Janice McDonald is president of the Beacon Agency. Clare Beckton is founding executive director of the Centre for Women in Politics and Public Leadership at Carleton University
Our national tour of Canada reminded us of John Candy's Planes, Trains and Automobiles, but we also added a Helijet from Victoria to Vancouver. Travelling across the country, our mission was to speak to as many female entrepreneurs as possible about entrepreneurship and risk-taking.
We wanted to test the assumption, created by literature and financial reports, that female entrepreneurs are averse to risk. Since they make significant contributions to the Canadian economy, it was important to test an assumption that could negatively influence their access to financing for growth. We interviewed more than 100 entrepreneurs across all sectors and wherever we went, we found women who wanted to share stories reflecting determination, resilience and frustration.
Our report, the result of a partnership between Carleton University's Centre for Women in Politics and Public Leadership, the Beacon Agency and the Bank of Montreal, reflects this journey.
What did we find?
First, that although their motivations for starting a businesses varied, most of the women we interviewed were ambitious and wanted to grow, or continue to grow their businesses to realize a variety of economic and social goals. We found women who were ready to make calculated or rational risk-related decisions to grow their businesses.
For example, one woman told us about making the decision to purchase a warehouse during the recession, so she would be stocked with inventory when it ended. As their entrepreneurial experience grew, they developed greater confidence to make the tough decisions necessary to achieve their goals. They were eager to mitigate risk by building strong teams, seeking advisers and getting the help they needed to grow.
Decisions about risk are influenced by an entrepreneur's notion of success. Female entrepreneurs tend to be interested not only in earnings statements, but also in the business's impact on all aspects of their lives. Some told us how they contained their business's rate of growth to accommodate family flexibility and increased that rate later, when they had fewer family obligations. Some contained growth to pursue a desired lifestyle and others pursued aggressive growth when they were able to obtain funding or self-finance their business growth.
Another key finding is that female entrepreneurs take a relationship approach with their customers, clients, employees and funders. Many told us they wanted better relationships with their financial institutions, which meant that the institutions had to be interested in their business and committed to its success. Financial institutions have not fully understood women entrepreneurs' desire for a relationship and their longer-term orientation. Not a single entrepreneur told us that she wanted to start a business to sell it quickly.
Female entrepreneurs are reluctant to approach venture capitalists and other investors because they do not want to relinquish control and because they don't feel comfortable seeking money from a predominately male-dominated sector that largely looks to invest in fast-growth companies.
As a consequence, women struggle to obtain funding for startup and growth, self-financing their growth or obtaining loans from family and friends. Determination and resilience were hallmarks of the women interviewed.