In October, we celebrated National Women’s Small Business Month, which commemorates the October 1988 passage of the Women’s Business Ownership Act, throwing out the legal mandates that women were required to have a male relative as their co-signer on business loans. Nov. 20, 2019, marked the fifth annual Women’s Entrepreneurship Day, described by Fortune magazine as a global celebration of female business owners.
A lot has changed in 31 years.
Today, female business owners are succeeding at phenomenal rates. According to the National Women’s Business Council 2018 report, there were an estimated 12.3 million female-owned businesses in the U.S. in 2018, accounting for 40% of all businesses and generating $1.8 trillion in revenue. As the nation’s No. 1 small-business lender, Bank of America’s small-business clients reflect this encouraging trend with approximately 40% of our 11 million small-business clients being women.
Even better, female small-business owners were poised to end 2019 on a high note, with 84% anticipating year-over-year revenue growth with plans to hire and expand in 2020, according to Bank of America’s 2019 Women Business Owner Spotlight. The most recent California Economic Forecast reflected a growth in Kern County, as we continue to attract new residents, leading to a growth in the job market. Female entrepreneurs will truly have an opportunity to become a driving force in the local economy, starting new businesses at a higher rate than ever.
Key to addressing this perspective is connecting female entrepreneurs to the capital that’s out there. And female business owners surveyed in the Bank of America report say having more females in positions of influence would be the most impactful factor in paving the way for the next generation of women in business.
To better understand this thriving community of business owners, Bank of America surveys female business owners annually across the country to gain insights into their goals, aspirations and concerns.
Notably, this year’s survey found that female entrepreneurs are more confident in their revenue, hiring and expansion plans compared to their male counterparts, yet more than half said they feel they don’t have the same access to capital as male counterparts.
For example: 73% plan to expand their business over the next 12 months (versus 66% of male business owners), up from 67% in 2018. About 62% expect their revenue to increase in the year ahead (versus 55% of male business owners), up from 58% in 2018. Roughly 25% are planning to hire (versus 23% of male business owners), up from 21% in 2018. Approximately 52% of female entrepreneurs are confident their local economy will improve, up from 49% in 2018.
Mixed with this optimism and momentum were reflections on the challenges of establishing and financing a small business, including the extent to which gender bias may play a role. When reflecting upon positive influences on their success, more than half of female business owners identified external factors like experiencing adversity, obtaining a college degree and having a mentor have helped them achieve success. This is an especially important factor for female small-business owners in the Inland Empire region, which rates as one of the lowest metros in California in educational attainment for women.
When asked for the single character trait that has had the greatest impact on their business success, female entrepreneurs identified integrity (23%) as the top personality attribute, closely followed by perseverance (22%).
Looking to the future, business owners agree that having more women in positions of influence would be the most impactful in paving the way for the next generation of women in business.
And we couldn’t agree more.
As the nation’s leading small business lender, with approximately 40 % of the 12 million small-business owners we serve being women, Bank of America recognizes just how vital the role of women is in driving economic growth.
Education, training and networks play key roles in entrepreneurial success, which is why we have formed partnerships to connect female entrepreneurs to these resources. Through the Tory Burch Foundation Capital Program, we have committed more than $50 million to help female entrepreneurs grow their businesses. For the sixth consecutive year, we also partnered with the National Association of Women Business Owners, serving as the presenting sponsor of the annual Women’s Business Conference.
We are proud to do our part by providing the capital, opportunities and tools women entrepreneurs tell us they need to help launch and grow their businesses, so that they have the power to advance their businesses and make significant contributions to our economy.