Thinking Of Becoming An Entrepreneur? Read This First
By 2018, women-owned businesses in the U.S. will generate a third of new jobs.
By Leah Eichler (Contributing Writer, Femme-O-Nomics)
When I decided to leave the world of the gainfully employed to launch my own company, I may have suffered from a selective attention span.
To this day, I struggle to see anything but entrepreneurial success stories and many of them include women, such as Sara Blakely, the owner of Spanx, a company valued at around $1 billion. Other examples include cosmetic discovery service Birchbox, co-founded by Hayley Barna and Katia Beauchamp, Rent the Runway, the couture rental site co-founded by Jennifer Hyman and Jennifer Fleiss, and Toronto-based Just Energy Group, founded by Rebecca MacDonald.
My selective attention aside, the appetite for entrepreneurship, especially among women, appears to be growing. In the U.S., women-owned businesses increased by over 50% between 1997 and 2012, one and half times the national average. By 2018, women-owned businesses in the U.S. will generate a third of new jobs, according to The Guardian Life Small Business Research Institute survey.
In Canada, women retain ownership of almost half of all small and medium-sized businesses and represent an untapped source of economic opportunity, according to the Taskforce for Women’s Business Growth.
The excitement surrounding women launching their own businesses feels contagious, even on paper. But when my last paycheck came in I started to seriously question my sanity. For those considering the professional equivalent of jumping out of a plane, it’s worthwhile to listen to the women who already made the leap.
“I still have those days when I think I’m insane and I don’t think that ever goes away,” confessed Nancy Peterson, CEO and co-founder of HomeStars, which provides reviews of contractors to homeowners in six cities across Canada.
Despite this, Ms. Peterson, who left her role as a business director at Kraft Foods to launch her company, believes there are good reasons for taking the plunge.
“Working in large companies may provide a level of security but with that may come complacency and entitlement,” observed Ms. Peterson. “You don’t feel as empowered to do what you really want to do sometimes,” she added.
The move didn’t come easily to Ms. Peterson, who incorporated her business in 2003 but didn’t launch until three years later. Even after leaving Kraft Foods, she continued to work for them part-time as a consultant, which brought the security of a paycheck. Eventually, she realized that to fully embrace her new career, she needed to cut her ties. She didn’t replace her paycheck for three years.
Ms. Peterson advises women making the jump from the corporate world to the realm of the self-employed to temper their expectations, especially when it comes to compensation. She also explains that while lofty goals are important, focus on one success before moving on to another, a lesson she learned when HomeStars launched in Boston, a move that failed due to lack of resources.“I still have big ambitions but I’m more cautious now,” admitted Ms. Peterson.
The entrepreneurial zeitgeist around women has been well documented. Dr. Dorothy Perrin Moore, the author of WomenPreneurs: 21st Century Strategies and emeritus professor of business administration at The Citadel School of Business in Charleston, SC explained that two major forces influenced the rise of women entrepreneurs. The entering of women, minorities and immigrants into the mainstream workplace in the 1960s and 70s marked the first era of social transformation.
The second, said Dr. Moore, was driven by “technological disruption,” which reduced the cost of starting and running a business. She believes the combination of these two movements will transform the business landscape over the next decade and begin an era of economic decentralization. According to her research, by 2017 small businesses in the U.S. will be formed and run by a more diverse group of entrepreneurs, with the largest number consisting of women exiting corporate life.
The number of entrepreneurial success stories that have dominated the media, such as Facebook and Pinterest also create a cache around entrepreneurs, observed Aliza Pulver, who left her law practice to launch Homesav, a flash sales site selling home furnishing products.
“Somehow we think that every entrepreneur will have huge immediate success and the measure of success now has really skyrocketed as a result of these type of businesses,” said Ms. Pulver. “In reality, most people going through the start-up process soon experience that it is a ton of work, with most of your time spent in jeans and runners in a small office but with fabulous people,” she added.
Despite the warnings and obstacles, Dana Oren, founder of adHub, an online print advertising network encourages new entrepreneurs to worry less. “Stressing about the bumps in the road doesn’t allow you to enjoy the journey and instead takes you off the path of a positive, productive and solutions-focused headspace,” she said.
This post was originally posted at Femme-O-Nomics.
About the guest blogger: Leah Eichler is the Co-Founder of Femme-O-Nomics, a networking application and content portal for professional women. She is also a well-known columnist on issues surrounding women in the workplace. Follow her on Twitter at @femmeonomics.