Women Entrepreneurs On The Forefront Of Continual Growth: Leveraging Capital Networks For Sustainable Businesses

This paper was presented by Jill R. Kickul and Susan D. Sampson, both from Simmons School of Management, and Lisa K. Gundry, from DePaul University, at the 49th World Conference of the International Council for Small Business in South Africa on June 20-23, 2004.

The process through which women-led entrepreneurial firms plan and achieve continual growth often reflects a complex set of motivators and intentions that support this strategic path. Contemporary research has shown that women entrepreneurs recognize the precursors of growth and the importance of activities such as information seeking and planning to their strategic leadership roles. This study seeks to determine the influence of a diverse set of factors (beyond industry) that facilitate growth intentions within women-owned businesses. That is, are there influences that seem to make more of a difference, such as capital resources (economic and social), networking, and training needs in encouraging growth and expansion? In our study, we examine multiple factors including the: assembling of capital resources, use of social capital (e.g., reliance on formal and informal network for business assistance), and future training needs that influence the continual growth intentions.

This study, commissioned by a women’s business center located in the Northeast section of the United States, examined 421 women-owned businesses over a three-month period. Results revealed that women entrepreneurs with high growth intentions tended to use more formal social networks and used their membership in a women’s business organization to network and support their growth needs. For financing, although bank loans were more readily available to firms with higher growth intentions, private and venture capital investment still is not available. Finally, in seizing opportunities in the marketplace, the firms with higher growth intentions launched their businesses faster (in less than 6 months time) and reported they needed training in very specific areas: strategic planning and production/operations. Taken altogether, the women entrepreneurs with higher growth intentions relied on, utilized, and needed a diverse set of factors to assist them in reaching their growth objectives.

This research represents one of the few large-scale studies of established women-owned enterprises focused on continual growth and expansion. Our study offers support for the process by which formal and informal capital resources within women-owned firms can serve as critical antecedents of potential market growth and expansion. This research takes an important initial step in understanding the process of how women entrepreneurs leverage and build upon their own resources both internally and externally that may be used in the future to identify market opportunities, confront industry and environmental changes, and seek new innovations for their businesses.

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