It’s an increasingly recognized fact that empowering women through business financing is an important step in ending poverty on both a national and global scale. Globally this has taken the form of microfinance loans and other such resources that allow women in the developing world to pursue business opportunities. Nationally, however, there seem to be fewer initiatives to empower women in business. This manifests itself in such statistics as this – only 7% of start-up funding goes to companies led by women.
While investors clearly don’t favor female-headed companies, there are other financing opportunities that can help women make waves in the business world. Finding funding starts by recognizing the breadth of possible sources that might provide it.
Loans are a less than ideal way to launch your business because they force you to build your foundation on top of debt. This is far from a fortuitous beginning, but sometimes it’s the only way to pursue a dream. If you do take out a loan, you should specifically seek a business loan rather than working from your own personal credit lines, if at all possible.
Your business loans may come from traditional banks or through other alternative funding companies. Either way, you’ll want to compare interest rates and choose a loan appropriate to the size and scope of your company. There is no one size fits all when it comes to business loans.
When you start with too large of a loan, you risk joining the thousands of companies that fall into debt each year.
Community connections matter a lot when you own a small business, and they can help you find funding sources you might not realized were available. Connect with other women-led businesses and seek mentoring relationships that can help you navigate the many tasks that make up entrepreneurship.
Having someone to talk to, who can answer questions and provide support, can be worth more than money, but it can also lead to funds. Ask your mentor if they know anyone who would be interested in supporting a new female business owner. They may have a good community connection they can send in your direction or they may remember another business owner helping them and want to pay it forward. This is a more common source of funding than you might think.
In addition to local networking, it’s always a good idea for women business owners to join the National Association of Women Business Owners. This organization can offer many valuable resources, including ideas about how to pursue funds for your business venture.
Seek Out Programs For Women
Because women’s businesses are so underfunded as a category, organizations focused on women have sprung up in an attempt to remedy this. Seek out these programs and sidestep the prejudice against funding women entrepreneurs. This may mean going to banks that you know have worked well with women business owners before, but often it means finding non-profits and other small organizations that want to foster women’s leadership.
You may also find that your state has a program for women in business. These programs are becoming more common, but they are often under-discussed, meaning that those who need them most don’t know they exist. This makes it important for you to ask directly about such opportunities. As with many aspects of owning a business, it never hurts to ask.
Pay It Forward
If you pursue a broad set of funding options for your business, you’ll eventually find the opportunity you need. Unfortunately, it may take a lot of networking to find these sources, but this is the nature of being a woman in business, even in the 21st century. What this difficulty reinforces, however, is that women need to support each other in these undertakings.
When you finally find the funding to pave your personal road to success, remember the support that got you there. Then, when you’ve established yourself, find a way to give that back at whatever scale you can. Women are each other’s best allies, in business and in so many other things, but that can be a source of power, too.