Financing of Women-Owned Businesses

3BusinessWomenOctober is National Women’s Small Business Month and a few days ago the Washburn University Kansas SBDC hosted our second Day of Workshops for Women-Owned Businesses.* In the U.S., there are more women-owned businesses than ever before and they have significant economic impact. In 2019, 12.6 million businesses identified as women-owned, they supported 9.4 million jobs and generated $11.9 million in revenues. Yet, women-owned businesses lag businesses in general in economic impact and one of the reasons for this is disparities in access to capital and undercapitalization of women-owned businesses.

According to American Express’s 2018 and 2019  State of Women-Owned Businesses Report which is based on information collected by the U.S. Census Bureau, between 2007 and 2019, the percentage of all businesses owned by women grew from 29% to 40%; but employment supported by women-owned firms in the same period grew from only 4% to 6% and percentage of revenues generated grew only 4% to 4.3%.

While there are a number of factors that have contributed to this trend, one of them is funding during the start-up phase and the impact of that initial funding on the business’s growth.

Here are some facts about access to capital for women business owners:

• Women business owners raise smaller amounts of capital to fund their businesses than do men. Women are more reliant on personal funds than external funds to start their businesses than are men. (NWBC)

• Men tend to raise nearly twice the amount of capital to start their businesses that women raise, on average $135K for men and $75K for women. (Forbes)

• Women are more likely to be turned down for loans than are men and receive only about 4.3% of money commercially lent or about $1 out of every $23. (WPFSI)

• Male-owned companies are funded 4x more frequently than women-owned businesses by venture capitalists and receive 2x the capital that women receive when they are funded. (NWBC) Women receive approximately 7% of venture capital. (Fundera)

–• Disparities in capitalization between businesses owned by men and by women do not disappear after start-up but rather tend to persist. (NWBC)


Businesses at a minimum need to be able to cover their liabilities; but in addition, they need the capital to fund growth whether it be hiring new employees or being able to afford to hire better qualified employees, purchasing bigger & better equipment to increase capacity, developing new products, entering new markets, or expansion of a physical location.  Adequate early funding can make a big difference to a business’s cash flow, ability to survive start-up, ability to reinvest in itself, profitability and ability to bring in more funding – all of which affect future growth potential.

At the Kansas SBDC, one of our core areas of advising is about money. We help prospective and existing business owners understand how much money and along what timeline they will need funding in order to start and grow their businesses, where to look for capital, how to manage growth, put together and read financial documents (e.g., cash flow projections), set profit goals and understand how exit strategies might fit into the overall financial picture.

Local and regional resources for women-owned small businesses include the following:

Minority & Women Business Multiplier Loans NetWork Kanas

Minority & Women Business Development Kansas Department of Commerce

Women’s Business Center in Kansas City

GoTopeka Partnership 

Kansas PTAC 

National Resources:

Amber Grants for Women

•  WOSB Programs U.S. SBA

National Women’s Business Council

Women’s Business Enterprise National Council

* Thank you to Women in Business  of the Manhattan Area Chamber of Commerce for co-sponsoring the Day of Workshops for Women-Owned Small Businesses on October 29th.

Related Articles:

Government Contracting for Women-Owned Small Businesses

7 Things Women Business Owners Should Embrace

Celebrating Women Business Owners

Growth Resources for Women-Owned Small Businesses

Laurie Pieper, Ph.D.

Business Advisor

Washburn University SBDC

America’s SBDC Kansas

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