U Research Shows that Women Entrepreneurs Face Start-Up Obstacles


Kiffer Creveling

The Spencer Fox Eccles Business Building, one of the David Eccles School of Business buildings at the U. Chronicle archives.

By Connor Applegate


Young entrepreneurs already face a number of obstacles with launching a new business, and recent University of Utah research shows that this hurdle is significantly more difficult for female entrepreneurs and indicates that they are less likely to be able to secure startup funding than their male counterparts.

Lyda Bigelow is an associate professor in the Department of Entrepreneurship and Strategy at the David Eccles School of Business and received her MBA from Wharton and Ph.D. from the University of California, Berkeley. Bigelow’s prior experience in the corporate world now translates into her academic research on business strategy. Her latest research study involved having both men and women participants seek an Initial Public Offer (IPO), which is when a company offers their shares to the public for the first time. The approval of an IPO is essential if any company hopes to be seen by the general public.

The research included potential investors (the study participants) reviewing the fake IPO candidates. “These applicants came from various business backgrounds, education levels (undergraduate, graduate) as well as being split between men and women,” Bigelow said. Despite the equal distribution of experience and skill-sets, women CEOs were turned down at a higher rate, and study participants were four times as likely to recommend an investment in a company with a male CEO.

Associate Professor Lyda Bigelow (Courtesy of Lyda Bigelow)

A 2018 article in Fortune found that female entrepreneurs only received 2 percent of all venture capital dollars in 2017. That number only slightly increased to 2.2 percent in 2018.

There are a number of additional theories as to why women struggle to find initial funding. These proposed theories include everything from differences in risk analysis to the bureaucratic restrictions of the pitching process. A recent article in Utah Business suggests one problem is that the majority of venture capitalists who would be funding startups are reluctant to invest in first-time entrepreneurs, which the majority of female entrepreneurs are. It is a difficult dynamic to solve. Ultimately, the only method of change is for more men to invest in female-led startups. As more of these companies begin to prosper, more women will achieve further influence in capital decision-making. The article goes on to state that “successful entrepreneurs often go on to invest in new companies and bring more women into the investment space.”

Despite the research findings, Bigelow remains optimistic about the level of interest and enthusiasm this issue attracts. “I have equal amounts of women and men working with me on this research,” she said. “It says a great deal about the University of Utah. There are clear business and societal benefits to welcoming diversity.”

Improved access for half of Utah’s population will play a major role in boosting the state economy. At last week’s Small Business Summit, keynote speaker Sarah Calhoun, whose company Red Ants Pants produces work pants made specifically for women, showed just one example of how centering business strategies towards including women in marketing and on an administrative level should be of interest towards future business developments.

When asked about the impact she hopes her findings might create, Bigelow recommends to “not feel distraught” and “be aware of the data to work against any implicit biases you might face.” Bigelow said that the solution is to embrace diversity in business. “Normalizing a modern workforce produces better opportunities for startup companies when it matters the most: at the start.”

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