2021 The Year of Women-Owned Startups

It’s happening across America: the increase in women starting new businesses is twice that of businesses started by men.

Each day, over 1,800 new women-owned businesses are being started. And leading that growth are new businesses owned by women of color, accounting for nearly 90% of new women-owned businesses opening each day.

To put that in perspective, over the past five years, women-owned businesses increased 21%, while all business increased only 9%. The pandemic has accelerated new business growth even more. In 2020, new businesses opened at the fastest rate in more than a decade, according to government data.

On paper, things have never looked better for women-owned startups. Yet, the hurdles faced by women are often very different than those experienced by men. Here are some tips for women in today’s challenging business landscape.

Plan carefully, and make sure you can be flexible in the face of change. A detailed business plan can help build confidence and optimism. What is the feasibility of your business idea? Is there a need or demand for the kind of business you’re considering? Will your business be ‘pandemic proof’ and able to thrive in the months ahead? Consumer habits have changed significantly, so consider how your business could fill a need. Whether your business will be very small or large, the SBA provides valuable information for planning your startup.

Consider funding options beyond personal savings. Even the smallest businesses should look at some outside business financing to help build credit for future growth. Developing good, long-term financial planning will help insure your startup. Around 20% of small businesses in general fail in the first year usually due to a cash shortage. As you plan your business, carefully calculate when your business will make a profit and how much money you need to reach that point.

Build a support network. Support systems are crucial for women business owners. Mentors, employees, and partners can share advice, insights, and referrals to help. There are many free business resources for women small business owners including the American Business Women’s Association, Ellevate Network and National Association of Women Business Owners.

Protect your business. Make sure business Overhead Insurance (OE) Disability Insurance is included in your business plan. If you or an employee become too sick or unable to work for an extended period of time, your company could face real financial stress. Talk with an insurance professional about how you customize a BOE policy that best suits your startup.

Launching a startup during a global pandemic that will likely redefine business throughout most of 2021, is challenging. And even more so for women.

It’s disconcerting to know that women face more work-life balance challenges than men and fewer support systems – including funding – than men. But it’s not impossible. For women who take the steps to start up their own businesses, they find their well-being becomes much higher and most believe they achieve a positive work-life balance.

For women considering startups in 2021, there are many resources and a lot of advice: Have your business solve something meaningful. Have concrete goals. Tell everyone about your business. Have mentors and network with other women business owners. Don’t be afraid to find yourself pursuing an unexpected path.

Above all else, stay positive.