Since New Yorkers first celebrated International Women’s Day in 1909, American women have made great strides toward equality in the workplace, politics and at home. Long gone are the days when women couldn’t vote or sex discrimination was blatant and legal.
But a quick glance at the gender composition of society’s most influential leaders suggests that there is still a lot of work to do. For instance, women still comprise only 19.4 percent of the US congress and just 4.8 percent of chief executives in the Standard & Poor’s 500 [as of 2015] .
Another equally important, though less often cited, disparity is the fact that women are much less likely to lead new business enterprises. On average, men are nearly twice as likely as women to launch a new business. And women are primary owners of only about 28 percent of private firms.
Why are there so few women entrepreneurs? Differences among the genders in terms of work experience, resources and social ties are a few of the usual suspects. But I’ve discovered evidence that unconscious cognitive biases likely also play an important role. I find that women entrepreneurs are at a disadvantage because people are prone to doubt that they possess the kinds of traits and skills that we stereotypically associate with entrepreneurship.
On an aggregate level, this dynamic suggests countless ideas that could have blossomed into successful businesses and benefited the economy never did, simply because the individuals who pitched them weren’t the “right” gender.
Deep-rooted biases like these are very hard to combat and can’t be eliminated with the passage of a law. Rather, it will require a broader cultural shift in how we view entrepreneurs.
Gender Stereotypes, Entrepreneurship and Innovation
To gain insight into the role that unconscious bias plays in early-stage entrepreneurship, I conducted a series of experiments in the US and UK. Participants were asked to evaluate a mixture of mundane and innovative entrepreneurial pitches. Some were told that women led the ventures, and others that men were in charge. They then scored each business on a series of measures designed to capture the extent to which they thought it would be viable and worthy of investment. They rated each entrepreneur on a series of dimensions, such as how competent and skilled they seemed and their perceived level of commitment.
I found that participants, when considering pitches of run-of-the-mill business ideas, rated women-led ones as generally less viable and less investment-worthy than those described as spearheaded by men. And, even though there were roughly equivalent numbers of male and female participants, I didn’t find any evidence of gender differences: women rated women just as poorly as the men did. (The participants were also mostly in their early 20s, a sign that this form of gender bias is not a bastion of older generations.)
My analysis further indicated that respondents penalized women entrepreneurs because they systematically perceived them to be less competent and/or skilled than their male counterparts, not because they thought they were any less committed to their venture or any less likable.
The results shifted, however, when the idea that the entrepreneur was pitching was particularly novel, such as one based on a brand new product or service. In this scenario, participants consistently perceived women entrepreneurs to be more competent and skilled – and their businesses more worthy of support – than their less innovative female counterparts. By contrast, ratings of male-led ventures did not change depending on the degree of innovation, and instead were more based on participants’ willingness to tolerate risk.
This finding suggests that when a man proposes a business idea, he can typically expect others to respond on the basis of a simple risk-benefit calculation, the kind any venture capitalist might make when deciding whether to help finance a project. But when a woman proposes the same idea, she can expect others to simultaneously be looking for cues that she in fact possesses the types of skills and traits needed to make a venture a success – abilities she’s often assumed to lack because of her gender.
Entrepreneurs as ‘Lone Warriors’
Indeed, our ideal cultural image of an entrepreneur is similar to that of a lone warrior, which is based on a set of stereotypically masculine traits like aggressiveness, independence, competitiveness and a willingness to take risks. When women propose an innovative idea, they show that they are willing to go out on a limb and, in doing so, signal possession of supposedly “entrepreneurial” traits. In this way, women have to work harder to prove to others that they have what it takes to run a successful start-up.
So what are the implications? For starters, this subtle tendency to discount a woman’s ability to take on an entrepreneurial role may, over the course of repeated encounters, discourage her from pursuing such a career in the first place. It may also disadvantage women entrepreneurs when they seek financial and social support.
In today’s economy, informal sources of support such as online crowdfunding and interpersonal connections play an increasingly important role in getting new ventures off the ground. If most people rely on cognitive shortcuts like the ones revealed in my research and subtly doubt a woman’s ability to be an entrepreneur, she’s less likely to get the funding necessary to pursue her idea.
How Can We Combat Bias?
On the bright side, my findings offer one “survival strategy” for women entrepreneurs: they may be able to mitigate the disadvantaging effects of gender bias by explicitly promoting the novelty of their venture. They may also be able to lessen disadvantage by highlighting the unique set of qualifications and experiences they bring to their project. This proactive step can help reduce any lingering uncertainties about a woman’s ability to run an enterprise.
Eliminating the need for women to have to compensate for stereotypical biases, however, will have to come from broader changes in our cultural image of entrepreneurship. In reality, entrepreneurs aren’t lone warriors. They’re taking very calculated risks and rely on an interconnected network of social and financial support (which is often less accessible to women). By leveraging this network when first pitching ideas, entrepreneurs can in fact buffer themselves from the greatest risks and help ensure that even failure could lead to eventual success.
Creating a less gendered vision of what successful entrepreneurship looks like will undoubtedly be challenging. But one way to start would be for investors, organizations and educators focused on entrepreneurship to actively promote and rely on criteria based on the content of a business plan, rather than the perceived personality traits of a given individual.
Doing so will bring us closer to the dream of gender equality in the workplace and will gradually increase women’s participation in entrepreneurship – one of modern society’s most valued leadership positions. We have a long way to go, but critically reflecting on our own unconscious, and typically unintentional, biases is a critical first step toward reaching that goal. Only then will International Women’s Day become a celebration of true equality.
Sarah Thebaud is an Assistant Professor of Sociology at the University of California, Santa Barbara.