More women-focused interventions recommended
A new study shows that efforts to innovate by women entrepreneurs are not being recognized because of a dominant focus on technologies.
Titled Everywhere, Everyday Innovating – Women Entrepreneurs and Innovation, the report says women in Canada are innovating in all aspects of the business but are hampered by policies and programs that restrict the concept of innovation to technology and goods rather than services. Hence, other innovations in businesses aside from technological advancements – those often undertaken by women - are unrecognized.
About 90% of women are in the services sector but they are underrepresented in S&T. Women entrepreneurs do not view technology as the end product, the report noted. Instead, they consider technology as a tool to further their business vision and goals.
“Innovation needs to be inclusive. Women entrepreneurs are demonstrating this in action,” the report states. In the coast-to-coast study based on interviews with 146 diverse female entrepreneurs, including 23 Indigenous women, and a survey of another 1,000 female business owners, the report also notes that women are aware they have to innovate to be competitive and to stay in business.
Despite this, women entrepreneurs are experiencing difficulties in running and building their enterprises. Challenges range from access to capital, incubators and accelerators to commercialization. Women also experience harassment and sexism, and deal with other traditional gender-biased issues, such as finding childcare and aging. All these hinder their ability to innovate.
The report notes that women were being turned away by financial institutions because they were considered as high-risk. Women also experience harassment and sexism, and deal with other traditional gender-biased issues, such as finding childcare and "age challenges". For example, if they start their business after raising children, they can't qualify for some age-specific programs, like Futurpreneur, which is from 18-39 years old only. Some women entrepreneurs say they are excluded from opportunities in tech sectors and feel “less comfortable” in incubators and accelerators because these hubs are focused more on tech. These realities – culled from interviews, in-depth analyses, literature reviews and a roundtable discussion -- call for policies and opportunities to support women entrepreneurs, regardless of sector.
“Canada needs an innovative society, which can be fostered through recognition and support of innovators in all sectors,” the report summary reads. With this in mind, recommendations revolve around how to help “to build a truly inclusive innovation strategy” across all sectors, not just around new technologies.
“An inclusive innovation strategy will enable female entrepreneurs to thrive and the economy to benefit,” says Janice McDonald, co-author & president of The Beacon Agency, a consulting firm which collaborated on the report with research partners BMO Financial Group and Carleton Univ.
The report includes recommendations for government, financial institutions and women entrepreneurs. For governments of all levels, it suggests developing an inclusive innovation framework that’s consistent with OECD’s innovation policy and with Canada’s “feminist development policy.” The framework should also consider women entrepreneurs in policy design and commit to equitable grant funding.
“This strategy looks beyond science and technology to recognize that innovation is happening in all sectors, (and) would leverage the increasing growth and innovation of women entrepreneurs to Canada’s advantage and recognize the value of innovations from sectors where women-owned businesses are operating,” the report states.
Governments are also urged to make grants and programs accessible to women entrepreneurs and to reach out and make them aware that such opportunities exist.
Since assuming power in 2015, the Liberals have often trumpeted feminist and inclusive policies. Budget 2018 saw a strong push for this as it introduced a “gender results framework.” It also includes a “women entrepreneurship strategy” that is a comprehensive approach to help women entrepreneurs grow their business and remove barriers to growth. Several initiatives, including follow-throughs from Budget 2017 and new ones, are in the new budget.
Examples of programs continued from Budget 2017 include the venture capital catalyst initiative requiring proposals to outline plans to incorporate gender balance and diversity. Another is Innovative Solutions Canada, which urges small- and medium-sized enterprises to access procurement programs and also encourages government to buy from companies led by under-represented groups, such as women, Indigenous peoples, the disabled and youth.
New funding in Budget 2018 for women-led enterprises includes $105 million for five years, channeled through regional development agencies and intended for capital access, mentorship and training; $10 million over five years to help with export opportunities; $1.4 billion over three years for access to capital through the Business Development Bank of Canada, and a host of other initiatives in other business programs.
The report notes that women entrepreneurs should also learn more about available investment opportunities, establish relationships with financial institutions, and continuously upgrade their financial literacy and technical skills. They are also urged to seek funding from other women investors and educate male investors on the value of investing in women’s businesses.
In a statement, Bardish Chagger, minister of Small Business and Tourism, said a culture shift is in order. “As innovation changes our economy, women entrepreneurs will be key to our future success. We need more women in business – for our economy, and more importantly, for our society,” she added.
Financial institutions are urged to “address the bias many women entrepreneurs have against debt.” They are also asked to collaborate with different partners, such as academia, cities and industry, to be able to offer loans in accelerators and incubators.
The report concludes that much work still needs to be done “to create the robust eco-system that will ensure women entrepreneurs can fully contribute to the Canadian economy”. The study was funded by the three research partners and the government of Canada.