EXPERT PANEL | Women’s entrepreneurship – Malin Malmström

Twice as many men as women run businesses in Sweden. What are the reasons for this? And what are the bright spots for more equal entrepreneurship, according to the researchers? This week we ask an expert panel of three professors and one associate professor. Third out is Malin Malmström, Professor of Entrepreneurship and Innovation at Luleå University of Technology. She argues that public funding needs to be redirected to women entrepreneurs in female-dominated sectors.

What is equal entrepreneurship?

– I would say that if the conditions for starting and running a business are equal for women and men. By conditions I mean, for example, that women and men have equal opportunities to access finance, which is not the case today. For example, extensive research shows that women entrepreneurs are more likely to be refused loans than entrepreneurs that are men and when women are granted loans, they pay higher interest rates than men.

– Studies also show that women entrepreneurs are treated and judged differently from male entrepreneurs, to their detriment. And when the conditions for entrepreneurship are not equal, there are knock-on effects such as new innovations, new technologies and new processes being based mainly on men’s experiences and men’s needs.

– Then we may need to understand entrepreneurship from more perspectives than what is currently measured and made visible. Much of the focus is on women and men running businesses, such as the distribution of women and men in CEO and board positions. But ownership, for example, is also important. However, there is no availability of good data on ownership by gender. Such data is essential to better nuance the picture of how women and men participate in entrepreneurship.

What are the bright spots and concerns you see in the sky when it comes to gender equality in entrepreneurship and small business?

– In Sweden, the proportion of women who are entrepreneurs is rather stagnant. This is perhaps not surprising as the conditions for entrepreneurship are not changing – for example, it is reported annually that only about 1% of venture capital goes to women entrepreneurs. However, one bright spot is the emerging impact investors who have entered the venture capital market and who in many cases have an agenda to invest in women entrepreneurs. They are profit-driven investors who are also successful in investing in companies that women own and operate.

– The increase in the number of women on company boards is also slow. There are too few changes in board composition. Moreover, there is still a clear gender divide between different types of managerial positions. And often the categories of managerial positions that men often hold are considered more meritorious than the managerial positions that women hold in order to advance to higher management roles as well as how their previous merits are assessed in entrepreneurial roles. One bright spot is the emergence of new players in the market, entrepreneurial companies that offer their services to help recruit the right skills while more effectively achieving gender equality in managerial positions and on company boards.

What needs to be done to make entrepreneurship more gender equal?

– It is remarkable that Sweden, which ranks so highly on many gender equality indices, also has one of the lowest rates of wmoen’s entrepreneurship in Europe. At the same time, it is well known that an important basis for getting a good business idea off the ground is funding. Thus, funding that is available on equal terms for entrepreneurial women and men is important. Much needs to be done to ensure that public support, venture capital and bank financing are made available to entrepreneurial women and men on equal terms.

– For example, public funding may need to be redirected to women entrepreneurs in female-dominated sectors as it is a fact that among the ten most male-dominated occupations, women make up around one percent. It therefore seems unreasonable that taxpayers’ money in the form of extensive business support is continuously focused on such male-dominated industries. Public support measures aimed at strengthening the self-sufficiency of entrepreneurs should not reinforce economic inequality.

Contact malin.malmstrom@ltu.se

Read also:
Expert panel | Women’s entrepreneurship – Magdalena Markowska
Expert panel | Women’s entrepreneurship – Carin Holmquist
Expert panel | Women’s entrepreneurship – Lucia Naldi
2023 Expert Panel: “The state of play on gender equality in entrepreneurship”
DEBATE: Entrepreneurship – the forgotten issue of gender equality
NEW RESEARCH | 4 strategies women use to deal with inequality
NEW RESEARCH | Women run rural businesses for life balance
BOOK TIPS | Policies for women’s entrepreneurship
BOOK TIP | Entrepreneurial women create great value for themselves and others