Growth-oriented Women Entrepreneurs and their Businesses NEW HORIZONS IN ENTREPRENEURSHIP Series Editor: Sankaran Venkataraman Darden Graduate School of Business Administration, University of Virginia This important series is designed to make a significant contribution to the development of Entrepreneurship Studies. As this field has expanded dramatically in recent years, the series will provide an invaluable forum for the publication of high-quality works of scholarship and show the diversity of issues and practices around the world. The main emphasis of the series is on the development and application of new and original ideas in Entrepreneurship. Global in its approach, it includes some of the best theoretical and empirical work, with contributions to fundamental principles, rigorous evaluations of existing concepts and competing theories, historical surveys and future visions. Titles include original monographs, edited collections and texts. Titles in the series include: A General Theory of Entrepreneurship The Individual–Opportunity Nexus Scott Shane Academic Entrepreneurship University Spinoffs and Wealth Creation Scott Shane Economic Development Through Entrepreneurship Government, University and Business Linkages Edited by Scott Shane Growth-oriented Women Entrepreneurs and their Businesses A Global Research Perspective Edited by Candida G. Brush, Nancy M. Carter, Elizabeth J. Gatewood, Patricia G. Greene and Myra M. Hart Growth-oriented Women Entrepreneurs and their Businesses A Global Research Perspective Edited by Candida G. Brush Babson College, USA Nancy M. Carter University of St. Thomas, USA Elizabeth J. Gatewood Wake Forest University, USA Patricia G. Greene Babson College, USA Myra M. Hart Harvard Business School, USA NEW HORIZONS IN ENTREPRENEURSHIP Edward Elgar Cheltenham, UK • Northampton, MA, USA © The DIANA Project, 2006 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical or photocopying, recording, or otherwise without the prior permission of the publisher. Published by Edward Elgar Publishing Limited Glensanda House Montpellier Parade Cheltenham Glos GL50 1UA UK Edward Elgar Publishing, Inc. 136 West Street Suite 202 Northampton Massachusetts 01060 USA A catalogue record for this book is available from the British Library Library of Congress Cataloguing in Publication Data Growth-oriented women entrepreneurs and their businesses: a global research perspective/edited by Candida G. Brush … [et al.] p. cm. — (New horizons in entrepreneurship) 1. Businesswomen. 2. Women-owned business enterprises. 3. New business enterprises. 4. Entrepreneurship. I. Brush, Candida G. II. Series. HD6053.G765 2006 338.6’422—dc22 2005050166 ISBN-13: 978 1 84542 289 9 ISBN-10: 1 84542 289 9 Printed and bound in Great Britain by MPG Books Ltd, Bodmin, Cornwall Contents List of contributors vii PART ONE COUNTRY REPORTS ON WOMEN’S ENTREPRENEURSHIP 1 Introduction: the Diana Project International 3 Candida G. Brush, Nancy M. Carter, Elizabeth J. Gatewood, Patricia G. Greene and Myra M. Hart 2 Women’s entrepreneurship in Australia: present and their future 23 Mary Barrett 3 Women’s entrepreneurship in Canada: progress, puzzles and priorities 53 Jennifer E. Jennings and Michelle Provorny Cash 4State of the art of women’s entrepreneurship, access to financing and financing strategies in Denmark 88 Helle Neergaard, Kent T. Nielsen and John I. Kjeldsen 5 Women’s entrepreneurship in Finland 112 Anne Kovalainen and Pia Arenius 6 Women’s entrepreneurship in Germany: progress in a still traditional environment 128 Friederike Welter 7 Women’s entrepreneurship in Norway: recent trends and future challenges 154 Lene Foss and Elisabet Ljunggren 8 Women’s entrepreneurship in the United States 184 Candida G. Brush, Nancy M. Carter, Elizabeth J. Gatewood, Patricia G. Greene and Myra M. Hart PART TWO RESEARCH TOPICS ON THE GROWTH OF WOMEN-OWNED BUSINESSES 9 Comparing the growth and external funding of male- and female-controlled SMEs in Australia 205 John Watson, Rick Newby and Ann Mahuka v 10 Builders and leaders: six case studies of men and women small proprietors in the Bulgarian construction industry 232 Tatiana S. Manolova 11 Access to finance for women entrepreneurs in Ireland: a supply-side perspective 259 Colette Henry, Kate Johnston and Angela Hamouda 12 Women entrepreneurs in New Zealand: private capital perspectives 284 Anne de Bruin and Susan Flint-Hartle 13 The supply of finance to women-led ventures: the Northern Ireland experience 308 Claire M. Leitch, Frances Hill and Richard T. Harrison 14 Female entrepreneurial growth aspirations in Slovenia: an unexploited resource 330 Polona Tominc and Miroslav Rebernik 15 Spain – the gender gap in small firms’ resources and performance: still a reality? 348 Cristina Díaz and Juan J. Jiménez 16 Gender, entrepreneurship and business finance: investigating the relationship between banks and entrepreneurs in the UK 373 Sara Carter, Eleanor Shaw, Fiona Wilson and Wing Lam Index 393 Contentsvi vii Contributors Pia Arenius, PhD, is Assistant Professor of Technology Management at Ecole des Hautes Etudes Commerciales (HEC), University of Lausanne in Switzerland. Her research interests include entrepreneurship, social capital and innovation management. Mary Barrett, PhD, is Professor and Director of the Graduate School of Business and Professional Development, and Sydney Business School, both located within the University of Wollongong, Australia. Her research focuses on gender issues in workplace communication; women business owners; and family business, including the role of women in family business. Candida G. Brush, DBA, is Chair of the Entrepreneurship Division at Babson College, Wellesley, Massachusetts and holder of the President’s Chair in Entrepreneurship. Her research investigates resource acquisition strategies in emerging organizations, the influence of gender in business start-up and growth strategies of women-led ventures. Nancy M. Carter, PhD, is the Vice President of Research at Catalyst, in New York City, NY. In this role she leads Catalyst research teams in developing groundbreaking research and consulting on issues relating to building inclusive environments and women’s advancement in the workplace. Dr Carter also holds the Richard M. Schulze Chair in Entrepreneurship at the University of St. Thomas, Minneapolis, Minnesota. Sara Carter is Professor of Entrepreneurship in the Department of Manage- ment and Organization, University of Stirling, Scotland. Her research interests include gender, rurality and multiple business ownership. Her chapter was written when she was Professor of Entrepreneurship at the University of Strathclyde, Scotland. Michelle Provorny Cash is an organizational consultant, editor and writer based in Edmonton, Alberta, Canada. Her research interests include social entrepreneurship, women’s entrepreneurship, micro-finance and community economic development. She currently serves as Managing Editor for Social Enterprise Reporter, a monthly publication about social enterprise. Contributors Anne de Bruin, PhD, is Professor of Economics in the Department of Commerce, Massey University at Albany, Auckland. Her research interests include entrepreneurship, career theory, labour market dynamics, non- standard work and pathways to sustainable employment. Cristina Díaz is a lecturer in the Department of Business Administration at the University of Castilla-La Mancha (Spain). Her research interests are related to entrepreneurship, in particular with the resource mobilization and outcomes obtained by female entrepreneurs in comparison with their male counterparts. Susan Flint-Hartle is Senior Lecturer in the Department of Finance, Banking and Property, Massey University at Albany, Auckland. Her research interests include franchising in the real estate agency sector, entrepreneurship and organizational learning. Lene Foss, PhD, is Associate Professor in Entrepreneurship and Organizational Development at the University of Tromsø, Norwegian College of Fishery Science in Norway. She holds an Associate Professor II position at the Department of Industrial Economics and Technology Management at The Norwegian University of Science and Technology in Trondheim, Norway. Her research interests include women entrepreneurship and leadership, emerging industries and entrepreneurial networks. Elizabeth J. Gatewood, PhD, is director of the University Office of Entrepreneurship and Liberal Arts at Wake Forest University, Winston-Salem, North Carolina. Her research interests include the factors influencing the success of women entrepreneurs, including access to resources for growing ventures, and entrepreneurial cognition. Patricia G. Greene, PhD, is Dean of the Undergraduate School at Babson College, Wellesley, Massachusetts, where she holds the President’s Chair in Entrepreneurship. Her research interests are the identification, acquisition and combination of entrepreneurial resources, particularly by women and minority entrepreneurs. Angela Hamouda, MBS, is a research coordinator with the Centre for Entrepreneurship Research at Dundalk Institute of Technology, Ireland. Her research interests include female entrepreneurship, in particular financial and networking supports for female entrepreneurs. Richard T. Harrison is Dixons Chair of Entrepreneurship and Innovation, and Director of Research, at University of Edinburgh Management School. His primary research interests include entrepreneurial finance (business angels, early stage venture capital), entrepreneurial learning and entrepreneur- ship and public policy. viii Contributors Myra M. Hart, Professor of Management Practice in Entrepreneurship at Harvard Business School, Boston, Massachusetts, conducts research on entrepreneurship, venture capital and women business owners. Her experience as a founder of a large-scale public company informs her teaching in MBA, executive education and alumni programmes. Colette Henry, PhD, is Head of Department of Business Studies and Director of the Centre for Entrepreneurship Research at Dundalk Institute of Tech- nology, Ireland. Her research interests include entrepreneurship education and training – programme design and evaluation; female entrepreneurship and entrepreneurs in the creative industries. Frances Hill is a senior lecturer in the School of Management and Economics, Queen’s University Belfast. Her research interests include organizational change and innovation especially in relation to industry incumbents; the behavioural and interpersonal dimensions of technology transfer; inter- and intra-organizational learning; the education and training of aspiring/nascent entrepreneurs; issues surrounding the financing of new and growing business ventures; social entrepreneurship. Jennifer E. Jennings, PhD (formerly Jennifer Cliff), is an Assistant Professor in the Department of Strategic Management and Organization at the Univer- sity of Alberta. Her research interests include the differential experiences and outcomes of male and female entrepreneurs, the determinants and consequences of imitative versus innovative entrepreneurship, and issues at the nexus of entrepreneurship and family. Juan J. Jiménez, PhD, is Academic Director of the Vicerrectorate of Albacete and Entrepreneurial Projects at the University of Castilla-La Mancha (Spain) where he holds a Chair in Business Administration. His research interests are entrepreneurship, SMEs and the promotion of an entrepreneurial culture. Kate Johnston, PhD, is a Senior Researcher with the Centre for Entrepreneurship Research at Dundalk Institute of Technology, Ireland. Her research interests include entrepreneurship growth and funding strategies, applied financial economics and corporate governance. John I. Kjeldsen holds an MSc in Economics and Business Administration and a Graduate Diploma in Business Administration and Marketing. He is Associate Professor at the Department of Marketing, Informatics and Statistics, Director of Study (Open University) and coordinator of the Diploma in Business Administration and Marketing at the Aarhus School of Business, Denmark. His research areas include Industrial Marketing Management, Buyer Initiative, Purchasing and Strategic Supplier Development, Entre- preneurship and Development of Small and Medium-sized Enterprises. ix Contributors Anne Kovalainen, PhD, is Professor of Entrepreneurship at two Finnish Universities, at the Department of Management and Organization, Turku School of Economics and Business Administration, Turku, Finland and at the Swedish School of Economics and Business Administration, Helsinki, Finland. Her research interests range from entrepreneurship theory and economic sociology including non-standard work, self-employment, entrepreneurship and labour market restructuring to feminist theory and research methodology in social sciences. Wing Lam, PhD, is Research Fellow in the School of Business and Management at the University of Glasgow, UK. Her research interests include new venture creation, family business, Chinese entrepreneurship, network and cross-cultural entrepreneurship. Claire M. Leitch is a Senior Lecturer at Queen’s University, Belfast. Her research interests include the company development process in the learning company; the application of action learning and other client-centred learning approaches, within entrepreneurial education; the dynamics of leadership in the process of organizational transformation; entrepreneurial learning, business development; and the technology transfer process. Elisabet Ljunggren, PhD, is senior researcher and research manager at Nordland Research Institute, Bodø, Norway. Her research interests include gender aspects of entrepreneurship, the entrepreneurial process, the household dimensions in entrepreneurship and policy initiatives to enhance entrepreneur- ship and innovation. Ann Mahuka is a Master of Finance student in Accounting and Finance at The University of Western Australia. Tatiana S. Manolova is Assistant Professor of Management at Bentley University, Boston, MA. Her current research interests include competitive strategies for new and small companies, international entrepreneur- ship and organizational formation and transformation in transitional economies. Helle Neergaard, MSc, PhD, currently holds an Associate Professorship in Entrepreneurship at the Department of Management and International Business, the Aarhus School of Business, Denmark. Her research interests include strategic and managerial aspects of entrepreneurship, female entrepreneurs, internationalization as well as qualitative methods. Rick Newby is a Lecturer in Accounting and Finance at The University of Western Australia. His research interests include survey methodology and the relationship between SME owner goals and firm performance. x [...]... research showed that women entrepreneurs seldom acquire sufficient funds to grow their businesses aggressively and to reach their full potential This raised a new question: Do women face unique challenges in acquiring growth capital? While the collective research documents demand by women entrepreneurs for equity capital, there was and still is a mismatch between the women, their ventures and sources of... financial resources, their financial reserves and strategies for funding their businesses, their choice of industry, and their reasons for starting businesses US women frequently become business owners because it provides a way to balance career and family needs The authors conclude that the number of women with higher aspirations is increasing But for these women, institutional and cultural barriers... Anne de Bruin and Susan Flint-Hartle present findings of an in-depth study of the demand and supply of private capital for New Zealand women entrepreneurs Their research explores the experiences of ‘successful’ women entrepreneurs, that is, those whose businesses had moved beyond the initiation phase and were commercially viable Because the industry is somewhat undeveloped in New Zealand and research... participating in both Diana International and GEM illustrate this point, with the TEA for women ranging from 2.79 (Sweden) to 12.02 (New Zealand) (Minnetti and Byrave, 2003) Table 1.1 Statistics on women and business ownership Percent of women in population Australia Bulgaria Canada Chile China Denmark Finland Germany Hungary Ireland Korea Northern Ireland Netherlands New Zealand Norway Slovenia Spain Sweden... Norway, only 20 percent of women- led businesses (compared with 31 percent of men-owned business) have one or more employees, and businesses owned by men show stronger financial results In the Netherlands, about 30 percent of entrepreneurs are female (approximately 250000 female entrepreneurs) , but their profile and that of their businesses are quite different from those of male entrepreneurs In Canada,... wideranging overview of the state of women s entrepreneurship Welter documents that women account for approximately 28.5 percent of the East and West German labor force and that the percentage of women s entrepreneurship is growing Overall, the 1990s saw an above average increase for women startups, but, the gender gap remains Women tend to be clustered in services and retailing and compared with men, are less... et al., 2005) With increasing numbers of women starting new businesses worldwide, it is crucial to answer these questions to gain a better understanding of how to promote women s entrepreneurship, eliminate obstacles women may face in business creation, and facilitate the growth process of their businesses A lack of understanding of the growth of women- owned businesses might ultimately inhibit competitiveness... education for women on the role of financing, and encouragement of financial providers to seek out and consider women- owned firms as investments is suggested RESEARCH TOPICS ON THE GROWTH OF WOMEN- OWNED BUSINESSES Seven chapters from Australia, Bulgaria, Ireland, New Zealand, Northern Ireland, Slovenia, Spain and the UK offer focused empirical discussions of factors influencing growth of women- owned businesses. .. produce innovation and wealth for the benefit of individual entrepreneurs, their families and, ultimately, their communities Simultaneous to the Diana Project research, interest in women entrepreneurs and growth of their ventures was rising in most countries around the world To capture and leverage that interest, the Diana Project team, in partnership with ESBRI (Entrepreneurship and Small Business... workforce and as business owners, and of the indicators of their current and likely future status as entrepreneurs It explores the Australian research on what these statistics show about how women and their businesses differ from their male counterparts, especially in terms of business size, motivation for entrepreneurship, access to start-up and growth finance, training and assistance, strategic choices . Development Through Entrepreneurship Government, University and Business Linkages Edited by Scott Shane Growth-oriented Women Entrepreneurs and their Businesses A. Perspective Edited by Candida G. Brush, Nancy M. Carter, Elizabeth J. Gatewood, Patricia G. Greene and Myra M. Hart Growth-oriented Women Entrepreneurs and their Businesses A