SACRAMENTO, Calif. — When it comes to entrepreneurship and business ownership, women remain underrepresented across the country. Of the 33 million small businesses, nearly 13 million of them are women-owned and most are run by white women, accounting for 82% nationwide.
According to the latest data from the U.S. Census Bureau, California has the highest number of Hispanic and Asian American women-owned firms. California also has the fifth largest number of businesses owned by Black women.
Despite slight growth overtime, women entrepreneurs and small business owners still face many challenges on the path to business success and economic independence.
The U.S. Senate Committee on Small Business and Entrepreneurship released a report in July highlighting some of the obstacles women entrepreneurs and small business owners face. That includes:
- Access to capital, and particularly to venture capital that could make a small business the next great American business
- Childcare access and affordability
- A gap in mentoring opportunities that could help women start their journey to entrepreneurship or advance their business interests.
Cyndee Paulson-Heer is the co-owner of The Journaling Studio in Sacramento. She offers hand-crafted journals and planners to the public. She says she became an entrepreneur to help make a positive change.
"I lived at a time where women barely had a voice," said Paulson-Heer. "For women, it is about us putting our voice into our work. My voice is in everyone of one of these covers and quotes in the journals."
Cyndee says women in business also struggle with "being taken seriously."
Kiki Magnuson, agrees. She owns a remote nutrition coaching program called "Living Well with Kiki." She says equitable access to marketing tools for women-owned small businesses can be tough, too.
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"I've been told that I'm too young to have my own business," said Magnuson. "I do not get as much visibility as other companies that have bigger names, so it is an ongoing battle."
Dominique Birdsong owns Ziva Naseer who offers luxury handmade bags. She says women entrepreneurs, especially women of color, need more support to succeed long-term.
"The biggest challenge is capital and funding," said Birdsong. "Historically, the lack of funding has diminished the longevity of businesses owned by women of color. We may have funding in the beginning, but to grow, you have to have the inventory to grow, which takes funding and capital. I want to be here 100 years from now. Even if I'm physically not, I want my business to be here 100 years from now."
When it comes to addressing the challenges women entrepreneurs face, The U.S. Senate Committee on Small Business and Entrepreneurship report recommends action in policy. That includes:
- Make Permanent the Community Advantage Program: Senator Cardin (D-MD) has introduced legislation to codify the Community Advantage program for several Congresses. The Community Advantage Pilot Program was established by the SBA over ten years ago to address the credit gap in underserved communities and has become an important complement to the 7(a) program. The program utilizes mission-oriented lenders, including Community Development Financial Institutions (CDFIs) and Certified Development Companies (CDCs), to make help fill capital gaps, as well as provide business support services and technical assistance. On July 19, 2023, the Senate Small Business and Entrepreneurship Committee passed out of Committee a bill to codify the CA program. It is imperative for underserved entrepreneurs that this bill becomes law.
- Invest in Universal Childcare: Affordable, accessible, and quality childcare is cited as the leading barrier for women seeking to join or rejoin the workforce, advance at their jobs, or start their own business. The U.S. is in the midst of a childcare crisis, with its economic impact doubling since 2018 to 2022 resulting in $122 billion annually in lost earnings.57 Women unduly face the burden of picking up where the government has failed them, resulting in more women leaving the workforce to take care of their families. Additional investment is needed to ensure America’s children receive the early childhood education to help them develop and to allow women the freedom of professional choice.
- Enact the Women’s Business Center Improvement Act of 2023: Introduced by Senator Cardin (D-MD), the Women’s Business Center Improvement Act of 2023 would modernize and strengthen the SBA’s WBC program. The legislation would raise the funding cap from $150,000 to $300,000, ensuring WBCs have more resources to meet the needs of women small business owners. The legislation would also mandate the creation of an accreditation program for WBCs so that they are able to offer quality service to women small business owners and entrepreneurs across the country. The legislation also authorizes $31.5 million for each fiscal year from FY 2024 to FY 2027. Passage of this legislation is vital to ensuring women-owned small businesses have access to the mentoring, counseling, and training they need to succeed.
- Enact the SCORE for Small Business Act of 2023: Introduced by Senator Coons (D-DE), the SCORE for Small Businesses Act of 2023 would modernize and improve the SBA’s SCORE program. The legislation would also increase Congressional oversight of the program to make sure that mentoring services are being effectively and efficiently delivered. Passage of this legislation would strengthen SBA’s only direct business mentoring program to ensure that SCORE can meet the needs and diversity of America’s 21st century entrepreneurs.
- Improve Small Business Contracting Counting: Double counting makes it easier for agencies to “meet” their small business contracting goals, but it is a disservice to the small business owners interested in contracting with the federal government. Benchmarks have been set to expand opportunities for small business contractors, particularly women and minority contractors. Double counting allows agencies to skirt the intent of Congress’ establishment of benchmarks by awarding one contract to one business that satisfies more than one goal when they could have awarded multiple contracts to multiple small businesses to satisfy multiple goals. Congress should look to address agency double counting across small business contractors to ensure that opportunity is being equally distributed and to get a more accurate representation of small business goals.
You can support women-owned businesses by going to the California Women's Festival Sunday, Aug. 26 at Cal Expo from 9 a.m. to 2 p.m. The event celebrates sisterhood, women-owned businesses, entrepreneurship and more. It comes with more than 100 vendors, professionals and artisans, guest speakers, workshops and demonstrations.
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