Bridging the Gender Gap in Entrepreneurship

Photo by Iwaria Inc on Unsplash

Recent findings from the latest GEM Global reports, both the Global Report released in February 2024 and the Women’s Entrepreneurship Report released in November 2023, shed light on a persistent challenge: the gender gap in entrepreneurship. Despite strides towards equality, women entrepreneurs continue to face significant barriers that hinder their participation and success in the entrepreneurial ecosystem.

Our outspoken focus is on youths and young adults, which of course includes young women too, so we thought to shed some light on this issue and share some research that has been published within the past half year.

Understanding the Gender Disparity

The Global Entrepreneurship Monitor (GEM) releases global reports every year on the state of entrepreneurship in about 50 economies worldwide. The latest global report paints a vivid picture of the gender gap in entrepreneurship. Across 48 economies surveyed, women entrepreneurs are, on average, younger and more educated than their male counterparts. Yet, they are more likely to report lower household income segments, highlighting the nuanced challenges they encounter despite their qualifications and aspirations.

Barriers to Entry and Fear of Failure

The data reveals that in a significant majority of economies surveyed (37 out of 48), experts rated the social support for women entrepreneurs as unsatisfactory. This suggests a systemic issue where women entrepreneurs may not be receiving the necessary support networks and resources to thrive in their entrepreneurial endeavors. Interestingly, despite the unsatisfactory rating for social support, in a majority of economies (28 out of 48), women entrepreneurs’ access to resources, when compared to men, was rated as satisfactory or better. This indicates that while there may be some equality in access to resources, the broader ecosystem of support for women entrepreneurs still falls short in many aspects, considering the consistently lower number of women entrepreneurs compared to men, as nearly one in every three entrepreneurs running established businesses is a woman.

“…in a significant majority of economies surveyed (37 out of 48), experts rated the social support for women entrepreneurs as unsatisfactory.”

One reason for this might be the pervasive fear of failure among would-be entrepreneurs, particularly women. In 35 of the 45 participating economies, at least two in five adults who perceive good entrepreneurship opportunities hesitate to start a business due to fear of failure. This fear disproportionately affects women, with higher proportions of women than men refraining from entrepreneurship because of a fear of failure in 37 economies.

Entrepreneurial Intentions and Start-up Activity

Despite these challenges, there is cause for optimism. Globally, one in six women expresses an intention to start a business in the near future, with the highest rates observed in low-income countries at approximately 28%. In terms of start-up activity on a global scale, there are 0.80 women for every 1 man, indicating a slightly lower participation rate among women, but women exhibit a higher propensity for solopreneurship, with 1.47 women solopreneurs for every 1 man. Women’s startup rates are particularly high in low-income countries and Latin America & the Caribbean, indicating a growing interest in entrepreneurship among women worldwide.

Addressing Stereotypes and Inequality

The report highlights the detrimental impact of stereotypes that frame women entrepreneurs as disadvantaged and lacking in business competency. This false narrative perpetuates inequality and undermines the contributions of women entrepreneurs to economic growth and social development. This also ties into our previous blog post, about the missing entrepreneurs. However, the GEM reports call for a shift in perspective, emphasising the importance of supporting women who are starting and scaling high-growth, innovative businesses.

Key Recommendations for Bridging the Gap

The findings of the GEM Global report underscore the urgent need to address the gender gap in entrepreneurship. To bridge the gender gap in entrepreneurship, the reports mention some actionable recommendations:

1. Tailored Support Programmes: Understanding the unique needs of women entrepreneurs within specific sectors is essential for designing effective support programmes that address their challenges and empower them to succeed.

2. Digitalisation Support: Providing assistance with digitalisation costs and improving access to technology can help women entrepreneurs overcome barriers in the digital landscape, enabling them to compete on a level playing field.

3. Celebrating Sustainability: Governments can incentivise sustainability practices by providing procurement incentives to women-led firms that prioritise social and environmental impact, thereby fostering a more inclusive and sustainable entrepreneurial ecosystem.

Empowering Women Entrepreneurs is KEY for Economic Prosperity

By offering tailored support, challenging stereotypes, and celebrating diversity, we can create an environment where all aspiring entrepreneurs, regardless of gender, can thrive and contribute to economic prosperity and social development. It is time to unleash the full potential of entrepreneurship by bridging the gender gap and empowering women entrepreneurs to drive innovation, create jobs, and foster inclusive growth.

This is something we are deeply committed to. Through our app’s personalised coaching, interactive challenges, and inclusive community, we aim to break down barriers, equip aspiring entrepreneurs with the necessary skills and support, and cultivate a culture of inclusivity and empowerment. Together, we can create a more equitable and thriving entrepreneurial ecosystem, where every individual has the opportunity to realise their entrepreneurial dreams and make a meaningful impact on society.

For more insights, please refer to the GEM Global Report “25 Years and Growing” from 2024: Read the report here, and the GEM Women’s Entrepreneurship Report “Challenging Bias and Stereotypes“ from 2023: Read the report here.