As many women know, much of the funding available in commercial markets comes with strings attached, and mal entrepreneurs often have an easier time acquiring financing. Unfortunately, this sometimes means a woman needs to rely on her spouse or family to provide capital for her business. Other examples include bank loans requiring collateral (which men often have more of) and investors who rely on personal connections to decide whom they will back financially.
So, where can women go when traditional sources outside their inner circle are not an option?
Investors Geared Towards Women
Some organizations exist expressly to provide funding specifically to women entrepreneurs, such as WEN (The Women’s Entrepreneur Network) and Astia Angels. These groups frequently prioritize investing in companies started by one or two female founders rather than larger teams since one study showed that companies with all-male founding teams are nearly four times more likely to receive venture capital than enterprises led by women. Female founders, in particular, tend to be penalized when it comes to funding, so this type of organization is essential for leveling the playing field.
Another option for women seeking access to additional funds would be through one of many crowdfunding platforms aimed explicitly at welcoming female entrepreneurs seeking small amounts of money from strangers online. GoFundMe has made headlines by helping people get the funds they need for medical care, college tuition, and other basic living expenses. The website’s “Go Woman” category provides financial support only towards causes initiated by females. Similarly, Kickstarter has begun championing the “Kickstarter for women” campaign, allowing female entrepreneurs to pitch their products and receive funding from interested buyers.
Small Business Loans
Women seeking to grow an existing business may consider applying for small business loans at their local bank or credit union. While banks are typically less flexible than more progressive organizations regarding providing start-up capital, they can be a more comfortable option for some women who have had trouble securing loans through alternative means in the past. Again, having family members co-sign on her loan is one of many requirements that can help mitigate risk when it comes time for lending institutions to approve deals.
Finally, some government programs provide financial assistance specifically to minority female business owners. The United States Department of Agriculture has created the Minority Business Development Agency (MBDA), which has made it easier for women to gain access to low-interest, long-term loans designated for minority-owned businesses. The Women’s Business Enterprise National Council (WBENC) provides the same support, but specifically for female entrepreneurs. This can be especially helpful in rural areas that lack brick and mortar business lending sources, as it allows women who may otherwise have difficulty getting financial help an opportunity to pursue their dreams.
Doaa Dashoush is an experienced businesswoman in the fashion industry. She currently serves as the President and CEO of GFASHION, a global luxury brand currently based in New York City. GFASHION prides themselves on their unique approach to the industry. They don’t follow trends set by others. The Luxury brand focuses on innovative design through their work with the top designers on collections that reflect the company’s craftsmanship.