The whole “woman business owner” thing is somewhat of a mixed bag. Many high-achieving women admit they have issues with the label.
On one hand, being a woman can offer the advantages of minority status and permission to take risks (and fail with minimal penalty), or even scoot under the radar. On the other hand, being labeled a “woman” entrepreneur or executive can sound dismissive, an unavoidable asterisk pinned to every success.
Historically, women entrepreneurs took it on the chin—forging startups in male-dominated industries, networking with the suits for funding and building hierarchical staff structures while working 9 to 5 in offices. There was no crying in entrepreneurship, and there wasn’t much traction for classic female archetypes like the mom, the sister or the supportive friend.
But that was then, and this is now. Welcome to the new age of the woman entrepreneur, where successful women leaders are embracing their gender differences by creating female-inspired products and services, with companies led by moms and funded by empowering sisters. Men aren’t out of the picture, but they’re no longer defining the parameters of success.
Being a woman entrepreneur isn’t better or worse than being one of the boys. It’s just different, and today’s successful female company founders have figured out how to work it.
Why Women and Why Now?
The stars have aligned for 2014, which portends to be a banner year for women entrepreneurs. One-third of all U.S. firms have women as majority owners, according to Growing Under the Radar, a 2013 update of American Express's annual study of the state of women-owned businesses. The study also 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.
As for money, things are looking up there, too. Although the amount of funding for women-owned firms is still less than for men, the number of angel investments grew by 40 percent from 2012, the study found. The number of female angels themselves grew by 50 percent during the same time period, according to the Center for Venture Research, indicating that funding networks are becoming less of an old-boys’ club.
“Woman are starting to realize that we are the solution to our own problem,” says Lauren Flanagan, whose early-stage angel fund, Belle Capital USA LP, based in Douglas, Michigan, invested $1 million in three women-owned startups last year, with plans for more in 2014. “Women control half the wealth in the U.S., but we do very little investing. If we can invest, that’s game changing because it brings more money to the early-stage landscape.”
Flanagan points out what other investors have started noticing—that in many ways, women-led firms outperform those run by men. “Women-owned companies funded by angels perform the same as their male-led counterparts,” Flanagan says. “But they do it with a third less capital. Also, there are fewer failures.”
This return on investment is catching the eye of later-round investors as well: Venture capital deals for women-owned companies grew by 20 percent last year, according to Pitchbook. “Women in leadership," Flannagan says, "is a significant asset to an investor.”
From ROI to R&D
With women controlling the majority of consumer spending, it’s surprising they haven’t been more highly involved in calling the shots before now. It feels intuitive that women would understand what women want to buy—but, of course, intuition is often labeled as a feminine trait. Today’s women entrepreneurs are banking on it.
Leading examples include Tory Burch (above), who has created a fashion empire with $800 million in revenues generated because she identifies and sells exactly what women want. So has Sara Blakely (below), founder of SPANX, whose company has annual revenues of $250 million.
“Companies like SPANX or HelloFlo wouldn’t have happened with venture capital money,” says Kara Goldin, founder of Hint Water, a fruit-flavored water producer in San Francisco. “Men just can’t wrap their arms around some of these products.” Goldin is among the new breed of “mompreneurs,” a label traditionally applied to new moms with side gigs or empty-nesters starting smaller, lifestyle businesses. But Goldin is a corporate veteran who cut her teeth on the tech bubble, running AOL’s e-commerce and shopping divisions until they became billion-dollar revenue generators in 2001, when she decided to take a break from corporate life.
In Goldin’s case, she probably wouldn’t have become an entrepreneur if she hadn’t been a mom. The shift in life stage not only gave her a bit more downtime for idea creation, but it also shook up her thinking. Instead of focusing on digital commerce, Goldin found herself looking for ways to make her family’s life better. “I feel like female consumer products are either about helping others or helping yourself,” Goldin says.
She developed fruit-flavored Hint Water in 2005 as a healthy substitute for sodas, and they’ve made a big splash in the male-dominated beverage industry. The company, which began in Goldin’s kitchen, is projected to exceed $50 million in retail product sales this year, according to The Wall Street Journal.
Work It, Girl
Some industries come fully charged with male-female tension and stereotypes, and part of the work today’s women entrepreneurs are doing is leveling those playing fields. When Stacie Vanchieri started her modeling agency in Richmond, Virginia, 21 years ago, her goal was to redefine what a female-run agency could do.
“I’m from New York,” says Vanchieri, a former professional photographer. “And when I moved here, I realized that the agencies here were more of a part-time thing for a woman to do out of her home.”
Vanchieri saw the opportunity to professionalize her region by starting a New York City-style agency. Today, Modelogic [Wilhelmina] (now a Wilhelmina affiliate) has locations in Richmond and Chicago, and casts shoots around the country for such clients as Abercrombie & Fitch, Walmart and Geico. Vanchieri says her former local competitors have since gone out of business.
Modeling is a very complicated business—assigning financial value to a person’s posture and bone structure can be emotionally brutal and rife with sexual undertones. Vanchieri embraced the challenge and says that being a woman helped her navigate it cleanly and professionally, raising the bar for her industry.
She opened a real office that wasn’t in her home, hired someone to answer the phones and actively chased business—an activity that can earn women a much-maligned label in the business world. “’Aggressive’ is the best word I can think of, and I’m not bothered by it,” Vanchieri says. “I’m very direct because I’m busy and I don’t have time to waste. That can be scary for a lot of people.”
Ultimately, Vanchieri figured out where being a woman is an advantage. “The business I’m in, women are good at,” she says. “I know beauty. I know when a girl walks into the room if she will be financially successful. I know this better than men, because I’m not distracted by some other part of it.” In addition, Vanchieri says that being a mom herself means that clients, especially parents, tend to trust that her motivations are all business.
Doubling Down on Mom
A visionary sees opportunity where others don’t, and for Allison O’Kelly, that meant completely embracing the “mom” label and working it hard enough to turn it into an asset. With a Harvard MBA and stints at KPMG in accounting and at Toys 'R' Us to help the company launch its online business, O’Kelly was used to being a minority in a man’s world. She started her company, based in Marietta, Georgia, in 2005.
“When I started, I got a lot of patronizing pats on the head,” O'Kelly says. “But sometimes that’s good. Nobody took me seriously at the beginning so nobody tried to copycat what I was doing.”
What O’Kelly was doing was starting a staffing company focused on recruiting and placing moms. Called Mom Corps, the company unabashedly identified with a somewhat marginalized faction of the workforce. “I wanted to help these experienced professional women get into the workforce in a more flexible manner,” O’Kelly says. “’Mom’ can be a little dismissive, so I could have called it ‘Flexible Pros’ or something. But I liked the idea that people would talk about it one way or the other. People have commented on the name both positively and negatively, asking me if I want to change it or add another brand. I’ve been steadfast that it needs to remain Mom Corps—that was very intentional.”
O’Kelly’s approach landed her company on the 2013 Inc. 500 list of fastest-growing private companies, with $16 million in revenues in 2012. She has also inspired a few competitors.
Far from being successful despite being a woman, O’Kelly’s success hinges on the distinction—a tactic that any entrepreneur can embrace. “Whatever those differences are, leverage them and turn them into strengths,” O'Kelly advises.
Today’s women entrepreneurs are making it in spite of any stereotyping labels, but they're leveraging what we think of as typical female traits to flourish—networking and supporting each other, developing products and services that women want and making “mom” mean “success.” Today's woman startup business owner has become one of her company’s biggest assets.
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Photos: Getty Images, Modelogic, Hint Water, Mom Corps