Angels Den Blog

At Angels Den we do like to tackle the big (and controversial) issues, especially when it comes to those that affect funding for starting a business, so here goes.

Over the years the debate has raged on about whether it is men or women who make the better business owners. Now while I appreciate that your gender may provide you with a leaning towards one side or the other, I’m asking you to put that to one side for the moment. The reason for this blog debate is that according to a recent FT article female entrepreneurs’ businesses have been hardest hit by the recession. So why should that be? And what impact could that have on female entrepreneurs seeking funding for starting a business?

Now I appreciate that I’m touching on a very emotive subject, so don’t start throwing things at me quite yet. Please do keep in mind that throughout this article I will be generalising. Look deep inside yourself, see the truth in my words…then start throwing things at me!

Firstly I’d like to start on a note that should appease everyone. The battle of the sexes is over. Yes it’s official, we’re all winners. Men and women are equally good at running businesses; we just have a different approach. In a normal world this would mean that men and women should be equally successful in business (although how you measure success is another debate altogether), a fact that should also appease you if you’re considering offering funding for starting a business. Unfortunately, we’re not living in normal economic times and although the number of small businesses that are starting up has not waned, they have been dealt a cruel blow, and the FT article claims that the worst hit have been female-run ventures.

It is a (generalised) fact that men and women act and react differently in a work environment. Where men are more likely to focus on progression up the career ladder at any cost, women are more focused on fostering relationships with those around them. Women are more likely to start businesses that interest them, whereas men are more likely to go into business for the profit rather than for the passion. Women are more likely to start a home-based business or lifestyle businesses than men. It is these nuances that have left female entrepreneurs more vulnerable to the recession.

Now if you’re offering funding for starting a business you probably already know what types of businesses fare best through a recession and which ones are likely to be hardest hit. Lifestyle businesses tend to be luxuries and with diminishing disposable incomes, rising unemployment and fears of a prolonged downturn, these tend to be the sectors hardest hit.

Of course as we’ve already established men are more likely to be focused on self interest and survival at all costs, so are far more likely than women to lighten the ship by making people redundant. And with this reduction in overheads they are likely to have a better chance at surviving and even thriving in a recession.

So with experts starting to agree that we may be nearing the end of the recession (even if it’s going to take a while before we hit the beginning of the recovery), those businesses that have survived intact may well be in a better position to profit from the new positive mood out there. Once again businesses run by female entrepreneurs may well leave the now understaffed male-run businesses trailing, as they are forced into new recruitment drives. Essentially, if you’re offering funding for starting a business there are far more important things to consider than whether the business is being run by a man or a woman. After all that kind of gender specific consideration is very 1970s don’t you think?