How She Hit the $1,000,000 Mark
Subscribe today for Free Enterprise Updates
- Latest business trends and best practices
- News about legislation and regulation impacting business
- Business how-to articles from industry experts
- Commentary and interviews with newsmakers in business and politics
Why are so few women business owners passing the seven-figure mark? Experts have attributed this trend to several issues, including math anxiety among women, the “good-girls-don’t-ask-to-get-paid” myth, and the “superwomen-can-do-it-all” complex. “I believe it is a stereotype that women are more interested in feeling good and helping others than making a profit,” says Nicole Fende, an independent consultant who runs a small business finance forum and author of the book How to Be a Finance Rock Star. Several women business owners who broke through that $1 million barrier spoke out on five ways to overcome these stereotypes.
1. Embrace Your Balance Sheet
Some sources contend that women, even the most successful ones, suffer from math anxiety, which hampers their ability to focus on their financials. A recent report by the U.S. Department of Commerce confirms that women are still shying away from science, technology, engineering, and math jobs, and a study commissioned by the National Academy of Sciences indicates that women teachers who are themselves anxious about their own math abilities are passing their anxiety on to young girls. The Los Angeles Times, which published the results of the study, said, “Perhaps math-anxious teachers call on girls to solve math problems less frequently; praise boys more effusively; or simply imply that it’s not important for girls to be good at math.”
Dawn Fotopulos is the founder of BestSmallBizHelp.com and an associate professor of business at The King’s College in New York City. She counsels women business owners on how to overcome math fears and manage their businesses better. “Some women have difficulty asking for money feeling like they’re being greedy if they ask for payment,” says Fotopulos. “Many want to be liked more than respected. Women often abdicate the interpretation of their financials to their accountants and treat reading financial statements like riding on a motorcycle with their boyfriend; it’s the guy’s job to steer.”
If you are fundamentally not a math girl, admit it and get some help. “Acknowledge the fear and lay out a plan to get some basic knowledge,” says Fende. “Look for free training, take a community college course, or pick up an easy-to-understand book. Don’t be embarrassed to ask questions and ask for help.”
Sarah Endline goes by the title of mastermind and chief rioter of sweetriot, a thriving candy company. She has used an open-book financial management system with all full-time rioters (her employees) since the company’s inception in 2005. “I believe openness about all numbers, from revenue to cash balance in the bank, empowers team members and creates a higher level of accountability across the company,” she says.
2. Conquer the Capital Conundrum
Julia Pimsleur, founder and CEO of Little Pim, which produces multi-media language-learning products for children, raised $1 million in capital, and used it to hire staff and take her product line from DVD to digital distribution, including iPad and iPhone apps. Pimsleur believes that securing funding was more difficult because of her gender. She asserts, “I may not have raised as much capital as a man would have in my shoes. As a woman, I feel the desire to ‘play it safe’ is fairly engrained.”
Knowing where to spend money is as important as having it to spend, according to Pimsleur. “If I had it to do over again, I would have raised more capital and spent more on marketing. Launching a new brand in a very crowded and competitive space takes more than just grassroots marketing efforts such as social media.”
As a result of the funding issues women face, there are now several organizations focused on working with women entrepreneurs. WomanOwned.com features a list of resources that they view as “woman-friendly” capital sources. Golden Seeds is a venture capital firm that focuses on women entrepreneurs.
3. Think Scale and Delegate
Some women start businesses based on a passion or personal connections or interests, but then need to think through how they can scale up their concept for growth. Lynne Lambert, president/owner of NYC Subway Line, is a former actress with no prior experience in product manufacture and marketing. Inspired by a subway sign during a commute, she started out designing and marketing transit-based clothing in 1995. She was able to generate $1 million by 2007 and has since expanded her line to include accessories such as laptop cases featuring transit maps. She recently signed a deal with Apple for a New York–based retail test. If successful, the laptop cases will be tailored for other cities’ transit systems and Apple stores. “In order to hit the million dollar mark, I had to accept the fact that I needed to get help—especially administrative and sales manpower. I’ve found that women have a tendency to want to do things themselves because they don’t want to over-spend and they are used to doing many jobs—both personally and professionally—without assistance. Maybe we feel we don’t deserve the help. I had to have the concept of delegation knocked into my head. I couldn’t build my overall vision and grow while doing every job.”
When preparing to scale, Sharon Rowe, founder of Eco-Bags Products, also hit the million dollar mark in 2007 following an Oprah segment featuring her product. In addition to direct-to-consumer sales, she focused on private-label products, resulting in higher-ticket sales. “Expand cautiously,” says Rowe, whose sales have exceeded $1 million every year since 2007. “Expansion isn’t all that easy and it eats up capital. Expand slowly even if you are experiencing hyper growth [in terms of sales]. We considered every new order carefully and reined–in new initiatives. Early on, we made some mistakes. We added people and took on office space very quickly. We built out our infrastructure to accommodate our growth, but we weren’t ready for when our business retracted after the economy slowed down and competition increased.”
4. Never Go It Alone
Financial advisors are not the only people who should be in your inner circle as you build a business. “A lot of people in small business believe it’s all up to them,” says Nell Merlino, founder, president, and CEO of Count Me In for Women’s Economic Independence. “Anyone who has been successful has had people helping them.” Several of the women we spoke to admitted that because they were used to multi-tasking and handling both work and family duties prior to starting their businesses, that they were hesitant to ask for help in the early days of their entrepreneurial ventures.
Suzy Jurist of SJI Associates, a company that offers branding and graphic design services, started her business in 1991. She reached the million dollar mark her first year and has achieved gross revenues of over $1 million every year since then, generating more than $9 million in 2011. She credits her success to the talented people (currently 20) who work for her. She says, “Focus on staff satisfaction.”
5. Balance: Wife…Mother…Millionaire?
Meg Hirshberg is the author of For Better or For Work: 7 Lessons for Entrepreneurs with Families and wife of Stonyfield Yogurt cofounder and chairman, Gary Hirshberg. Hirshberg, who helped grow Stonyfield to $370 million in sales, contends that many women who start businesses select “lifestyle-adjusted businesses,” rather than those that have potential for growth. “Women may have a different definition of success,” she asserts. “If you build a highly successful business but lose your family in the process, you’ve had your eye on the wrong ball.”
Balancing a family with a growing business can be difficult, for both men and women. Says Pimsleur, the mother of two, “I am not a supermom and not trying to be one. I am just one person. I try to treat my family and work life as a kind of yin and yang, not a tug of war. I think I’m a better mother because my work is creatively and intellectually satisfying.”
Rupila Sethi, principal of Aerial Design and Build, is another mom millionaire. She gave birth to two children while growing her business. Although she believes that her business could have grown at a faster pace during that time, she stresses the importance of family. “You also need to be sure to allow for personal time so that your mind has time to breathe,” she says.
According to a recent national study by American Express Open, women-owned companies account for almost 30 percent of all businesses (8.3 million businesses), generate nearly $1.3 trillion in revenue, and employ close to eight million people. The number of women-owned businesses has increased by 50 percent since 1997, exceeding the number of businesses started by men by more than 37 percent. Yet, just 1.8 percent of women-owned businesses generate more than $1 million in annual revenues.
Nancy A. Shenker is the CEO/founder of theONswitch, and is the co-author of Don’t Hook Up With the Dude in the Next Cube: 200+ Career Secrets for New Grads. She can be reached at firstname.lastname@example.org.