Programs and Resources to Advance Women s Entrepreneurship. U.S. Small Business Administration Answers Resources Support For Your Small Business

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1 Programs and Resources to Advance Women s Entrepreneurship

2 Focus on Women s Entrepreneurship Since it was established in response to an executive order in 1979, the U.S. Small Business Administration s Office of Women s Business Ownership has fostered the participation of women entrepreneurs in the economy, especially those who have been historically underserved or excluded. In 1970 only 5% of all US businesses were owned and operated by women. Today there are over 7.8 million women owned firms, representing 28.7% of all nonfarm businesses Presidential Executive Order Established the Office of Women s Business Ownership within the Small Business Administration From 1997 to 2012, the number of women-owned businesses in the United States grew by 54%. Analysis by American Express suggests that the number of women-owned businesses has risen by 200,000 over the past year alone, which is equivalent to just under 550 new womenowned firms created each day.

3 Access to Capital Women entrepreneurs are less likely than their male peers to seek bank financing, resulting in women closing their businesses at a higher rate than men. Researchers find consistent evidence that businesses owned by people in legally protected and historically disadvantaged classes, including women, are more likely to be denied credit than are businesses owned by those in the majority class, even controlling for characteristics related to credit worthiness.

4 Access to Capital -Role of Government Although no government loan programs exist exclusively for women business owners, the Small Business Administration is one of the largest loan guarantors in the country and offers a variety of loan programs to small businesses. Continuum of loan products to help small businesses to start and grow. Each of the programs is dependent on a strong public private partnership. SBA does not make direct loans, but sets the guidelines for loans, which are then made by its partners The SBA guarantees that these loans will be repaid, thus eliminating some of the risk to the lending partners. So when a business applies for an SBA loan, it is actually applying for a commercial loan, structured according to SBA requirements with an SBA guaranty. The SBA program serve in many ways to fill the gaps in the lending market. As capital is more accessible, lenders use less of the SBA programs.

5 Access to Capital Women owned businesses, on average, receive less venture capital funding than men, and more than half of women-owned businesses used personal or family savings to start or acquire their business, compared to 60% of all businesses. SBA guarantees loans on reasonable terms through financing partners to small businesses that are unable to obtain funding from conventional lenders. According to the Urban Institute, SBA loans are 3 to 5 times more likely to go to women and minority owned businesses than conventional loans. And since 2009, the SBA has supported more than $12 billion in lending through more than 35,000 SBA loans to women-owned businesses.

6 Women s Business Ownership Act In 1988, the Women s Business Ownership Act established both the National Women s Business Council and the Women s Business Center Program. The Women s Business Center Program utilizes over 100 non profit organizations that provide business training and counseling, access to credit and capital, and marketing opportunities for women entrepreneurs. Each Women s Business Center tailors its services to the needs of its individual community, including offering services at convenient times for women. Many of the centers provide day care services and offer classes in multiple languages. Annually, approximately 140,000 clients are served by the Women s Business centers around the country, helping many to start and grow their businesses.