When asked how the pandemic affected their businesses, according to recent surveys*, half of female early-stage entrepreneurs agreed it created new business opportunities; one quarter reported it prompted the use of new digital technologies; and over half confirmed they expect to adopt more digital technologies in the coming months. Yet in 2023, men entrepreneurs are still twice as likely as them to raise more than 100k $ in funding. More often choose more innovative sectors, and start their businesses earlier in their lives (40% begin before 35, and 8% before 25.)
Globally women are active entrepreneurs. And almost everywhere, they face similar challenges. Undoubtedly some places are more attractive for them to create and develop initiatives. Then, the question arises: Which is the best city for female-created businesses? According to Dell Women Entrepreneurs (WE) City Index, this year, it is London.
Exploring 5 main areas (market, talent, capital, culture and technology) and looking at different sub-pillars, the annual report presented by Dell Technologies and Dell Women’s Entrepreneurs Network (DWEN) measures the conditions and opportunities offered by the 55 cities considered to compile a list of the best for female entrepreneurs.
UK’s capital grabs the first position in 2023. Still, it has always been on the top since the Index’s conception, thanks to its access to talent (its 22 universities are among the best in the world), crowdfunding and investments in venture capital opportunities. New York occupies the second position for its better and even easier access to funding. It falls short in the areas of talent and working environment. In the third position comes San Francisco. This city offers better access to technology and scores very well in the pillars of market and capital.
Only two European cities, Paris (4th) and Stockholm (5th), are among the best 10. Leaving the US to prevail (numerically) in this group of “first”; following NY and San Francisco, Chicago is in 6th position, Los Angeles 7th, and Boston in the 10th. The remaining spots are occupied by Toronto (8th) and Sidney (9th). Even if the list includes many Asian cities, the first one to appear is Singapore, ranked 22nd. The first and only Italian to appear in the Index is Milan, in 38th position.
Global challenges
The Dell WE City Index doesn’t hide the lasting limits and threats for female entrepreneurs, especially regarding investments and funding. “The fact that capital is where most cities have their weakest score reinforces that this is still a missing piece of the ecosystem for many women to be able to scale their business.”
Women entrepreneurs seeking investors undergo a more arduous quests, even to pitch their ideas. Recently, some more opportunities to survive&thrive come from groups of angel and business investors around the world who focus solely (or mainly) on female-founded startups. Still, we cannot go around it: The rules and system sustaining entrepreneurship are based on long-lasting norms designed by and for men.
As in other parts of the business world, female entrepreneurs also have to face enduring stereotypes and the feeling they need to adapt to a “male” attitude. More often than not, especially when moving their steps in man-dominated industries, they are taken less seriously, fuelling some issues of personal affirmation. Yes, some trends are changing, but thus far, girls, who are more often (subtly or not) taught to underplay their accomplishments, can turn to become less comfortable in owning their value as leaders.
If that was not enough, the choice of sectors in which to operate could help boost or limit a business. Today, almost half of women enterprises are involved in Wholesale/Retail—but only 2,7% in ICT – fields that currently attract the most investments. In comparison, 4,7% of men enter these sectors.
In terms of age and education, the differences between gender appear less evident. Yet, not surprisingly, differences in household income are still clear, and women remain much less affluent. Possibly influenced by this instance, they tend to start their enterprise without employees and are less likely than men to begin with more than 20.
Access to capital and better policies
Aiming to support women entrepreneurs through DWEN, the Dell WE City Index compiles also inputs to create better environments for businesses. It suggests interventions like creating targeted resources from women enterprises at different stages of development to allow easier access to capital (via lending, crowdfunding, or accelerators). The report confirms, “Even with the progress made since the previous index, the capital pillar remains the weakest area for the majority of the WE Cities. The importance of capital to women entrepreneurs is evident by the fact that 9 of the top 10 cities also appear in the top 10 rankings of the capital pillar.”
But as it turns out, it is not all about money. In order to support women’s businesses, the advice is also to improve parental leave and childcare benefits and strengthen pay transparency policies. And collect “sex-disaggregated data, particularly in the area of technology access, and making those data public – what gets measured gets done.”
Indeed, besides considerations strictly related to capital, the ease of doing business and the costs of living in certain areas, the prevalence of certain social attitudes and the possibility to access mentors and role models can limit, threaten or, conversely, advance women’s enterprises.
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* Findings form “GEM 2021/22 Women’s Entrepreneurship Report: From Crisis to Opportunity”, Global Entrepreneurship Monitor.
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