Rachel Helm: Supporting local women entrepreneurs is good for our county
Most readers know that The Union’s current Editorial Board represents a very broad political spectrum.
Certainly, I and my colleague Reinette Senum exemplify that breadth. I think it’s pretty fair to say I’m the most conservative woman on the board and Reinette is definitely one of the more liberal progressive members. Yet, as diverse as our political philosophies may be, we both share an absolute conviction that encouraging and financially investing in grassroots small businesses in our local community is vital to the economic health and prosperity of Nevada County.
We also believe that encouragement and investment must include a focus on local woman business entrepreneurs. Reinette comes to her convictions through working as a grassroots business entrepreneur. My convictions come from spending my professional life in corporate America.
Our belief in the importance of focusing on small businesses is pretty understandable. Nevada County is rural and most of the businesses that service it are small. Small business are not only the backbone of Nevada County’s economy but also of the entire U.S. According to data from the U.S. Census Bureau, employer firms with fewer than 500 workers accounted for 48.5 percent of private sector payrolls in 2011, and according to the US Small Business Administration (www.sba.gov), small businesses produced 46 percent of private nonfarm GDP in 2008; and since the end of the recession, small firms accounted for 60 percent of net new jobs.
Why our advocacy for women business entrepreneurs? Given women now receive more than 50 percent of college degrees and it’s been estimated that women are responsible for at least 50 percent of consumer spending choices; women should also be driving a good percentage of new business opportunities. With that in mind, I’ve been digging into how women are faring as small business entrepreneurs on the national level, particularly in regards to securing early investment capital.
Woman-owned firms are currently the fastest growing business segment and now account for nearly 30 percent of all businesses in America. Yet woman-owned businesses account for only 16 percent of all conventional small loans and only 7 percent of them receive their seed money from private equity firms. So, even though women are driving a great deal of new business ventures, their access to startup capital is much lower than one would expect. This may in part be due to a lack of awareness by these entrepreneurs about potential sources of investment and how to go about securing capital.
There are now educational resources available on how to go about getting start-up financing by the SBA office listed above. There are also consulting firms that focus on small business entrepreneurs. One of those consulting firms is Creative Age Leadership based here in Grass Valley. A key charter of the firm is to guide entrepreneurs through the process of securing seed money. I met with one of the firm’s founders, Heather Furby, over lunch and one of the topics we discussed was how hard it is for women to get venture capital funding. We agreed this was in part because very few venture capitalists (VCs) are women. Women often create businesses around women-focused products and services. If women are not well represented in a VC’s business assessment process, the true market potential for the new business opportunity may be missed in their assessment. Sadly, until we see more women working in the VC community, this is unlikely to change.
Fortunately, there’s now a new source for seed capital. It’s known as crowd sourcing. With this model, many individuals can each invest a small amount in a new business through social networks on the Internet. This new kind of investment opens up a tremendous opportunity for up-and-coming entrepreneurs.
This gets me back to Reinette, who has been leading an effort to build sufficient financial support for the establishment of a new cheese-making business in Nevada City called Wheyward Girl Creamery. That effort has been very successful and Wheyward Girl Creamery is now on its way. New owners Barbara Jenness and Roberta DesBouillons couldn’t have done it so quickly without Reinette’s drive and passion to get them the investor support they needed. So congratulations to Barbara and Roberta, and kudos to Reinette for her entrepreneurial leadership.
I guess Reinette and I now have at least two things we agree on: our conviction that small business entrepreneurs are a keystone to our local economy and a love for good local cheese.
Rachel Helm, who lives in South County, is a member of The Union Editorial Board. Her opinion is her own and does not reflect the viewpoint of The Union or its editorial board. Contact her via EditBoard@TheUnion.com.
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