When there is a debate about the difference in the sexes in entrepreneurship, the question that often comes up is whether there is equality in opportunities in funding and growth.
According to a 2004 survey by the National Foundation for Women Business Owners in the U.S. about half of all small businesses are owned at least 50% by women. This is a 20% increase from the numbers in 1997.
Research in the U.S. banking industry does indicate discrimination against women. This is seen in instances where they were charged higher rates of interest as compared to men entrepreneurs. I would like to see the justification for this, this smells of pure and simple sexism.
However this was not found to be the case with angel capital or private equity funding. A recent paper on angel funding in the Journal of Business Venturing, by business school professors, Jeffrey Sohl, of the Whittemore School of Business and Economics at the University of New Hampshire and John Becker-Blease, of Washington State University studied how women were able to get angel funding.
While the research showed that women received lesser angel funding, it was simply because fewer number of women applied for private-equity funding. The authors revealed that during the study 13.3% women owned business ventures received angel funding as compared to the 14.8% of men who were working on start-ups.
This all said, it would appear that woman spend their money more wisely, which surely means lower risks for the investors and banks. This in turn should result in lower interest rates – as banks lead us to belief they are assessing the risk involved in borrowing – and not just help themselves to our money?
Comparing service and interest rates of banks must be high on the priority lists of every small business and start-up business, like SOHO-, SME, SMB-, Micro-, Lifestyle-, Home-, DIY-, Hobby-, Boomer-, Professional-, Personal businesses.