Amid such initiatives, it is easy to lose sight of the fact that we still need profound, systemic changes in order for women entrepreneurs to truly succeed. Despite all of the strides made over the past years, women are still underrepresented as entrepreneurs: The latest Global Entrepreneurship Monitor data show that for every 100 men engaged in entrepreneurship in the United States, there are 85 women.
As an entrepreneurship educator, researcher and supporter, I see a need for two systemic changes that can further elevate the status and success of women entrepreneurs. First, the narrative around capital raise as a metric of startup success needs to change. Second, we are in desperate need of child care and elderly care options that are flexible, affordable and sustainable.
The success metric that receives disproportionate attention in the startup world is capital raise. It is a biased indicator of success in that only certain industries and geographic areas have access to venture capital. It also creates unhelpful expectations for aspiring entrepreneurs who are led to believe that being able to attract capital from investors makes them successful—or, in reverse, that growth that is financed by revenues from the business itself is somehow less valuable than growth enabled by outside capital.
This means that much of the conversation on how to support women entrepreneurs focuses on capital access: Venture investment to all-female-founded companies persists at only 2.3% of the investments in all-male-founded companies, so women need help.
Risk capital is necessary for some technology-based startups to scale, and it may serve an individual female founder well to learn to navigate fundraising strategies in the male-dominated VC world. But rather than training women how to behave like men for the sake of fundraising, we need to alter the system of startup capital access to be more varied and inclusive.
To get there, we can start by changing our collective narrative around equity funding in entrepreneurship. Today, capital raise remains the unquestioned metric for startup success and it directly factors into rankings as varied as best college programs in entrepreneurship and most friendly states for female founders.
But when only a small percentage of venture capital flows to female-founded companies, and simultaneously only 0.3% of owners of U.S.-based businesses ever receive venture capital, we should be questioning the relevance of the metric. Let’s start measuring and talking about metrics that are relevant for the 99.7% of American business owners, including women: profitability, meaningful employment, community impact, family wealth, upward mobility, survival in tough times, serving customers with dignity, saving money for the future and paying back loans. Women entrepreneurs have a lot to say on these topics, and once the conversation on entrepreneurial success reflects these realities, even new funding options may follow.
In addition to changing the narrative around success in entrepreneurship, women founders would also greatly benefit from affordable access to reliable care for family members.
Without such access, we are not making progress. Staying at home to run a business while caring for family will hold women entrepreneurs back as unstructured contacts with co-workers, customers and colleagues in the field are crucial for ideation, execution and scaling in the most unexpected ways.
Appreciation for women entrepreneurs starts by talking about the very things their businesses provide—not focusing on old systems and structures that exclude them. Chicago can be the city that leads this conversation and innovates solutions that make success possible for even more women entrepreneurs.
Maija Renko is a professor and Coleman Chair of Entrepreneurship in the Department of Management and Entrepreneurship at DePaul University’s Richard H. Driehaus College of Business.