As the “era of entrepreneurship” powers on, a new trend has started to emerge: women, entering the entrepreneurial world in increasing numbers, now own over 36% of all U.S. businesses.
With the rise in female business mentors and role-models, economists and investors predict the coming of a new era: that of the female entrepreneur.
But for women, finding success in the business world can prove difficult. The inherently social nature of the business start-up means gender stereotyping can be a deal breaker: whether it be appealing to investors or networking with other entrepreneurs, women are tasked with engineering a persona that is masculine enough to be taken seriously, and feminine enough to not be too threatening.
Companies with strong female authority generate higher returns on equity, stronger stock performance, and higher dividend payouts.
In spite of this disheartening sexism, women have had continued success that makes a strong case for the predicted crumble of entrepreneurial gender disparity. In fact, researchers have found that female-led companies out-perform those that are led by men:
Reports from research/analytic firms MSCI and Credit Suisse reveal that companies with strong female authority generate higher returns on equity, stronger stock performance, and higher dividend payouts. And, according to The 2015 Kauffman Index: Startup Activity, female entrepreneurs are better at finding, and capitalizing on, gaps in the market.
Even while pitted against the sex currently dominating the playing field, businesswomen, in typical entrepreneurial fashion, would not take no for an answer.
As female entrepreneurs adapt to their surroundings, they’ve had to tweak the standard model of business success. Rather than waiting for society to change, women have learned how to game the system using a few basic concepts.
Recognize, and Eliminate, the “Confidence Gap”
Recent studies have shown that, for a shocking majority of women, leadership skills and self-confidence are either not taught or are discouraged entirely. In a study sponsored by big-four accounting firm KPGM, two-thirds of women said they were hesitant to share their ideas in the workplace or pursue a leadership position, and over 50% said they were never taught leadership skills in childhood. This lack of confident female role-models in leadership positions is commonly referred to as the confidence gap.
Because entrepreneurial success is so highly dependent on a person’s social aptitude, a firm belief in your abilities and ideas is key. An honest, realistic self-confidence is what will convince other people to believe in you. It will push you to take risks, and to strive for what it is you know you can achieve.
For female entrepreneurs, learning to be confident is especially important. One study, published in the Social Forces scientific journal found that when men and women pitched the same idea (with the idea being considered either “innovative” or “non-innovative”) to potential stakeholders, the women were rated less competent by stakeholders when compared to their male counterpart. Unfortunately, these are not isolated results, and mirror several studies done on gender bias in the business world.
In light of this, it is imperative that women acquire genuine self-confidence. Being in a workplace where your competency is immediately questioned necessitate mental-toughness and faith in your abilities.
Self-awareness is a major determinant of any entrepreneur’s success- it dictates whether or not your confidence will be perceived as genuine, and governs how positive the response to your ideas will be. But 8 years of research from Stanford GSB’s Olivia O’Neill suggests that the concept of self-awareness holds a little more weight for female entrepreneurs.
Masculinity in women (defined, in the study, as exhibiting an increased confidence/aggressiveness) was most effective when toned down, and appeared more open to a communal approach. Rather than being seen as aggressive and attacking, the self-aware women were assertive, but without being threatening.
These self-aware, “masculine” women received three times more promotions than masculine women who were not self-aware: but, more impressive, 1.5 times more promotions than masculine men, regardless of their self-awareness.
These results imply women must craft a different kind of authority- some women have called it the “third gender”- but that may be what propels them further than their male co-workers.
Take on the “Third Gender”
Since neither of the gender stereotypes- feminine or masculine- have been advantageous to female entrepreneurs, women have developed a necessary adaptation. Rather than being aggressive in their leadership or pursuit of funding/success, women must have the same confidence and drive, but without the aggression. Rather than making others feel like they are being attacked (or emasculated), accomplished, female entrepreneurs assert their opinions in ways that don’t put others down, or devalue their contributions.
Additionally, learn to use “femininity” to your advantage. In the KPMG study of leadership qualities previously mentioned, women were found to value personal growth and constructive criticism in their business ventures more highly than men, and tended towards a more collaborative business approach.
“The challenge in most organizations is to innovate and adapt. An autocratic style doesn’t serve that. You need different perspectives at the table from diverse backgrounds.”
And with that humility comes reward: taking advice and valuing new ideas is what helps a business stay perpetually relevant. KPMG chief executive Lynne Doughtie notes that “the challenge in most organizations is to innovate and adapt. An autocratic style doesn’t serve that. You need different perspectives at the table from diverse backgrounds.”
Gender bias maintains an undeniable presence in the entrepreneurial world, and its horror stories signal a desperate need for change. But the future is bright for female hopefuls: with some reworking of the current structure of things, women can- and do- thrive in a field where all the odds are against them.