Did you know that businesses founded by women show significantly better financial returns – more than twice as much per dollar invested – than those that are male-led?
Research from the Boston Consulting Group found that over a five-year period, companies that had a woman founder or co-founder earned 10% more cumulative revenue than their male counterparts.
Yet, only 34% of businesses in Australia are owned and operated by women. In the twenty-year period between 1994 and 2014, the number of female-led businesses increased by only 3%.
Now, I’m sure you are all wondering why this is the case?
The short answer is…”The Confidence Gap.”
The Confidence Gap
To elaborate, the Confidence Gap is the difference in how men and women perceive their own abilities.
And it poses one of the biggest obstacles that budding fempreneurs must overcome.
A 2019 study conducted by the Wade Institute of Entrepreneurship found that not only were women less confident in their own enterprising abilities, they were also less optimistic and experienced higher levels of fear in regards to failure.
Do men doubt themselves? Of course. But they don’t let their doubts stop them as often as women do.Victoria Brescoll
While men also sometimes experience a lack of confidence in their abilities, it is far less often.
Whereas women with the same skills, experience, and knowledge often have far less confidence and believe that they would be unable to succeed or compete.
Unsurprisingly, even women who are engaged in entrepreneurial activities failed to self-identify as entrepreneurs.
There are a couple of reasons behind this.
Firstly, pop culture and the media play a significant role in how we as a society frame, represent, and reference different concepts.The most prevalent idea of an entrepreneur, which is disseminated in our society, is that of the innovative, risk-taking, confidant…MAN. Click To Tweet
The most prevalent idea of an entrepreneur, which is disseminated in our society, is that of the innovative, risk-taking, confident…MAN.
Men who are changing the face of science and technology. Men who are pioneers of finance.
You know the ones I’m talking about, you see them celebrated everywhere.
Whereas, women entrepreneurs are hardly recognized – let alone celebrated.
Secondly, women tend to be a bit more risk-averse, which usually means that they steer clear of those mainstream media-focused entrepreneurial activities – the big risk, big reward kind of activities.
Instead, women focus on smaller enterprises such as health and retail. Leaving the more stereotypical entrepreneurial roles to the men.
Because of this extreme aversion to risk, female-led start-ups find themselves launching businesses with a lot less capital. Choosing to forgo banks and VCs, and instead relying on friends, family, and their savings when it comes to start-up capital.
And this is all because women lack the self-assurance that men do.
Since confidence is as important as competence, female business owners miss out on bigger investment opportunities because they believe that their ventures would not be seen as successful in the eyes of a bank or a VC firm.Female business owners miss out on bigger investment opportunities because they believe that their ventures would not be seen as successful in the eyes of a bank or a VC firm. Click To Tweet
All this does is hinder a woman entrepreneur’s ability to scale their businesses as quickly and successfully as men who on average are working with three times the amount of capital.
The Wade Institute also found that a lack of visibility with existing female entrepreneurs has only exacerbated the Confidence Gap.
As there aren’t as many women entrepreneurs, women are less likely to know a fempreneur and as a result, they are less likely to become one themselves.
How Can You Reduce this Gap?
1. Know Your Strengths
Studies show that a high level of self-awareness is positively correlated to the overall success of an organization.
As humans we tend to focus more on the negatives than we do the positives. But it’s time to accept the fact that we all have flaws and weaknesses. So, instead of trying to fix all your flaws and be perfect, focus on what you are already good at.
Being self-aware about your capabilities and weaknesses will not only allow you to play to your strengths and grow your business. It will also allow you to plan and work around those areas that you may not necessarily excel at.
2. Don’t let Fear Rule You! Learn from Your Mistakes
Everyone makes mistakes; it’s all a part of life.
Would you stop your child from learning to ride a bike because of the possibility that they may fall?
So why do you let the fear of making a mistake stop you from taking the next step?
Look at mistakes as building blocks, accept the fact that you will make a few of them. And instead of wallowing in self-pity and doubt, learn and grow from them.
3. Take Small Steps Instead of Huge Leaps
Not every decision you make has to be a make-it or break-it kind of situation.
If you don’t have the confidence to make a huge life-changing decision, make small ones instead.
It could be as small as choosing a font for a website, or maybe a colour palette for your business. You could go even smaller and choose a plant for your office.
Each small decision will bolster your self-confidence, and soon you’ll be making those life-altering decisions without breaking a sweat!
4. Positive Affirmations + Visualize Success
Mind over matter.
I’m sure you’ve heard the saying one or a hundred times before. But it’s true, our minds are incredible and we are the narrators of our own realities (to a certain point).
Positive affirmations help change your mindset, it allows you to focus on the good things in your life and gives you the self-belief that you truly are in charge of your life.
Try telling yourself that you can do this (whatever it is) and see how it changes the task at hand. No longer is it an obstacle but a challenge that you will crush because you are strong and capable.
Confidence is Not a Destination…
How many times have you thought the success of your business is because you were lucky?
That you were just at the right place at the right time?…
Or maybe, just like Facebook COO Sheryl Sandberg, you wake up feeling like an imposter…a fraud.
Sometimes, finding the confidence and courage to trust yourself can seem like the hardest thing to do. But just remember that everyone doubts their choices and themselves at times.
And as Barbara Streisand said, Doubt can motivate you, so don’t be afraid of it.
Have you experienced the Confidence Gap, or are you struggling with a lack of self-belief? Let us know in the comments below xx
Sometimes it’s difficult to build confidence on your own and you feel like you need the reassurance of having someone in your corner to guide you, hold you accountable and celebrate your wins. And for many savvy women, that support system comes in the form of coaching.
Naomi D’Roza is a PR intern at Fempire. With a penchant for writing, Naomi wants to create content that inspires and empowers women to live their best lives.