GEM 2014 Women’s Report: Progress Presents New Opportunities
Today’s release of the 2014 GEM Global Women’s Report heralds an increase in entrepreneurial activity among women across the globe. In the 83 economies studied, more than 200 million women entrepreneurs are starting or running new businesses. An additional 128 million are running established businesses. The gender gap between women and men participating in entrepreneurship has narrowed by six percent since 2012. In fact, in several countries, women now are as likely, or even more likely, to be entrepreneurs than men. Women entrepreneurs in nearly half of the surveyed economies are now equal to, or even outpacing their male counterparts in terms of innovation – demonstrating a growing parity between men and women selling products and services that are new to consumers and not generally offered by competitors.
In celebrating this remarkable growth in entrepreneurial spirit and success by women across the globe, we need to think creatively about the kind of support we can provide to both new and established women entrepreneurs. The report reveals high rates of early-stage entrepreneurial activity by women who know other entrepreneurs. Affiliations with established entrepreneurs can offer role models, advice, contacts, and support, which may explain why economies with many women who know entrepreneurs are also likely to have high female startup rates. High rates of early-stage entrepreneurial activity are also present where women hold strong perceptions about the presence of opportunities for starting a business. The gender difference for this indicator is relatively narrow (40 percent for women versus 45 percent for men), and in some cases, women are slightly more likely than men to perceive good business opportunities.
At Babson’s Center for Women’s Entrepreneurial Leadership, we see this as a two-sided opportunity. We need to continue to support and inspire new women entrepreneurs, but also motivate those women in established businesses who can engage with and support new business opportunities. U.S. women entrepreneurs demonstrate among the highest rates of activity (11 percent) in the developed world and account for nearly 36 percent of all U.S. businesses, yet at the same time, companies with a woman CEO receive less than 3% of all venture capital dollars in the US. To address this need, we have partnered with Breakaway, a brand capital firm, to present the Babson Breakaway Challenge.
The Babson Breakaway Challenge is a competition and mentoring program that promotes gender parity and champions both women entrepreneurs and aspiring venture capitalists. The Challenge finalists – six start-ups and six venture capital apprentices – receive six weeks of intensive mentoring from top thought-leaders, and the program culminates with a final pitch showcase in March 2016. Breakaway will award the winning startup with $250,000 in funding and a brand identity platform, as well as extend a summer internship offer to the top performing venture capital apprentice. The Babson Breakaway Challenge takes an innovative approach to the traditional business plan competition by focusing on the problems faced by both sides of the funding equation: exceptional women entrepreneurs who need funding, and exceptional women venture capitalists able to fund them.
Investing in both women entrepreneurs and women venture capitalists will have an exponential effect on gender parity across the economic landscape. As the GEM report highlights, the rate of female entrepreneurship activity increases significantly with greater parity in economic participation. This indicates that the more women participate in the economy, the more likely they are to be entrepreneurs. By addressing the gender gap in venture capital, the Babson Breakaway Challenge builds on the findings of the GEM report – furthering the already inspiring progress of women entrepreneurs around the globe and celebrating the ideas of a new generation of entrepreneurial leaders.