The Window of Opportunity
for Women and Minority Owned Businesses
Gender equality is a hot topic in technology right now. And disregarding the fact that all things are not equal, I do believe there is a bizarre and unnecessary lack of women in technology, especially in the new world of start ups. I also believe that we are fundamentally asking the wrong question.
The question seems to be “How do we get more women in tech/start-ups?” I take a stand that we need to change the conversation to look at “How do we educate women and men about the HUGE business opportunities (to the tune of billions of dollars) right in front of us if we bring diversity into the mix?”
And not just diversity of skin color, gender, race and sexual identity…but diversity of THOUGHT…diversity of EXPERIENCE…diversity of EDUCATION.
One of the issues with the famous Silicon Valley is the lack of diverse thought. So many of the men and women come out of MIT or Stanford with similar thoughts, educational background and mindset. We lack the ability to bring in people from diverse industries in order to move innovation forward.
However…this article is supposed to be on the Window of Opportunity for Women and Minorities to open the door to funding.
There has been a stigma attached to the difficulty in gaining access to traditional funding sources. Because of this many women and minorities simply forgo the route of traditional capital markets, thus further reducing access to capital within these groups.
The New Opportunity
A recent report by Crowdfund Capital Advisors states that data shows many women and minority-owned businesses are strong market performers, they survived the economic crisis better than their counterparts, and were more profitable afterwards.
However, Crowd Funding and the emerging Crowd Fund Investing can level that field.
In some sense, crowd funding has been around for hundreds of years. This is your friends and family. The difference in today’s market, and the signing of the JOBS Act, allow your “friends” to be the likes of people you’ve heard or seen on social media, or that respond to an advertisement…or simply “like” you and your product.
Key highlights from the report include:
- Crowdfunding can provide an alternative method of funding minorities and women, while providing investor protections and enabling risk sharing among a community.
- Of the fifty highest funded projects on Kickstarter, the premier crowdfunding site, 45 have turned into ongoing entrepreneurial firms . This proves that crowdfunding ideas can lead to promising enterprises.
- Crowdfunding is unique because it not only brings money, but also an engaged community of supporters that are both customers and investors
- Peer to peer lending data shows that women are receiving more funding then men
- Major under-served markets, many of which are turning majority minority, are where very successful crowdfunding campaigns have been based
- Promoting crowdfunding as an alternative funding source for women and minorities can create more new business starts, tax revenue, jobs, gender inclusivity and economic equality. All key parts to a healthy economy
- Women owned businesses had sales of over $1.4 Trillion in 2014
- 41% of businesses are women owned, but only 8% of ventures that are backed by professional investors are founded by women
An Alternative Method for Funding
Crowdfunding can provide an alternative method of funding minorities and women, while providing investor protections and enabling risk sharing among a community. It is unique it brings money as well as an engaged community of supporters that can be both customers and investors. Traditional investing is often provided by people that see the business potential of your product or service, but they may not be “champions” of your company — despite it being in their best interest to do so.
Some other facts about Crowdfunding:
- Peer to peer lending data shows that women are receiving more funding then men.
- Major underserved markets, many of which are turning majority minority, are where very successful crowdfunding campaigns have been based.
- Promoting crowdfunding as an alternative funding source for women and minorities can create more new business starts, tax revenue, jobs, gender inclusivity and economic equality. All key parts to a healthy economy.
Conclusion:
The truth is, if we keep focusing on the problems we see in tech and startup funding, we will continue to see those problems. The key is to focus on the solutions — and the opening doors of crowdfunding can be one solution to catapult many to successful launches for all kinds of businesses — from “main street” brick and mortar to the high-tech gadgets and gizmos.
Heather Furby is Co-Founder of Creative Age Leadership, a company dedicated to helping women navigate the special needs of today’s entrepreneurial business mindset. From building your trusted and loyal team to mastering remote management, or taking your cocktail napkin idea to a successful business, Heather will teach you how to break the rules of business without being an outcast. www.CauseAndSuccess.com
