Out of 291 survey respondents, 70 percent said they require funding to support their growth
Getting a business off the ground has never been easy. How do you secure enough funding? What kind of support and services are at your disposal?
Answering such questions can be tough, but if you’re a female business owner, things get even murkier. In fact, almost half of B.C.’s women entrepreneurs don’t know where they will access funding in the next year, according to a new report by nonprofit WeBC.
Called Closing the Gap: Meeting the Unique Borrowing Needs of BC’s Women Business Owners, the study follows up on a 2021 report about the obstacle that women face in securing capital. “We call this the Closing the Gap report because we see this as an opportunity for the ecosystem to collaborate on programs that better support women business owners and their communities,” said Melanie Rupp, senior director of loans and advisory at WeBC, in a release.
Conducted in fall 2021, the new survey gathered responses from 291 female entrepreneurs, 70 percent of whom said they needed funding to support their growth.
WeBC. The 2021 survey’s respondent profile
Sixty-five percent of respondents didn’t apply for funding in 2021 because 39 percent of the group didn’t know their options and 31 percent expected rejection. According to the findings, women prefer gradual and intentional growth strategies and are risk-averse, which could have played a role in the sharp increase of women self-funding their businesses, from 19 percent in 2020 to 37 percent in 2021. This isn’t the best news if you’re trying to scale, considering how important relationship-building with funders can be when it comes to ensuring sustainable growth.
Working with lenders is a big goal for Kelowna-based WeBC, whose 18 staff try to engage banks, credit unions and other organizations to help secure funding for female entrepreneurs. The nonprofit offers loans of up to $150,000 for women-owned businesses, as well as advice, training and mentorship to those who qualify.
That’s good, because women in B.C. don’t think traditional lenders can meet their needs. As a result, only 17 percent of women surveyed who applied for funding in 2021 did so through a bank, and only 6 percent were satisfied with the service. Just 10 percent are willing to approach a bank for a loan this year, demonstrating a lack of long-term funding that aligns with their requirements.
WeBC. The 2021 survey results show how female business owners are looking to use funding
The call for support services is reaching a crescendo: 88 percent of those surveyed expect their business to grow next year, but 75 percent believe advice, training and mentorship are essential to their performance. In the wake of the pandemic and its accompanying supply chain problems, respondents think market challenges will be their biggest hurdle, so such support can help them prepare for unforeseen circumstances and build their confidence, networks and growth potential.
Given that 38 percent of B.C. business owners are women (our province ranks second nationwide for share of total businesses that are female-led) and that self-employment is growing faster among women than men, it’s more important than ever to meet their needs.
Rupp and her team at WeBC are looking to streamline essential services: “What we’re doing through these reports is highlighting that women have unique needs and sharing what those unique needs are, and then helping the organization to see how they can tailor their programs and services to women business owners in the province,” she says.