Next Stop: The Top Rungs
For women in executive roles, one way to break the glass ceiling is to wield a hammer and do it through a combination of will, business skill, managerial competence and determination.
Another way, it seems, is to own that ceiling.
According to an annual study performed on behalf of American Express, female ownership of businesses in the United States rose 50 percent faster than the overall rate of business creation between 1997 and the start of this year. It determined that 9,087,200 U.S. companies are either majority-owned by women or owned outright by women, and that in addition to supporting the owner, those companies had 7,854,200 employees and annual revenues of $1.41 trillion.
“There are a lot of efforts under way to measure the impact of women as owners,” says CiCi Rojas, chief executive officer for the Central Exchange, an organization that promotes the interests of women in business. “There are not necessarily as many glass ceilings anymore; people are finding work-arounds, and don’t view them that way as much. Once they’ve become a scalable owner, the only obstacle is themselves.”
The challenge for most women-owned enterprises, business analysts say, is that they disproportionately are one-woman shops; because so many of them have no employees, their potential for growth is limited by the ability of the owner to generate revenue on her own. But that, too, appears to be changing, according to the Growing Under the Radar study, particularly when you explore the levels of hiring and revenue generation that fall along racial lines under female owners:
Factors contributing to women’s success as owners, experts say, are the same as those that define successful executives at larger corporations: They are generally regarded as more collaborative and better team-builders, they tend to be more efficient with capital; they more readily embrace diversity, and they understand other women, who control or influence a whopping 80 percent of consumer purchases.
Minority women, and women in general, are not alone in reaping the benefits of business ownership. Carlos Gomez, president and CEO of the Hispanic Chamber of Commerce of Greater Kansas City, says Hispanics are increasingly drawn to business ownership, whether they are native citizens or immigrants to America.
That’s what’s driving the trend lines found, for example, in an Small Business Administration report that said ownership of businesses among racial and ethnic minorities rose by more than one-fourth in just five years—from 11.5 percent in 2007 to 14.6 percent in 2012.
“We are seeing a lot of businesses starting up, and that’s a national trend,” said Gomez. “But we’re seeing more and more coming to us for assistance for their startups this is my eighth year with chamber, and this is hands-down the most interest we’ve seen from people opening up businesses.”
Those businesses, he said, are mostly service-oriented, whether that involved an IT company or a tree-trimming concern. There’s substantially less activity in retail settings, in part because of a start-up issue that recognizes no ethnic differences: “One of the most consistent challenges, obviously, is access to capital,” Gomez said. “That’s the No. 1 question we get asked about.”
Christal Watson, president and CEO of the Kansas Black Chamber of Commerce, said she noted the same issues within her membership.
“For women and minorities, a lot of them are one-man shops,” she said, “so they do not have the resources to really grow themselves.” And even though some banks have dedicated programs to reach small business, those tend to target the largest employers—not unusual, since that’s where commercial customers with larger lending needs, stable finances and established client bases reside.
But other things are holding back growth, as well, Watson said. “Many times, a consumer doesn’t know that a small business is out there because they don’t market correctly, or they don’t use Google Adware or the other tools that can help people know you are there.”