Women business owners can find it hard to be taken seriously even as their companies grow into multimillion-dollar enterprises.
That’s the finding of a report released last week by Babson College and Bank of America that analyzed the challenges women encountered as they were building their companies. Rather than doing a traditional survey to compile their report, the researchers who wrote the report did lengthy interviews with 30 women who own businesses that have surpassed $5 million in revenue.
Many of the owners said they were misunderstood and discounted by other business people including investors. The report found that women owners encountered mistaken assumptions about why they launched their companies.
“When a woman starts a business, some potential backers may assume that she is running the business out of her home, for fun, or just to supplement her family’s income,” the report said. “Backers may then fail to see the business as growth-oriented and worthy of investment.”
Their products or services can also be devalued, especially if the target customers are women or mothers. The report quoted Raegan Moya-Jones, co-founder of baby products manufacturer Aden & Anais, as saying, “business people didn’t, and still don’t, take me seriously a lot of the time.” The negative judgments persisted although Aden & Anais products are sold in retailers including Walmart and Bloomingdale’s and the company has annual revenue over $100 million.
Darlene Panzitta, founder of DSP Clinical Research, said she encountered doubts because she was young as well as a woman.
“It was a double whammy of, ‘OK, she’s female, plus she’s young so she’s not going to be aggressive,'” said Panzitta, whose company conducts research on women’s health issues.
Owners also encountered perceptions that they weren’t running companies with an eye to expanding them and creating wealth, something that male owners were expected to do. Instead, they found they were being perceived as merely pursuing a project because they were passionate about the idea behind the business.
The negative attitudes have continued even as the growth rate for women owned companies has surpassed that of businesses in general. A report released last month by American Express found that the number of companies owned by women owned by women grew by 21.3% between 2014 and this year, compared to 9% growth for companies overall.