4 Ways Women Can Jump Common Hurdles To Start a Business

Women-owned businesses continue to fuel the U.S. economy, generating $2.7 trillion in revenue and employing 12.2 million workers.

According to a 2024 Wells Fargo report , the number of women-owned businesses has increased in recent years at nearly double the rate of businesses owned by men.

“While starting a business for women can be more difficult at times, the strengths women possess still make it very possible to be successful in the business landscape,” said Christine Hsu, a female real estate entrepreneur and co-founder and chief operating officer of Noblivest .

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GOBankingRates spoke to Hsu and other female entrepreneurs about four ways women can overcome common hurdles to starting a business.

Also see how three self-made millionaire women built their fortunes .

Money mistakes the super wealthy never make - that you might be doing now.

Know What You Want

Many potential entrepreneurs, regardless of gender, are lured into owning a business by the promise of choosing their own work hours and the potential for financial freedom.

However, Liz Scully , a business strategist and mastermind coach, said there is a difference between being good at what you do and running a business.

“One of the most important things to remember about business is that doing the thing you love is only a tiny fraction of running a business,” Scully said. “You’ll be spending about 30% to 40% doing what you really love to do, and the rest of the time is getting clients, marketing, speaking to clients and the actual servicing of the thing you want to do.”

Scully said social media often contributes to the idea that “everyone” should be running a business when they shouldn’t.

“If you want to be a masseur, for example, and you want to run a massage business, they are two different things,” Scully said. “If you want to be a masseur, maybe you want to change your life so you’re just working as a masseur.”

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Have Sufficient Savings

Men have the advantage when it comes to getting business loans, especially small business loans.

According to the latest data from the U.S. Small Business Administration , male-owned businesses receive nearly 70% of loans, totaling over $20.9 billion. Companies that are more than half owned by women receive nearly 21%, or just over $4.4 billion.

Worldwide, women entrepreneurs — who make up an important part of the micro-, small- and medium-business economy — are underbanked. The World Economic Forum estimated that the finance gap for women entrepreneurs globally is $1.7 trillion.

In 2019, Hsu said she was told by a major bank that she needed her husband to sign loan documents, although she was her company’s majority shareholder and listed as the managing principal.

“In the modern day, you would think that women should have the liberty to access funding, loans and banking freely without the permissions of a man or spouse, however there are times when that is still not the case,” Hsu said.

The gap in accessing capital makes it important for women to have at least six months’ or even several years’ worth of savings before quitting their full-time jobs. Building an established business can take awhile.

“It takes much more time, resources and energy than we can expect,” Scully said. “So once people make the leap to starting the business, they need to have the finances backed up behind them.”

Start a Side Business First

Scully said potential startup business owners should start their venture as a side hustle first. This approach allows women to build their savings and do the things they love in their new business.

Starting your business as a side hustle first also alleviates some of the work-life balance pressure many female business owners feel.

“This balancing act can create significant stress and may sometimes limit the time and energy available for business growth,” Hsu said. “We often see successful men with families have wives who manage the family and home. Unfortunately, women who lack these supports may find it harder to navigate the entrepreneurial landscape when other support systems are not readily available.”

Focus On Results

Erika Baez-Grimes founded two women-owned companies, which her husband currently runs full-time. For over six years, she worked as a business broker and represents Transworld Business Advisors .

Baez-Grimes said that while she recognizes the historic hurdles women entrepreneurs face, it’s also important to focus on producing the best results for your clients and customers.

“I’ve excelled because of their (Transworld’s) dedication to supporting brokers with the data,” she said. “We strive to help clients cross the finish line, give realistic expectations and make great matches for the businesses we represent.”

This article originally appeared on GOBankingRates.com : 4 Ways Women Can Jump Common Hurdles To Start a Business