Only 17% of 25- to 34-year-old women have attained a tertiary education in South Africa. This is one of the lowest among African countries according to the Organisation for Economic Co-operation and Development.
Knowledge is power,
especially in the case of women business owners who may not have received
formal education because of gendered career paths. If you are looking to
upskill, organisations such as Get Smarter and the Cape University of
Technology, offer business management short courses targeted at entrepreneurs
in South Africa.
A less formal route of
financial and business education is also an option, with sites like Fincheck
Academy and Sage’s blog being invaluable resources for entrepreneurs. Financial
literacy is key for women entrepreneurs. It allows them to be in control of
their money and to make smart decisions about costs and cash flow. This is
vital for small businesses, as it can help them increase their chances of
survival.
Networking and
leveraging your communities are especially important in your early growth
stages. Building these strong networks can lead to business growth, but also
increased confidence which is something women leaders often lack.
According to Harvard
Business Review, women can benefit from taking a strategic approach
to networking. The report further states that focusing on a higher level of
centrality and connecting with people who are connected to multiple networks
should be vital in your strategy.
LinkedIn reiterates this
need to get started on networking, with 14% to 38% of women globally being less
likely than men to have a strong network – one that’s both large and diverse.
Organisations like Future Females, a community-based learning experience for
women, and Women Who Build Africa, a network for women in tech, offer women in
South Africa an opportunity to thrive in the business world.
“Entrepreneurship is a
team sport,” says Lauren Dallas, co-founder and chief executive of Future
Females. “Having a network of supportive peers, mentors, coaches and team
members is critical for success. At Future Females, we approach
networking like any other function in our business.
“My co-founder, Cerina,
and I have targets each month for the number of connections made, and
relationships built – whether it’s online through LinkedIn or community groups
or online at events or through social circles. After all, people buy from
people.”
Access to finance
Business funding is
probably one of the biggest barriers for women entrepreneurs. For example, in
2019 we saw less than 5% of VC funding for African start-ups going towards
companies with female founders.
In Sub-Saharan Africa
currently, there is a $42 billion dollar funding gap for women entrepreneurs,
and if the gender gap is bridged, it’s estimated that a $316 billion GDP could
be gained by 2025. These statistics highlight the need for new lending models
and more women-focused lending institutions.
Women entrepreneurs in
South Africa generally own fewer assets than men, and because they don’t have
this collateral it often makes the loan process more difficult. Lending
networks like Xena Capital, give women access to funding tailored to their
needs – by doing so, they are unlocking the potential of the women economy.
FundingHub is another
such platform which puts the power at the fingertips of the borrower, by
letting she-preneurs choose between offers from various lenders. According to
Sage, women manage credit much better than men do, and when invested in, women
have a 27% credit turnover, compared to 8% in a male-run business.
Empowering women entrepreneurs
Lara du Plessis, head of
product and partnerships at FundingHub, says, “Historically finance has been a
male-centred part of businesses, however, today business finance comparison
platforms like FundingHub, make access to finance more tangible for female
entrepreneurs, saving them time and money.
“FundingHub goes beyond
comparing offers, they break down the details of all the different kinds of
business finance out there in South Africa so that SMEs ultimately get the best
finance for their business needs. If female entrepreneurs can confidently own
their business finance journey, it places them in a better position to grow and
scale their business venture”.
Government, especially,
needs to take the necessary steps to give women entrepreneurs better financial
support. NEF Women Empowerment Fund and Isivande Women’s Fund, are two such
funds (aimed at black female business owners) that have been created with the
help of both the government and large banks.
Having formal financial
structures like these in place for women to use, will catapult their businesses
from ideation to success in no time. There’s no denying that businesses led by
women are just as profitable as those led by men, if not more so. But what’s
even more valuable is that these businesses are more likely to have a positive
social impact.
“The majority of our
members have found the network incredibly useful for building much needed
connections and seeking advice ranging from how to market their business, to
scaling their business, and how to pitch their businesses to investors,”
explains Cate Williams, head of product at Xena.
“Not surprisingly,
though, one of the most frequently asked questions is where to get funding for
their business. Our data suggests that a mere 5% of female entrepreneurs have
taken business funding offered by traditional banks, with most having been
declined business loans due to outdated and irrelevant scorecards or lending
criteria.”
If women are to be equal
players in the entrepreneurship game in South Africa, support needs to be
facilitated by government, lenders, private companies and mentors. This support
combined with the drive and determination to succeed will be pivotal in growing
the number of thriving women-owned businesses.
Source: ventureburn