Women entrepreneurs launch high-technology firms with less financial
capital than men, and continue to follow a different financial strategy
over time. Women's reliance on internal funding sources makes
a difference: Years after startup, women-owned high-tech firms continue
to lag behind men-owned firms in numerous performance measures,
including revenues, profits, assets and employment. This paper was compiled using data from the Kauffman Firm Survey (KFS), and authored by Alicia Robb of the Kauffman Foundation and Susan Coleman of the University of Hartford.
- Women-owned high-tech firms were more likely to be organized as sole proprietorships or partnerships than as corporations or limited
liability corporations. They also were more likely to be home-based
businesses and less likely to have employees. This suggests that, even
at startup, men anticipated developing larger and more complex firms
that same period of time, the women-owned high-tech firms continued to
lag behind the men-owned firms in critical performance measures. For
example, on average, women-owned firms had four employees in their
fourth year of operation compared with nearly seven employees at
- From startup through the fourth year of operation,
the women-owned high-tech firms did make progress in raising
substantial amounts of capital and in developing intellectual property.
- The women entrepreneurs remained unwilling or
unable to develop external sources of equity capital over their first
four years of operation, which could fund further innovations,
employment or growth.
- Women in high-tech firms invested
substantially higher levels of financial capital in their businesses
than women not in high-tech industries, at startup and over time.