Can women entrepreneurs help save the US economy? YES!

Entrepreneurs are arguably the most important actors in our economy—the creators of new wealth and new jobs, the inventors of new products and services, and the revolutionizers of society and the economy
~ Lesa Mitchell, VP of advancing innovation at the Kauffman Foundation.

I have been reading a great deal recently on how small business and entrepreneurship is the potential savior of our US economy. Economist will agree that older established companies DO NOT hold the promise of job creation or a renewed and revived economy, but instead the next bright new companies.

Venture capitalist will tell you that EVERYONE is on the lookout for the next “Gazelle” or fast growing start-up with the potential of becoming the next Google or Apple. But in between the “Giants” and the “Gazelles”, lies a whole territory of smaller companies that also help to fuel the economy not only by job creation but by private wealth creation, smaller companies from yoga studios to e-commerce web portals.

How important is entrepreneurship to the US economy?

This is where the jobs are, not at General Motors. It is about creating new companies, new industries, not propping up behemoths
~ John Harthorne, a co-founder of MassChallenge

The US Government has identified entrepreneurs as an important key to turning the economy around, and in January of this year The White House helped launch the Startup America Partnership. This is an independent, private-sector entity partnership between the US Government and private equity. The US Government is committed to matching funds in this venture to encourage the creation of new startups, with a principal focus on supporting existing firms who could become “Gazelles”.

How do Women entrepreneurs stack up?

As the chart above from the Kaufman Foundation indicates, not so great. In fact, American Express OPEN report for 2011 found that just 1.8 percent of women-owned firms had revenues of more than $1 million, while men-owned firms was 6.3 percent. 

In the new study by the Kaufman Foundation, OVERCOMING THE GENDER GAP: WOMEN ENTREPRENEURS AS ECONOMIC DRIVERS, has shown that although nearly half of the workforce and more than half of our college students are women, their lag in building high-growth firms has become a major economic deficit.

Facts about women startups:

• Average revenue of men’s firms was $120,000 versus about $60,000 for women. 
• Women owned firms account for 29% of all enterprises.
• Women-owned firms only employ 6% of the country’s workforce and contribute just under 4% of business revenues . 
• WOMEN ONLY account for 35 % of the people who start a businesses.

Estimated that there are over 8.1million women-owned businesses in the US, generating nearly $1 .3 trillion in revenues and employing nearly 7 .7 million people – IMAGINE THE UNTAPPED ECONOMIC POTENTIAL OF WOMEN ENTREPRENEURS!!! 

We must consider fostering women’s entrepreneurship as an economic issue, not a gender-equity based issue. Simply put – we are missing a BIG chunk of this country’s educated brainpower. 

OK great, but what kind of support is there out there?

Business incubators are service programs, not buildings,” “No building can grow companies, provide mentoring and handholding, and assist an emerging company in meeting the benchmarks necessary for growth.
~ Dinah Adkins, president and CEO of the National Business Incubation Association (NBIA). 

Besides the SBA and the Startup America Partnership, consider joining an incubator or accelerator program in your area, according to Bloomberg Businessweek there are about 50 accelerators altogether seeking more than 500 startups for their programs this year, and surprisingly not all of these are for the tech sector.  Studies show that start-up ventures that graduate from an incubation or accelerator program have a success rate of 87%, compared to 44% for all other firms. 

Here are 20 incubators and accelerator programs in the US. This list is in no particular order or ranking. In order to figure out the best fit, do your research and talk to to people about their experiences during the program and ask for success, funding figures for the overall program and finally what will their stake be in your company and how will they help you with management.

1. Astia, Astia offers programs for women run high-growth start-ups.
2. Women 2.0 – Pitch, not a traditional incubator.
3. West Enterprise Center, Albuquerque, N.M.
4. Mi Kitchen es su Kitchen,  New York, N.Y. focused on food businesses.
5. DreamIt Ventures, Philadelphia, PA
6. Georgia Tech’s Advanced Technology Development Center, Atlanta, GA
7. Launch Pad Ignition, New Orleans, LA
8. SENO – Social entrepreneurship, New Orleans, LA
9. TechStars, accelerators (Boston, Boulder, New York City, and Seattle )
10. MassChallenge, Boston, MA
11.  Y Combinator, Silicon Valley, CA
12. NYC SeedStart, New York, NY
13. Santa Fe Business Incubator, Santa Fe, NM
14. Accelerator Corp., Seattle, WA – biotech startups
15. Long Island High Technology Incubator, Stony Brook, NY
16. The Shoals Entrepreneurial Center - Florence, AL
17. Innovation Depot, Birmingham, AL
18. LaunchBox Digital, Washington, DC
19. Metro Tech, Oklahoma City, OK For Latino entrepreneurs.
20. Plug and Play Tech Center, Sunnyvale, CA 

These incubator and accelerators are the promise of growing new businesses, as traditional Venture Capital is becoming scarcer. Consider that there were fewer initial public offerings of firms backed by venture capitalists than in any year since 1985, and that the proportion of IPOs worth less than $50m has plunged to 20% in the past decade. This matters, because according to the National Venture Capital Association over 90% of job creation by venture-backed firms occurs after they go public. 

With few answers on how to turn this economic mess around, we must consider how to foster the entrepreneurial sector, specifically the untapped economics of women entrepreneurs. 

Related posts:

1. Facts About Women-Owned Businesses
2. Listen and Learn from Women Entrepreneurs in IT
3. Where are the opportunities in the “New Normal” economy
4. Inspiring Women Series – Female Internet Heros
5. Reasons to start your startup in a bad economy