Passion to Action: 5 Ways to Know if You’re an Entrepreneur
Issue 60 — August 6, 2018
Do you dream of starting your own business?
You’re not alone, whether you are a woman contemplating leaving salaried employment you don’t love for the uncertainty of entrepreneurship, you want your own business so you can control your schedule to take care of family obligations, or you simply embrace the challenge of starting a new business and have done so once or more already.
“If you really want to fly,” says Oprah Winfrey, “just harness your power to your passion.” Many women are doing just that.
In fact, the raw numbers are astonishing.
According to Loretta McCarthy, managing director of Golden Seeds, an early stage investment firm that focuses on women-led businesses, women are starting businesses in record numbers. Women-owned businesses are now 39% of the total in the U. S. The growth rate amounts to 1000 per day or over 300,000 new female entrepreneurs each year. Women-owned businesses in the US grew by 114% compared to 44% overall in the two decades from 1997–2017.
Firms owned by women of color grew at more than four times that rate (467%). Three segments had an even higher growth rate than the combined rate for minorities: African American (605%), Native Hawaiian/Pacific Islander (493%), and Latina (491%). The Asian American and Native American/Alaskan Native segments also had higher rates (314% and 201%, respectively) than the overall average, as reported in American Express Open’s annual “State of Women-Owned Businesses.”
I’ve been reading up on women and entrepreneurship to prepare for my August 8 Virtual Happy Hour. I’m super excited about it because I’ll get to interview two extremely talented and successful entrepreneurs.
My guests will be Nathalie Molina Nino, who started her first business at age 20 and is now the founder and CEO of BRAVA Investments, and Nina Vaca, founder, chairman, and CEO of the Pinnacle Group, one of the largest providers of IT workforce solutions and recently named the Fastest-Growing Women-Owned/Led Company in the US, by the Women Presidents’ Organization.
The News About Female Entrepreneurs Isn’t All Rosy
I want to see the female entrepreneur equivalent of Bill Gates as part of my personal mission of achieving leadership gender parity in my lifetime.
Yet, even though this BCG study calculated that VCs could have made an additional $85 million over five years if they’d just invested equally in both the female- and male-founded startups, significant disparities make it difficult for women to create businesses generating wealth at the level of Microsoft or Amazon or Apple’s recent $1 trillion valuation.
Let’s face it: Women face implicit biases when they seek loans or investment dollars to fund their startups, and thus are less likely to get venture funding and capital investment than men. Those external barriers are real and must be addressed. In 2017, of the 61,560 companies that received funding, just under one-fourth were founded or led by women.
The numbers in venture funded companies are astonishingly disparate. Not surprisingly, women make up only 8% of partners in those firms. The chart below illustrates the clear correlation between the percentage of angel backed companies led by women and the percentage of female angel investors. The importance of women taking the lead, as it were, to invest in women in order to level the playing field is obvious.
That said, it’s also the case that women on the whole also are inclined to think smaller and ask lower than men. We have to fix that part of the equation ourselves. Carnegie Mellon professors Linda Babcock and Sara Laschever found that women worked 20% longer for 10% less than men.
Implicit bias does things to our heads that results in self-limitation and lower levels of self-confidence. One consequence is that women tend to be more risk averse than men. While that’s an asset in some roles, it’s a liability for entrepreneurs.
It’s incumbent on women to help each other self-advocate more and learn to both appreciate our worth and ask for/expect to get it. We must put our investments where our passion is. And if you are considering starting a company, here is your encouragement to do so.
What Is an Entrepreneur?
Molina Nino, whose forthcoming book Leapfrog: The New Revolution for Women Entrepreneurs will be released August 28, told me that an entrepreneur is “an imaginative artist with a high tolerance for risk, little patience for the status quo and an unreasonable passion for problem solving. An entrepreneur is happiest straddling the world of abstraction and pragmatism and is compelled to work in collaboration. Not to be confused with an inventor or a solopreneur, a true entrepreneur is driven by the need to take collective action, leveraging the power and potential of a cohesive team. An entrepreneur is by design, a malcontent and a contrarian, unwilling and perhaps unable to walk away from a problem she knows she can solve better, faster, cheaper or more humanely. Finally, an entrepreneur is flexible, and persistent. In other words, a honey badger.”
And here are 5 ways to know if you are suited to be an entrepreneur:
1. You’re not merely comfortable with risk. You have a high tolerance for risk and are willing to accept high levels of responsibility in order to have the opportunity to start an enterprise.
2. You have a healthy appetite for asking. And you have the empathy and willingness to connect with people who can help you fund, advise, and provide the skills you need. You can handle rejection, which will happen a lot. And you are willing to get the skills to ask effectively.
3. You have a vision for how to solve a problem and the ability to translate vision to execution. Clarity of intention is crucial. Greg Larkin, author of This Might Get Me Fired, advises, “Never pitch an idea. Always pitch an outcome.”
4. You are likely to have more courage than confidence. The way to begin is to begin, as Eleanor Roosevelt was fond of saying. You have a bias toward action and a willingness to act even if you are scared silly.
5. You have that honey badger persistence that Molina Nino mentioned. You’ll go over, under, around, and through problems and barriers. You care enough to make it happen.
And here’s a bonus Number 6. It’s what I believe — that everyone is an entrepreneur. The five qualities I’ve listed are useful in whatever endeavor you choose. For example, I’ve spent my career leading nonprofit/social profit organizations, and I consider myself quite entrepreneurial. Take The Lead is my first start up.
Everyone is creating the business of her own life in any case. So the real question becomes whether you are more comfortable, happier, and more successful by your own measures starting an enterprise or working within one that has already been started.
Only you can make the judgment call about how you want to harness your power to your passion, and fly.
Register here for the Virtual Happy Hour, Wednesday, August 8 at 6:30 pm eastern time to continue this conversation. You’ll be able to ask these two remarkable women your burning questions, and if you register and it turns out you can’t attend live, we’ll send you the link later so you don’t miss any of it.
GLORIA FELDT is the New York Times bestselling author of several books including No Excuses: 9 Ways Women Can Change How We Think About Power, a sought-after speaker and frequent contributor to major news outlets, and the Co-Founder and President of Take The Lead. People has called her “the voice of experience,” and among the many honors she has been given, Vanity Fair called her one of America’s “Top 200 Women Legends, Leaders, and Trailblazers,” and Glamour chose her as a “Woman of the Year.” As co-founder and president of Take The Lead, a leading women’s leadership nonprofit, her mission is to achieve gender parity by 2025 through innovative training programs, workshops, a groundbreaking 50 Women Can Change The World immersive, online courses, a free weekly newsletter, and events including a monthly Virtual Happy Hour program and a Take The Lead Day symposium that reached over 400,000 women globally in 2017.