I started my company 20 years ago and have been the sole owner of it ever since. I didn’t know many women in my early days with their own businesses, nor did I realize how unusual and risky (25% of start-ups fail in the first year) my decision was. I also didn’t think about why women start businesses – many reports cite women’s disgruntlement with working in traditional workplaces as the number one reason.
I’m not sure whether the disgruntlement is related to working a traditional work day away from home and children, or if it has more to do with male-centric work environments proving challenging for women seeking advancement and higher compensation. My first boss told me, when I asked to be considered for the next logical promotion in his small outfit, “I don’t want a girl running my company.” That certainly motivated me to move on from job #1, which I did tout de suite for a promotion running another company (of course, boss #1 offered me the job a few months later, and when I reminded him of his earlier words, he claimed never to have uttered them – discriminator and liar, check.)
But the motivation for starting my business had to do with the part of the traditional workplace that meant 9 to 5 in an office. I wanted freedom over how I spent my time and with whom I spent it. But once out on my own, I realized that it was my attraction to large-scale transformation work that had really propelled me out of the standard work environment. Organizations like big change now and again, but need periods of stability and maintenance – that is just when I lose interest. Consulting, in particular, turned out to be a great way for me to move from one project to another, thereby satisfying my penchant for change work without being labeled a flibbertigibbet (something boss #2 warned me about when I told her I was resigning after 18 months).
According to the U.S. Census Bureau’s 2007 Survey of Business Owners (the most recent edition), women owned 7.8 million businesses, an increase of 20.1 percent from 2002. This accounted for 28.7 percent of all businesses (excluding farm businesses) in the United States. Women-owned companies reported 7.6 million employees (6.4 percent of total employment) and generated $1.2 trillion in receipts (3.9 percent of all receipts). By contrast, men owned 13.9 million U.S. businesses (51.3 percent of all nonfarm businesses) in 2007, an increase of 5.5 percent from 2002. So, women-owned businesses grew four times as much as men-owned in the same period, even though men still own nearly twice as many businesses. It looks like more and more women are choosing to work for themselves, and it would come as no surprise to me if the reasons are largely the same: more personal freedom and control over one’s destiny.
For those women-owned businesses that are also small businesses, there’s some good news. And, by the way, the Federal government generally defines a small business as under 500 employees (some variation by industry), and since the majority of women-owned businesses have no employees, most qualify. (And why is this, you may ask. When I set out, limited resources were a big reason, but what persisted in keeping my company an employer of one for many years was my preoccupation with doing everything myself – a proclivity of many women entrepreneurs.)
So, what’s the good news? In February of 2011, the Small Business Administration (SBA) issued findings that some categories of small businesses are underrepresented in the federal contracting system, and has created new rules to identify these contractors and fast track the process to engage them. There are even mandated percentages of federal dollars that must be spent with small businesses: the Small Business Act requires 23% of Federal prime contract dollars to be awarded to small businesses, with awards of at least 5% of its prime and subcontract dollars to go to women-owned small businesses (WOSB). These contracting percentages are called “set asides” and are widely ridiculed in some circles. But the SBA explains their action this way: “without a specific set-aside mechanism, it was clear that agencies could not meet their goals… and ensure a level playing field on which such small businesses can compete for Federal contracting opportunities.” In other words, just because women are the sole owners of nearly a third of all businesses (and they co-own many more with male partners), they are not getting federal contracts at anywhere near that level. (And there are also similar SBA provisions for minority-owned small businesses, for the same reasons.)
My company recently became aware of these new rules and just completed the application process. We were surprised to find that the process is both straight-forward and fairly simple. The SBA has put together an excellent website that details what an applicant needs to know, and it is clearly linked to the related websites of the Central Contracting Registration (CCR) and the On-Line Representations and Certifications Application (ORCA). The program fact sheet from the SBA can be read here. So, if you are a woman who owns a business with fewer than 500 employees, you may want to check out this opportunity.
In these economic times, any leg up for small business is good news. One specifically for women, whose percent of federal business falls far short of their percentage of business ownership, calls for a hip hip hooray. At the same time, after 20 years in business, I was just a bit surprised that a program like this is still necessary.