The Entrepreneurial Gender Gap: Obstacles Women Face When Building a Business

Women-owned businesses are on the rise. In 2021, 49% of all new start-ups in the U.S. were led by women. This is a rise from just 28% in 2019. The dramatic increase in women-led businesses may be partly due to the pandemic. It might have created a moment of opportunity for many would-be entrepreneurs.

However, women still face significant barriers when starting their own businesses. They are currently outnumbered 3-to-1 by men in the business world. Moreover women are more likely to feel the lingering economic impact of the pandemic.

Many entrepreneurial women also have to overcome stereotypes and misogyny on their journey toward business success. These barriers can be a significant obstacle for many women, who may abandon their dreams due to stigma and sexism.

Social Expectations

While social expectations for women have improved since the 1950s, it doesn’t mean that we live in an equal, egalitarian world today. Even though in the U.S., women make up 43% of the workforce and 50% of college graduates, only 35% of business start-ups are run by women.

The entrepreneurial gender gap also impacts the success of women-led businesses. Women-led businesses experience less growth and prosperity than men-owned equivalents, although their work is just as good as men’s.

It’s hard to pinpoint a single reason why women face a harsher business environment. Part of the answers may lie in understanding stereotypes and stigmas. When women enter the business world as an entrepreneur, they have to defy social expectations. In spite of the ideas that many folks have about business leaders being stereotypically masculine, women are expected to succeed.

Women also have to overcome broad social stereotypes when running a business. Misogynistic beliefs about “where women belong” harm women entrepreneurs. Likewise, unfounded beliefs about women’s competency and strength threaten to undermine the credibility of women-led businesses. In fact no data supports the idea that men are more competent as business leaders.

Many women leaders turn away from the notion that business needs to be “cutthroat” and unceasingly competitive. This may mean that women struggle to be taken seriously in the business world, even when their actual output is just as good as men’s. Fortunately, support groups and funding opportunities are seeking to do away with outdated stereotypes. They hope to give women access to the funding and financial freedom they need.

Funding and Financial Freedom

Without investment, a business idea is just that — an idea. Many women entrepreneurs struggle to find the funding they need and face a harder time when attempting to raise capital.

Part of the problem may be down to financial control. Women only control 33% of all U.S. household financial assets. They may be unable to make their own decisions about the way that they spend their money. This is a tell-tale sign of violence against women. It’s another barrier that women have to overcome when building businesses.

Fortunately, women-led businesses are sharing wealth and helping other women achieve their entrepreneurial potential. Grants and loans are available to women who want to start their own businesses. In the U.S. programs like the National Associate of Women Business Owners and the Association of Women’s Business Centers can help women secure funding. They also put them in touch with experts who can act as a mentor while women grow their businesses.

Women who are veterans can also secure specific funding to help them after life in the service. Funding for women veterans gives business owners access to the capital and guidance they need. Women vets can find support through programs like the VETS group, the Rosie Network, and Lift Fund.  

Networking and Growth

Starting a business is about more than funding and financial stability. Women who want to grow their businesses have to network and build relationships that lead to new opportunities. Unfortunately, much of the business world is run as a “boys club”. Some business owners still turn their back on women with a passion for entrepreneurship.

But women are trying to change that. They are supporting each other and undoing some of the harmful stereotypes that surround women in business. Groups like the Women’s Entrepreneurial Network can help women find support and guidance when they are starting a new venture.

Women can find further support through programs like the Women’s Business Development Center (WBCD) and the Women’s Business Enterprise National Council (WBENC). These nonprofits can help women scale their operations. They are two of the largest certified programs in the U.S.


Many entrepreneurs dream of living the C-Suite lifestyle and working on the top floor of tall, glass office buildings. However, others are more than happy running a business in their pj’s from the comfort of their own home.

The recent boom in micro-businesses can support women who want to work for themselves. During the pandemic Americans created 2.8 million online micro-businesses. Many folks took advantage of pandemic funding to start their own career as an entrepreneur.

Women lead the micro-business charge and now benefit from being their own bosses. However, many women entrepreneurs still feel the pressure of playing the role of a “wife” or “mom”.

Women who work from home can improve their work-life balance by renovating with simple DIY changes. Small changes, like repainting or adding custom shelves and storage can show everyone that the home office is a space for work and focus, rather than child care and play.

Co-working space is another option if they find that their family life impedes their business growth. Co-working spaces can also be a great way to meet like-minded entrepreneurs and discover new opportunities for funding and growth.


Running a business is tough — but it’s particularly difficult for women. Women entrepreneurs have to overcome social stigma and unconscious bias when running their businesses. Fortunately, women entrepreneurs can find support and funding through groups that help them overcome stereotypes and give them the opportunity they deserve.

About The Author

Ainsley Lawrence is a freelance writer from the Pacific Northwest. She enjoys writing about the ways technology, education, and wellness intersect and impact our everyday lives. She is frequently lost in a good book. Her other blogs for Sayfty include How to Stay Safe When Moving to a New City and The Importance of Women in Psychology.