Male vs. Female Business Owners - Who's More Successful?

  

I've been hearing a lot about a recent Wall St. Journal article, Why Are Women-Owned Firms Smaller Than Men-Owned Ones.  Sharon Hadary shares this troubling news:

The phenomenal growth of women-owned businesses has made headlines for three decades—women consistently have been launching new enterprises at twice the rate of men, and their growth rates of employment and revenue have outpaced the economy.

So, it is dismaying to see that, despite all this progress, on average, women-owned business are still small compared with businesses owned by men. And while the gap has narrowed, as of 2008—the latest year for which numbers are available—the average revenues of majority women-owned businesses were still only 27% of the average of majority men-owned businesses.

What's going on here?  Could it be that women and men have different measures of success?  Different goals when they start a business?  Sharon Hadary shares this research in the article:

Research also shows that the differences between women and men entrepreneurs begin with their own reasons for starting a business. Men tend to start businesses to be the "boss," and their aim is for their businesses to grow as big as possible. Women start businesses to be personally challenged and to integrate work and family, and they want to stay at a size where they personally can oversee all aspects of the business.

Sounds like a big overstatement to me, though I think there is a ring of truth to it.  Doug Hickok, CEO of Institute for Provocative Leadership shares his thoughts in the blog post Journal Gets It Wrong/Right About Women Business Owners.

Since when is business success measured just by size, and why is this woman [Sharon Hadary] doing that? 

To Ms. Hadary,  the fact that women-owned business revenues are “still only 27 of the average of majority men-owned businesses” is a problem, even as she goes on to say that women start their businesses for different reasons than men.

Now, I am an executive coach who works with a lot of women business owners, and I can attest to the fact that women are very individual in their desires for their businesses, including revenues and size.

Doug Hickok goes on to point out some valuable insight in the Wall Street Journal article as to what's holding women back and his take on them:

 

• Women often fail to set high goals for growth. Very true, but women – and men – usually set goals only for revenues, leaving out other aspects of their business and their lives. Strong goals are needed for all of those things, or life doesn’t feel whole and satisfying.
• Women often start their businesses with fewer resources available to them than men. Sometimes true. This factor can drive women out of what they really want to do and into retail or personal services industries instead, for example, where the cost of entry is low, but so is the growth and profit potential.
• Research shows that women tend to think of debt as a “bad thing” to be avoided… one of women’s strengths is relationship-building, yet women seldom focus on building relationships with bankers. True again. Often women don’t reach out to the banker until they’re in trouble and REALLY need the money… the very worst time to start the relationship.

What are your thoughts?  Do men and women have different measures of what a successful business looks like?  

 

Comments

[Katgordon]

Fascinating. I own a small business and I measure success by the ability to serve my clients as personally as possible and to be able to make my own schedule to accommodate my family. When business gets big, everything gets big: the bills, the physical office (and its maintenance), expectations for continued growth, liability. Bigger profits aren't guaranteed. I would love to know how the satisfaction differs between women business owners and men. That's the benchmark that matters most -- at least in my book.

[Holly Buchanan]

Kat,

interesting that you point out liability and maintenance. women tend to think longer-term and focus not just on goals, but consequences. I wonder if women are comparing gain of getting big with pain of getting big.

[Direct Mail Marketing]

I think why there are more men engaging in business than women, it is because women usually just stay in the house. They are the ones who take care their children and the house hold chores.

[Chris Eastvedt]

For me, a woman, my small business stays at a size I feel is manageable, which is more important than money. I don't like managing employees, so I'm more comfortable doing the lion's share of the work myself. I'm in a creative industry, so the structure of my business is free-form: I pick up a project here, a collaboration there...nothing keeps me rooted in a particular place. For me, it's about how much I'm enjoying the work and the people.

I gamble when necessary, but I try to be smart about it: Experimenting with new ideas is great, and failure breeds innovation, but debt is an absolute no-no (I'm a die-hard bootstrapper and won't ever change). I work to enjoy my life, not to improve my status or position, which seems to be the opposite with many men.

[Wayne tarken]

I would agree that women can have a different measure of success. Many women who leave corporations are not looking to become the next Steve Jobs, Donald Trump. It's for more of a lifestyle decision; flexiblity, child care challenges and personal growth out of the corporate rat-trap. To grow a business also requires more time out of the home at evening events, entertaining big clients and travel. Not the most appealing hours and demands for many

[Kelly Watson]

I definitely have a different measure of success than most people. Sure, it would be nice to have a multi-million dollar business, but frankly, I don't want the stress. I'd rather work for myself, set my own hours and take a random Tuesday off when I feel like it. Will I make less money because of it? Sure, but I've never been very interested in money, anyway. I'm much more interested in having a balanced life that involves lots of time spent with friends, family and good books. As long as I can pay my bills, I'm happy.

[orange county tech support]

I am going to be graduating within a year with a degree in education. I want to open my own Daycare. I have been working in them and I feel I could be much more beneficial by opening my own. I live in an area where we have a lot of factories so I would like to have one that is open 24 hours.

[Adwomen]

Hi Holly,
Interesting question. I think that women and men have a different priorities in their life and these influence in their work. I think like kelly, I like having a balanced life...And having a balance has a positive impact in all areas of the life: family, friends, work...

[Tiffany Jonas]

I agree with Kat Gordon that one of the most important ways my firm measures success is by our clients' delight---not just satisfaction, but genuine delight. That said, I am always sincerely dismayed to read statistics like the one you highlight. Money was a major factor in my decision to start my own business in early 2004 and as our firm's leader I have consistently sought to grow the business both for my own sake and that of my staff and clients.

While I have nothing at all against anyone of either gender, having been in the trenches for some time, I do feel that the world of business still isn't quite a level playing field for women. Different motivations likely have something to do with this, but my guess is that it's a much smaller part than the WSJ authors propose, and that the overall problem is made up of many small differences.

Male networks are more entrenched and extensive simply because of the time men as a gender have been able to participate in business, for instance.

I suspect, too, that many women are more generous in choosing to do business with firms owned by either gender--wanting to be treated fairly themselves, they try to treat others fairly--while a number of men may have a stronger preference for doing business with men rather than women... though I also suspect this preference is subconscious and of course, this is NOT the case with all male executives or male-owned firms. (Don't shoot me! My firm works with many male business owners/executives and we find them absolutely as delightful as our other clients. I am *not* pointing the finger at anyone.) But because of this, I also understand those women business owners who actively seek to do business with other women business owners; they're seeking to level the playing field a little.

A very thought-provoking post!

[Suzanne]

Thanks for the post. Its a very crucial question put forward by you. Nowadays many women are engaged in different types of businesses. They definitely have a good sense of business but at the same time they are more or less very emotional and therefore they sometime lack the practical decision making power required in business which the men generally possess.

[Duo London Escorts]

This is a good topic of Male vs. Female Business Owners.It is very interesting to read about that research of men and women.I came to know some facts of men as well as women from this post.

[Katrina Hase]

When I read this article, the first thing I did was to call the head of our local women's networking organization to see if we could organize a talk on the subject. We did, and I later wrote an entry on my blog about it...I'd love it if you'd share it here: http://www.themixcreative.com/blog/2010/08/12/why-are-women-owned-firms-smaller/

It's a complicated issue! I'm glad to see that women business owners are reading and considering the article in public forum.

[Sheri Cockrell]

In my experience I have learned that women business owners are less likely to be assertive, be up-front, and really don't like to talk about their accomplishments. On top of that, they find it harder to ask for help and delegate.
On the flip side, women are much busier in their personal lives than men are. Most women are the sole care-givers of their families. Trying to "do it all" is an impossiblity.

It is a proven fact that women have a much harder time promoting themselves, and seeing a bigger picture for their companies than men do.

This is where women have to step-up and help one another to succeed. We need to partner, joint-venture, and co-promote on a much bigger scale to bring our businesses to the forefront of the serious business arena.

[Toronto Marketing Company]

Meaningful post! Thanks for sharing this astuteness. It is interesting. We should be conscious about its peril.

[InterviewHer]

This is a very interesting article. We are big supporters of women entrepreneurs.

[web design firm san diego]

IMHO, there is indeed a ring of truth to the statement "women start businesses to be personally challenged and to integrate work and family."

My husband has a good career in his job right now, but I wanted to help him out with the family finance, so I started a home-based business last month. While I wanted to balance my time between business and family, I still nevertheless strive to be competitive and even looking forward to expand my business with the help of resources available online and offline.

-Abigayle Soderstrom

[compare and contrast essay]

Male networks are more entrenched and extensive simply because of the time men as a gender have been able to participate in business, for instance.

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“when someone calls you stupid, you arent really stupid, they are just jealous unsmart people have more fun!!”

[Door handles]

Obviously male, because male has more bearing power than a female. In difficult situation, female can't handle the situation properly as compare to male.

[Matthew Engquist]

Hmmm... It's pretty tough to determine which gender is more successful in business, as there is no absolute definition of success. One person can be successful for some and not for others. I love how the points are delivered. As for me, both sexes are successful in business in their own right.

[Bennie Sawrey]

This isn't about who's more successful between. It's about how one handles the business. Their characteristics and positive outlook can help grow a business. They can work together to improve the business. Working together in perfect harmony would allow the business to stay strong. :-)

[Flip my websites]

This isn't about who's more successful between. nice sentence.

[Online Business]

dont need to compared those of it lol. both work hard for it

[Payday Loans Online]

I think case is not really in men and women, I used to think that everything depends on a person and goals he or she sets before starting a business.But of course there are some differences between how men and women manage their business.Women are more emotional and I think they more often are subjected to stress,I think this emotional side of business management makes some influence.