Over the last several decades, successful female leaders have transitioned from cultural outliers to pioneers of a wildly successful entrepreneurial force. As women increasingly lead U.S. companies with stellar results, their economic contribution is as critical as it is valuable.
Today, powerful and driven female business leaders have begun to shatter the glass ceiling, paving the way for future CEOs and founders from all walks of life. Unfortunately, women still have to tiptoe around the shards, meaning there’s still room for growth.
How did the growth of women as business leaders come about, and where are we now? Here’s a look at how female entrepreneurship has changed over the last 30 years.
1980s: Doors opened, deals closed
Prior to the 1980s, the job market was less than receptive to sole female providers looking for work, especially post-divorce. So many women turned to entrepreneurship — these efforts began to pay off when several women were recognized for building sustainable businesses that contributed competitively to the economy. For example, Barbara Bradley and Patricia Miller launched feminine luggage company Vera Bradley in 1982; by 1987, it had grown from a $500 investment into a fully-operating business on the verge of multi-channel distribution.
Before long, female entrepreneurs owned 25 percent of all U.S. firms; soon after, federal programs were launched to provide the resources that would help assist female entrepreneurs. Notably, the formation of the Women’s Business Development Center came to fruition in 1986; shortly after, Count Me In was founded. Both programs helped curate educational seminars, assist with government programs, and provide training opportunities.
When Congress passed The Women’s Business Ownership Act in 1988, it legally ended discrimination in financial lending and eliminated state laws that required married women to have a husband co-sign for all loans.The Act also gave women-owned businesses a chance to acquire bigger government contracts. The very next year, President George H. W. Bush appointed the first woman to head the Small Business Administration, Susan Engeleiter.
1990s: First some pain, then more gains
After the recession in the late 80s and early 90s, many educated women were laid off. As a result, many turned to entrepreneurship out of necessity — to feed their families, pay mortgages and bills. Whatever the reason, it led to a surge in innovation. Female-led startups blossomed at two to four times the general startup rate.
By the mid ’90s, the landscape had changed dramatically. Wells Fargo Bank launched a $1 billion loan fund for women entrepreneurs in 1995 and raised it to $10 billion the next year. Following that, Key Bank, Goldman Sachs and other institutions increasingly launched financing initiatives to help aspiring women entrepreneurs. The 90s also saw the rise of entrepreneurial celebrities including lifestyle powerhouse Martha Stewart. In the span of one decade, Stewart published her first issue of Martha Stewart Living, began a TV show, and formed Martha Stewart Living Omnimedia, making her a billionaire on paper by 1999.
The dawn of computers and the Internet was another aspect that worked to women’s advantage this decade, amplifying their efforts and providing new opportunities for growth and marketing.
2000–2013: Breaking barriers, not the bank
Technological innovation enabled female entrepreneurs to grow their businesses faster in exponentially growing industries. With the advent of innovations like wireless internet, cloud technologies, and intelligent mobile devices, entrepreneurs could work flexibly and collaborate seamlessly.
Business models began to adjust. The ability to grow a business online and market products or services on digital platforms amounted to female-led ventures like Birchbox (Katia Beauchamp) and Flickr (Caterina Fake).
Even a cursory glance at statistics is proof of a boom in female entrepreneurship. For example, an American Express study found that, from “1997 to 2013, the number of women-owned companies increased by 59 percent, while revenues from those companies grew by 63 percent.” And that’s not all — around the globe, they lead one in five startups around the globe.
Small businesses were also able to generate greater production and reach wider audiences in ways that weren’t available before. This is partially thanks to legislation like the Small Business Jobs Act of 2010 and theWomen’s Equity in Contracting Act, which helped businesses headed by women earn more government contracts.
Female entrepreneurship today
Today, companies across the world are seeing the benefits of gender diversity in the workplace and female business leaders have proven that through the massive growth of top tier corporations. The growth of a once sidelined audience has led to both individual business success and collective industry advances as a whole.
Experts predict that by 2018, female-owned businesses will create over half of the new small business jobs and overall, one-third of the nation’s total new jobs. Research also suggests that the U.S, is the best place to be a female entrepreneur, followed by Canada and Sweden.
Women hold nearly a three-to-two majority in undergraduate and graduate education, and it’s beginning to show outside academia: over the past 30 years we’ve seen women in business evolve from having limited corporate rights to operating 22 leading S&P 500 companies at CEO positions.
From inspirational leaders like Susan Wojcicki and Sheryl Sandberg to media giants like Arianna Huffington and Oprah Winfrey, the landscape for female entrepreneurship is more promising than ever.
Of course, many challenges remain: Women still struggle more than men to raise capital, and in spite of educational prowess, are less likely to be promoted to positions of leadership. Women-run businesses also earn just 25 cents for every dollar of a man-owned counterpart; in Silicon Valley, only 10 percent of entrepreneurs are women — a sad statistic compared to the general figure.
As always, change comes with time, and with the economic and social value of female entrepreneurs becoming clearer every day, the tides are already turning fast. Here’s to hoping for even more shattered ceilings in the future, and some sweeping beneath for a less hazardous climb.
This article was originally published on Entrepreneur.com
The era of male dominated businesses is well over. Given recent breakthroughs led by these successful women and more, there is surely a need for gender diversity in corporate America.
Women have quietly been major players in the world of entrepreneurship and we’ve come great lengths in overcoming gender-focused obstacles across all industries. Women currently occupy 22 CEO positions at S&P 500 companies and female owned businesses account for $2.5 trillion in sales.
Businesses led by women are some of the top performing organizations at a global level and here are ten individuals who contribute to that monumental success.
Business and Technology:
Susan Wojcicki – CEO of YouTube
Susan Wojcicki has been with Google since 1998 but took over the lead position at YouTube in 2014. Wojcicki has been the driving force behind a couple of Google’s biggest services including Google AdSense. She also spearheaded Google’s YouTube acquisition and she’s helped the growth of the video platform that brings in $4 billion in revenue.
Sheryl Sandberg – COO of Facebook
Sandberg’s contribution to the technology space has gone unmeasured. Her vision of Facebook becoming a pioneer in the digital advertising sector came to fruition behind her hard work. Facebook’s profits almost doubled in 2014, to $2.9 billion, and mobile ad revenue now comprises 76% of its total ad sales. With the purchase of Instagram, Sandberg plans to grow the hundred-million user base there as well.
Mary Barra – CEO of General Motors
In her second year as the head of the nation’s largest auto-maker, Barra has led the $156-billion-in-sales company out from behind the dark cloud of their 2014 ignition-switch recall. Barra was also one of the few female CEO participants in the viral #ilooklikeanengineer Twitter campaign, to help invite women to the tech industry.
Indra Nooyi – CEO and Chairman, PepsiCo
Nooyi is having the definition of a successful decade as she’s in her ninth year atop the $66.6 billion PepsiCo. She lead the company to see an impressive 4% organic revenue growth in 2014. But Nooyi’s biggest changes have been towards maintaining a healthier product.
She removed aspartame from Diet Pepsi this year and reached a truce after a 2-year feud with activist investor Nelson Peltz which is a great feat for the food and beverage giant.
Tory Burch – CEO of Tory Burch
Tory Burch is the CEO of Tory Burch, a US-based fashion line launched in 2004. Since, the Tory Burch brand has grown to 125 free-standing stores and their line is sold in 3,000 department and specialty stores. Burch does her job to give back too, as an active philanthropist, the Tory Burch Foundation was created to support women entrepreneurs.
Entertainment and Media:
Beyonce’s extreme success has been destined since she lead the women’s singing group Destiny’s Child in the mid-1990s. Since then Beyonce has started a beautiful family with successful music artist and business owner Jay-Z. She’s grown to be a massively supported solo artist and in 2014 she was named #1 on Forbes’ celebrity list.
Oprah Winfrey continues to make huge leaps with the media empire she’s built which has now ventured into the film production industry.
But every avenue for Winfrey is proving profitable, her OWN network has seen considerable growth and she even leads an education initiative for women around the world called the Oprah Winfrey Leadership Academy for Girls.
Arianna Huffington launched the Huffington Post in 2005 and later sold the digital publication to AOL in 2011. Although Huffington still is the editor-in-chief of the business and hopes to expand the readership to more of include more of an international focus.
Real Estate and Healthcare:
Xin is the co-founder of SOHO China, which is a prominent real estate development firm in China that went public in 2007. Xin has shown that she can lead SOHO China towards double-digit growth and profits in her time with the firm.
Shaw founded Biocon, an Indian biopharma company and since it’s inception, Shaw has done a spectacular job growing the business from humble beginnings. She began Biocon out of her garage and grew it into a globally company. Biocon became only the second Indian company to reach $1 billion on its first trading day when they went public in 2004.
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There are a handful of factors that data has shown can create a better, more sustainable business and one of which is establishing gender diversity among your decision makers.
Having female leaders on your side has proven to be more of an advantage than the industry realizes for a variety of reasons. From women who have founded successful startups to women who make their check as venture capitalists, the need for a diverse board can function for a lot of businesses.
Karen Rubin, the Director of Product for Quantopian, is a prime example of this. Quantopian is a crowd-sourced platform to back the best investment algorithms with investor capital, trading operations, and technology.
Quantopian is backed by Khosla Ventures, Spark Capital and Bessemer Venture Partners which attests to the bright future of the tech company. Rubin was initially interested in the idea because she felt she could apply her female leadership role to increasing the stock performance of participating companies and from that became Quantopian.
Although Rubin’s focus wasn’t just around her own place as a female leader in a prominent position, but women in business all together. Starting in 2002 and through the year 2014, Rubin manually input the start and end dates for each woman CEO’s tenure.
Her algorithm calculated the returns to investors in every Fortune 1000 company when it was led by a woman. She then compared those results to the performance of S&P 500 companies. Rubin found that for the women-led companies, the performance seemed to top that of the S&P 500 companies with a 340% return vs. 122% for the S&P 500 benchmark.
Shark Tank investor Kevin O’Leary recently spoke about his insight into his own businesses run by female leaders as well and he was outward in saying that all of those companies are showing returns.
O’Leary told Business Insider, “All the cash in the last two quarters is coming from companies run by women.” He went on to say, “I don’t have a single company run by a man right now that’s outperformed the ones run by women.”
To give a point of reference, O’Leary has 27 companies in his portfolio and 55% of that roster is led by female CEOs. But O’Leary’s most interesting point may be that the companies he is referencing are across multiple sectors which doesn’t seclude the success of this gender to a particular industry.
We often hear that women in decision making positions offer viewpoints from a perspective in need and that seems to be undeniably true. But are we overlooking the fact that considering a women in these positions of power is just about evaluating experience and talent just like anyone else?
Nonetheless, women currently occupy 22 CEO positions at S&P 500 companies and that statistic is sure to increase in the coming years.