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Earlier, while thinking of entrepreneurship, the people who came in mind immediately were Jeff Bezos, Mark Zuckerberg, Mukesh Ambani, Warren Buffett, Michael Bloomberg and Bill Gates. What is the one common thing between all these entrepreneurs? These all are men, powerful men who had an out-of-the-box idea and worked hard continuously to reach where they are currently.
However, the present-day situation differs. Now, budding entrepreneurs look up to not only these gentlemen but also women like Tory Burch, Falguni Nayar, Arianna Huffington, Richa Kar, Shradha Sharma, Susan Wojcicki, Shubhra Chadda, Indra Nooyi, Upasana Taku, Gina Rinehart, Kiran Mazumdar-Shaw and Aditi Gupta who have crawled their way up to the list.
Today, India has 13.5–15.7 million women-owned enterprises, representing 20% of all enterprises. While large in absolute numbers, these are overwhelmingly comprised of single-person enterprises, which provide direct employment for an estimated 22-27 million people. The global evidence buttress that women have been performing exceedingly well in different spheres of activities like academics, politics, administration, social work and so on. Fuelling entrepreneurial spirit and providing necessary support to women entrepreneurs hold the promise of changing the economic and social trajectory of India and its women for generations to come.
The Government of India has defined women entrepreneurs based on women’s participation in equity and employment of a business enterprise. Accordingly, a women entrepreneur is defined as “an enterprise owned and controlled by women having a minimum financial interest of 51 % of the capital and giving at least 51% of the employment generated in the enterprise to women”. Nonetheless, this definition is subject to criticism mainly on the condition of employing more than 50% of women workers in the enterprises owned and run by the women. In nutshell, women entrepreneurs are those women who think of a business enterprise, initiate it, organize and combine the factors of production, operate the enterprise and undertake risks and handle economic uncertainty involved in running a business enterprise.
In real life, however, our society is still male-dominated and women are not treated as equal partners both inside and outside four walls of the house. They are treated as weak and dependent on men. As such, the Indian women enjoy a disadvantageous status in the Society.
Let some facts be given. The low literacy rate (40%), low work participation rate (28%) and low urban population share (10%) of women as compared to 60%, 52%, and 18% respectively of their male counterparts well confirm their disadvantageous position in the society. Nonetheless, the presence of women as entrepreneurs is increasing which has led to the change in the demographic characteristics of the business and economic growth of the country.
According to the Google and Bain & Company report, “When provided with equal access to inputs, women-owned enterprises produce equally strong economic outcomes when compared with enterprises led by men. Women’s employment contributes to outsized social returns as women invest most of their income on children’s health and education, benefitting future generations.” A HerStory’s Women Entrepreneurship in India report published in 2019, reveals that funding raised by all-female founding teams in India in 2018 was an abysmal 0.63% of the total USD 13 billion raised by entrepreneurs in the ecosystem.
There are several examples of countries, some in similar stages of development as India, and states within India, that have structurally enabled and accelerated entrepreneurship amongst women. Examples include developed countries such as the US and Canada that have ~40% enterprises owned by women, and developing countries such as Indonesia, Vietnam and Russia, that have over 30% women-owned enterprises. Within India, several states, including Meghalaya, Mizoram, Manipur, Tamil Nadu, Karnataka lead in the representation of women in the MSME sector. An all-states effort that is focused on enabling women entrepreneurs to start up and scale could, by 2030, increase direct employment by around 50 million to 60 million people and increase indirect and induced employment of another 100 million to 110 million people.
Given the continued scarcity of work opportunities, entrepreneurship allows women to be self-sustaining, giving them greater flexibility and control as opposed to salaried employment. Women’s economic empowerment will require government and policymakers, the banking ecosystem, investment community, private sector, focused catalysts, and women entrepreneurs to collaborate. Focused initiatives such as women-only self-help groups and incubators can improve networking and mentorship, tackling two of the social challenges to entrepreneurial success; especially in rural and semi-urban India.
For true advancement and employment gains, women’s entrepreneurship is a compelling solution to realise the demographic dividend, engage the female population, and accelerate social and economic outcomes. While entrepreneurship brings its unique challenges and positives relative to traditional employment, easing the environment and addressing gender-specific constraints will exponentially increase the vibrancy, returns and multipliers for India.