Module two for review (draft 8)

DRAFT FOR REVIEW - PLEASE DO NOT CIRCULATE

A Tool Kit for Credit Union Leaders and Lenders

Module Two


Why do more women than men start businesses in Canada but more men grow them?

What barriers do women face in growing their businesses?

How can credit union leaders and lenders better support women to grow their businesses?


Vancity Community Foundation undertook the

Women Entrepreneurs: Financing

Opportunities for Growth

project between 2011 – 2013 to address these questions.

The project included extensive

research and a pilot project for women

entrepreneurs.


The content of this tool kit reflects what we learned from project participants, service providers and advisors about how credit

unions in Canada can better support women to grow their businesses and, by

extension, support greater economic activity and job creation.


Welcome to Module Two:

Women and Reasons for Entrepreneurship


In This Module We Will Explore

1. The three main profiles of entrepreneurs.

2. The reasons women give for becoming

entrepreneurs.

3. How those reasons can be different from those stated by men.

4. How reasons for entrepreneurship are linked to business growth and success.


Introduction

• Why do women become entrepreneurs? Is there a difference between why women

and men become entrepreneurs?

• In order to understand more about women entrepreneurs, it is important to know, in general, why men and women start businesses.


Facts

• Women have been starting businesses at a higher rate than men for several decades in Canada.

• Women tend to own smaller businesses but are poised to play a significant role in future job creation through

growth.

• In 2007, 81% of firms in Canada that had fewer than 5

employees were women-owned.

• In 2010, 36% of BC’s small businesses were owned by women.


Three Types of Entrepreneurs

1. Classic Entrepreneur

2. Lifestyle or Work-family Entrepreneur

3. Forced or “necessity”

Entrepreneur


Type One: Classic

• Motivations: Like Challenge, Seek Financial

Independence (53% of women, 71% of men)

• Classic entrepreneurs are more likely to own an incorporated business and to have employees.

• They are less likely to work in home-based businesses, more likely to work full-time, and more likely to work longer hours than those in the other groups.


Type Two: Lifestyle or Work-family

• Motivations: Work/Life Balance, Flexibility(25% of women, 7% of men)

• Lifestyle or work-family entrepreneurs are more likely to have home-based businesses, to work part-time and to work relatively shorter hours.

• Few entrepreneurs have incorporated their businesses in this group.


Type Three: Forced or ‘Necessity’

• Motivations: Unemployment,

Underemployment, Lack of Suitable Work

Opportunities (22% both men and women)

• Forced entrepreneurs are more likely to be sole proprietors, work at home and keep full-time hours.

• Many people in this group would chose to have a conventional job if it were an option.


Reasons for Entrepreneurship

53%

25%

22%

71%

7%

22%

0% 20% 40% 60% 80%

Classic

Lifestyle

Forced

Men

Women


Differences in why men andwomen start businesses.

• “Greater freedom” is reported as the single most important factor for self-employment for both men and women.

• A significant number of all entrepreneurs previously worked in the sector in which

their business operates.

• But more men than women say making money was the main motivation for starting a business.



• Women more often than men launch businesses to balance work and family responsibilities.

• 27% of women surveyed say flexibility and work-family balance was the motivation for starting their business compared to 7% of men.



• According to a Women’s Enterprise Centre survey in BC in 2011, 69% of women surveyed mentioned “passion and self-fulfillment” as a primary motivation.

• Many women say they identified a need or niche that motivated them to start their business.


Different Reasons to Grow

Business

• Motivations change over time and the top reason women cite to grow their business is to increase their income.

• According to Industry Canada, in 2007 16% more women intended to grow their business than men (44% vs 38%).


In BC

• According to clients surveyed by the Women’s Enterprise Centre in 2011, these are the top three reasons given for business growth:

– Higher income (66%)

– Passion, self-fulfillment, challenge (63%)

– Increased demand, business opportunity

(61%)


Top 3 Reasons for Start-up vs Growth

69%

53%

28%

66%

63%

61%

Passion & Self-fulfillment

Independence & Autonomy

For the Challenge

Higher Income

Passion & Self-fulfillment

Increased Demand/Business Opportunity

Growth

Start-Up


Video


Women entrepreneurs are more

likely than men to:

� start out as lifestyle entrepreneurs motivated by a

desire for independence, self-fulfillment and flexibility

�be relatively conservative when it comes to taking

risks

�not require large amounts of start-up capital

�have smaller, more manageable businesses with

fewer employees

�be interested in business growth but approach it

differently than male entrepreneurs - preferring a ‘slow and steady’ rate of expansion


“My single piece of advice to women

considering expanding their business

is be sure to dream big enough, no

dream is too big.”

Joyce Groote, President and Chief Executive Officer of Holey Soles Holdings Ltd.


Quiz

• Please click on this link to review the points covered in this module.

• Note to Reviewer:

– Modules will include an optional, online quiz

(5 to 6 questions) that will reinforce some of

the key points made in the module.


NOTE TO REVIEWER

• The following three slides are an infographic delivering a few key facts.

• It is difficult to see in this format but will be readable in the final online presentation.





Resources

• Websites

• Articles

• Studies


End Notes

Sources

• Hughes, Karen D. 2005. Female Enterprise in the New Economy . Toronto: University of Toronto Press.

• Hughes, Karen D. 2006. “Exploring motivation and success among Canadian women entrepreneurs.”Journal of Small Business and Entrepreneurship. Vol.19, Issue 2.

• Small Business Profile 2011

• Small Business BC, www.smallbusinesbc.ca

• BC Stats, wwwbcstats.gov.bc.ca

• KPMG. October 15, 2012. “Women changing the face of Canadian entrepreneurship”

• http://www.newswire.ca/en/story/1052491/women-changing-the-face-of-canadian-entrepreneurship

• CIBC World Markets, 2004. “Women Entrepreneurs: Leading the Charge”.

• Caranci, Beata and Leslie Preston, January 2012. “The Venus Vs. Mars Approach to Entrepreneurial Success in Canada.” TD Economics.


Project Partners

Project partners:

This project was funded by

Documents

Module two for review (draft 8)