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Written by Frank Lopez
Startups are booming in the United States and around the world, and women entrepreneurs are leading the surge.
According to the World Economic Forum’s 2022 study, 49% of women started new businesses in the U.S. in 2021, up from 28% in 2019.
By the end of 2022, up to $1.9 trillion worth of revenue will be generated by women-owned businesses, including 42% of small businesses owned by women.
In 2023, women in the United States will start more than 1,200 new businesses every day.
Despite the immense value, perspective, and innovation that women entrepreneurs bring to the global business fabric, they have historically faced higher barriers to overcome than their male counterparts.
Some of the big challenges women entrepreneurs face are establishing a strong first impression, balancing personal and professional life, and perhaps most importantly, accessing funding from lenders, grants, and governments. It’s possible.
Fortunately for local women entrepreneurs, there are a variety of funding opportunities available from business associations, financial institutions, and state and federal grants.
There are also federal resources, such as the Small Business Administration’s (SBA) Women’s Business Ownership Office (OWBO), to help women start businesses through programs coordinated by regional offices, including business training, counseling, federal contracts, and access to credit and funding. Supporting the house.
The SBA also administers an 8(a) business development program to help disadvantaged small businesses compete in the marketplace.
In the Central Valley, business organizations such as the Fresno Area Hispanic Foundation (FAHF) have special programs to support women entrepreneurs.
FAFH runs Latinapreneur (Spanish) and Womanpreneur (English) programs that focus on helping minority women business owners build marketing, financial health, and other business fundamentals.
FAHF offers Community Development Financial Institution (CDFI) loans. This is a loan with fair terms that focuses on community development.
FAHF Chief Operating Officer Yerry Olivares said, “It is difficult for women entrepreneurs to go directly to banks to obtain loans to start or grow their businesses.”
Olivares pointed to common reasons why some women have trouble getting loans, including the importance banks place on credit ratings. Another factor is that you need collateral when taking out a loan, and many women don’t have collateral.
Many small business owners also prefer loans around $500,000, so they are looking for small loans in the $5,000 to $10,000 to $25,000 range, which many banks will pass through.
In addition to being available to women business owners, FAHF also has available consumer loans designed to meet a variety of financial needs, including refinancing, covering unexpected expenses, and even financing a car purchase. I am.
Mr. Olivarez said many of his clients lack higher education and may not be familiar with starting or building credit, and one of the foundation’s goals is to make clients aware of the importance of established credit. The goal is to provide the tools and resources to help people do what they do best.
“Women are the CEOs of households, and as women we need to understand the needs of women entrepreneurs and promote products that support women entrepreneurs,” Olivares said.
Access to capital is a major advantage for local entrepreneurs, but access to resources and assistance with financing can be just as important.
At the Vision View Business Formation Center, Fresno’s business hub and incubator, local businesses start and expand with support such as space leases, business development services, and startup resources.
Linisha Senegal, founder and executive director of Vision View, a businesswoman herself, says many women can face difficulty attracting investment in the male-dominated corporate world. Stated.
The major hurdles for women in obtaining funds from financial institutions are the legal structure and creditworthiness of the United States.
“Many ethnic minority businesses do not meet the credit score criteria to be eligible for funding,” Senegal said.
Senegal said it applied for state funding just this year, but this was the first year it was asked to submit a credit score. Typically, credit scores are not required for grant applications, as is common with bank loans.
She said many minority business owners and women business owners don’t have the necessary lender or bank relationships, and many grant programs require up-front or matching funds, which many minority business owners don’t have. He said he doesn’t have one.
By partnering with local organizations such as Access Plus Capital, which provides microloans to businesses, Senegal can help businesses get everything they need to launch and even expand, rather than being locked into predatory lending. He said that there is a possibility that this could be achieved.
She said many women, especially black women, are leaving the corporate world and starting their own businesses at a faster pace. She expects that to continue.
Senegal has some advice for women considering applying for a business loan.
“Go out and market your services to friends and family and see if they believe in your vision. If you can sell to 10 friends and family, it’s worth taking to the next level. I think there is,” Senegal said.
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