As the small business landscape continues to grow in Canada, the female entrepreneurial presence is rising too. A third of small businesses in Canada are headed up by women, and many of them have only been around for five years or less.
The data hails from Salesforce’s new report, The New Canadian Entrepreneurial Experience: Women and the Future of Small Business in Canada, which unearths interesting stats about women and small business in Canada, and particularly about females in STEM (Science, Technology, Math, and Engineering) fields.
The report, which was commissioned in partnership with The Gandalf Group, found that 53% of all female-led businesses in Canada have only been around for five years or less. That’s compared to 34% of male-led businesses, which suggests that more women are starting businesses now than ever.
Female Small Business Owners in STEM
When it comes to STEM, however, men still dominate, with males being twice as likely as females to own a STEM-based business, at 25% versus 13%. Women, on the other hand, are most often launching businesses in the services sector, including retail, hospitality, and consumer products, at 75%, as well as other services (45%), including healthcare, education, and professional services.
It’s understandable when considering further data revealed by the study that suggests women who do own STEM businesses report experiencing significantly greater challenges than men. Much of this relates to achieving that all-important work-life balance, with 65% of women saying they struggle with it, compared to just 48% of men. Additionally, 63% of women say they’ve faced obstacles accessing capital for STEM businesses, versus just 40% for men, and 61% of women feel their services are undervalued by customers, while this is only reported by 41% of male entrepreneurs in STEM.
Most commonly, we’re seeing younger women enter STEM fields, with 59% of female entrepreneurs under the age of 45 versus 42% of males of that age; and 27% of female entrepreneurs even being younger than 35. This, notes Salesforce, could be more related to generational disparities than gender, since younger women (and men) are generally more attracted to technology than older.
STEM jobs are growing, and the industry has the potential to yield tremendous profits in the SMB space. But men, who tend to be more motivated by financial considerations (78%) are more often pursuing STEM-based small businesses than women, who are more motivated by having a good work-life balance (79%) than making money.
But, as Salesforce notes in its report, the increase in efforts to attract women to STEM subjects and careers, along with the democratization of technology, has the ability to level the playing field. “Women and youth,” the report reads, “are poised to irrevocably alter the face of Canadian entrepreneurship in the coming years and decades.”
What SMB Women Want
As noted, women often start their own businesses so they can achieve a better work-life balance. Women are most often the primary caregivers in the home, whether they have a career or not, so female entrepreneurs are presumably looking to achieve this balance by working from home, working flexible hours, or just overall being responsible for their own schedules. Ironically, however, once women start their own businesses, they discover that successfully maintaining this balance is still one of the biggest challenges they face, cited by 52% of respondents.
Both women and men equally, however, agree that their third-largest challenge is acquiring new customers.
Many of the female SMB owners surveyed noted that they were also driven to starting their own companies in order to do more meaningful work, and to start a business “on the side.”
The five characteristics women believe are most important to successful entrepreneurship are dedication, effective planning, passion, discipline, and ambition, which is not much different than the top-five for men: dedication, discipline, ambition, passion, and effective planning. Interestingly, however, of all of the traits SMB owners of both genders were surveyed about, including being unafraid to take risks, having strong financial management, strong people skills, and sociability, the only one men placed greater emphasis on than women was competitiveness.
Helping Female SMB Owners
In order to continue the growth of female-led small businesses in Canada, women require support. Last week, the Honourable Mary Ng, Minister of Small Business and Export Promotion, announced that three women-led companies would be receiving investments under BDC Capital’s Women in Technology (WIT) Venture Fund, as part of the Government of Canada’s Women Entrepreneurship Strategy, which will include a $2 billion investment to improve women’s access to capital, advice, best practices, and targeted, gap-closing support. The businesses that received funding include Fredericton, NB-based AI company Eigen Innovations, Vancouver, BC-based software company Beanworks, and Kiite, a company that has built an intelligent sales coach, and is based in Waterloo, one of Canada’s tech hubs.
“With women starting close to half of all new businesses in Canada,” said Prime Minister Justin Trudeau in a statement during Small Business Week, we also know women’s success is vital to growing our economy and creating new jobs.”
Women-led businesses, and particularly those led by young women under the age of 45, are booming. The possibilities are endless, and if the trend continues, we could be on track to seeing female-led small companies account for half of all SMBs in Canada as we approach a new decade.
Related: Small Business