BOOK Summary: Clearing the Hurdles

by Candida Brush, Nancy M. Carter, Elizabeth Gatewood, Patricia G. Greene and Myra M. Hart, published in 2004

10 Points for the W2W Community from Clearing the Hurdles

1. In the middle of the venture capital rush of the 1990s, 5% of the venture funds went to women entrepreneurs.
   • The one remaining true educational barrier for women is technology. In this area women are under-educated and under-represented. (p. 248) Unfortunately, this area is also where most venture capital and high-growth companies reside.

2. 1 in every 11 women in the U.S. is an entrepreneur with a 50% or greater stake in the business.
   • Women are majority owners of about 28%, or 6.2 million, U.S. businesses. However, these are disproportionately small businesses – 84.8% of women owned businesses are sole proprietorship arrangements, i.e. not employers, versus 72.6% of all U.S. businesses.

3. In a 2002 survey of women business owners 55% reported they needed less than $25,000 to start and 6.5% needed more than $100,000.

4. “If you have a company with an itsy bitsy vision, you have an itsy bitsy company.” – Anita Roddick, founder of the Body Shop. (p. 69)

5. Motives influence the aspirations of a business. Women and men explain their aspirations differently. Women typically articulate a social purpose, while men are more focused and economically specific. Women’s broad and holistic approach may make them appear less credible to potential investors and potential partners.

6. Linguists have found that women use different communication styles than men that may hurt them when looking for business support. Women tend to downplay their certainty whereas men downplay their doubts. Women tend to qualify their comments with doubts, and despite their realistic outlook, it hurts their ability to sell and market their ideas.
   • Women tend to use conversation for interaction and men use it to glean information. Women’s interjection of personal lives and family into business conversations may give the impression they are less committed to the business than men.

7. “I’d rather have an A team and a B idea than the other way around.” The single most important factor in investing in a business are people.
   • General business experience is not limited to the for-profit sector or paid positions. Volunteer work and part-time work can provide valuable experience and lessons that can later be applied to a start-up and used to attract investors and other talent.

8. Bootstrapping a business (funding early growth) falls into two categories: minimizing the demand for capital and finding alternative ways to meet capital needs. Minimizing the need often translates into finding ways to control resources without owning them. For instance, leasing or, as applied to people, finding part-time or contract personnel. Finding alternative ways to meet capital needs could translate into minimizing inventory and exploring creative payment for suppliers.

9. The effective use of social and professional networks is a critical component of successful business. Research shows managers considered successful spend 70% more time engaging in network activities than their less successful counterparts.
   • Women tend to face the challenge of feeling less qualified which in turn affects their ability to join networks beneficial for business. As one professional counselor quoted in the book notes, “Successful networking has three main ingredients: know-how, savvy, and guts.” Self-perception directly affects the “guts” part of the equation.

10. Entrepreneurs need large reserves of social capital when they start their business – i.e. favors they can call on, or the ability to go into debt in their social capital account. Also, make sure your social capital is in the right currency – i.e. it applies to what you are doing. In preparation for a successful enterprise, extend your social network beyond your personal network – think wider reach with less emotional commitment – a strategy that requires breaking into the “old boy” networks. Limited networks also adversely affect the business when a woman is looking to staff the venture with the most qualified people and can’t look beyond their close personal network.