Clearing the Hurdles: Women Building High-Growth Businesses

98 CLEARING THE HURDLES: WOMEN BUILDING HIGH-GROWTH BUSINESSES

edge, then becomes a very important factor in making the critical distinc-

tion between an exciting idea and a genuine business opportunity.

Technology is not the only area important to business creation and

growth that has gender issues. While a high percentage of teenage girls

expect to attend graduate school, only a small minority expect to have a

“business”-related career. Among the reasons young women cited for

not pursuing a business career were their perceptions that it would be

constraining, risky, and cutthroat, and they preferred careers that

offered an environment in which they could be individuals, ethical, and

doing good things for the community.

18

Of those girls expecting to

enter business, entrepreneurship was the most popular choice.

Although women entrepreneurs in the United States are generally

well educated, they are not a homogeneous group and education poten-

tially impacts them differently. The differences involving race and eth-

nicity are striking. Higher education is associated with the probability

of a White woman being involved in a start-up process, but the impact

is almost twice as strong for African-American women.

19

At the same

time there is no significant influence among Hispanic women. The

Center for Women’s Business Research reported that 33% of the

respondents of a study of Latina business owners had at least a bache-

lor’s degree with an additional 35% having attended some college or

even holding a two-year degree.

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Considering the existing data about educational level, type, and

skills of women entrepreneurs, it’s hard to make the generalization that

all women lack the relevant depth and breadth of education needed to

run a high-tech business.

Experience

There are no internal limits today. There are some

practical ones, like getting more business experience, doing

CHAPTER 5•WOMEN AND HUMAN CAPITAL 99

more networking, and going back to business school

to get more education.

—A successful woman entrepreneur

Work experience is the second major component of human capital.

There are three basic components of experience that are believed to be

important in determining success:

• Industry experience

• General business experience

• Start-up experience

Resource providers look for these three types of experience in their

evaluation of growth-stage ventures.

Relevant experience in the industry provides opportunity to

develop the know-how, the contacts, and a sense of the norms and busi-

ness practices that are used in the industry of choice. General business

experience gives an entrepreneur the chance to make decisions affect-

ing the whole business or gain expertise in specific areas (e.g., market-

ing, finance, operations). Either way, experience in running something

in a hands-on way is important. It is extremely important to note that

general business experience is not limited to the for-profit arena but

can also be gained from participation in volunteer organizations,

schools, and so forth. Finally, start-up experience can provide lessons

for what to do or not do, as well as give an entrepreneur the opportu-

nity to build a team, raise money, and acquire resources.

The challenge for women acquiring resources, especially money,

is based at least in part on the facts: Women are less likely to gain

human capital through experience in higher levels of executive or tech-

nical management. On average, 25% of all managers in Fortune 200

companies are female with some companies reporting rates as low as

only 7% female managers. In 1998 only 11% of the total board seats in

Fortune 500 companies were held by women, and less than 4% of the