Ionescu-Somers.

Ionescu-Somers said one reason access to financing is limited is that many women are drawn to sectors where investors are less likely to back them. “Obviously, there are women in high-growth sectors, but women tend to opt for a different kind of entrepreneurship than men,” she says. “They tend to branch out into retail, hospitality and other areas.”

The report calls for mobilizing financial support for women entrepreneurs. Supporting high-potential women entrepreneurs in all sectors and countries. Celebrating women entrepreneurs as role models and ranting about gender stereotypes associated with entrepreneurship.

“For years we have argued that there is a cultural and societal bias against women,” Ionescu-Somers said. “Obviously there are role models. is reality.”

As more women make successful exits, they may invest in other women-owned businesses as well. The report found that the business exit rate for women rose from 2.9% to 3.6% during the pandemic, while for men it rose from 3.5% to 4.4%. In upper-middle-income countries, female turnover increased by 74% compared to her 34% for men.

The report also highlights some interesting regional trends.

· Only 12.9% of women in high-income countries reported their intention to start a business, compared to one-third of women in low-income countries. The report found that early-stage startup activity typically accounts for about half of intentions to start a business.

· The Dominican Republic had the highest rate of female entrepreneurship. Nearly 44% of her females reported startup activity, compared to 40.1% of her males.

· Poland (1.6%) and Norway (1.7%) had the lowest female startup rates.

· Entrepreneurship in the Middle East and Africa is becoming more accessible to women. “These societies are open not only to entrepreneurs, but especially to female entrepreneurs,” she says Ionescu-Somers.

· Women in Central and East Asia have the highest rates of established business ownership in the world. Kazakhstan shows the highest proportion of both entrepreneurial intentions and entrepreneurial activity by women.

· Europe has the lowest female entrepreneurship and participation rates.

The lead author of the Women’s Entrepreneurship Report is Dr. Amanda Elam, CEO/Co-Founder of Galaxy Diagnostics, an early-stage medical diagnostics company in Research Triangle Park, North Carolina, and Research Fellow of the Diana International Research Institute. She is at Babson College. Other contributors are:

Dr. Benjamin S. Baumer, Smith College

· Thomas Schott of the American University of Cairo, the University of Agder and the University of Southern Denmark

· Martha Samsami, University of Santiago de Compostela

· Dr. Amit Kumar Diwivedi.Indian Entrepreneurship Institute

· Dr. Rico Valdeger, Western University of Applied Sciences and Arts, Switzerland

Dr. Maribel Guerrero, Arizona State University and Desaroro University

Fatima Boutaleb, PhD, Hassan II University, Casablanca, Morocco

· Karen D. Hughes, PhD, University of Alberta, Diana Research Fellow, Babson College.

As many studies have shown, women’s economic empowerment benefits society in many ways. Creating a better funding ecosystem for women entrepreneurs seems like a logical step for policy makers looking for something easy to achieve to improve GDP and the well-being of the community as a whole. .