A by-the-numbers look at the best U.S. cities for female entrepreneurs to get started—and thrive in business.
While women make up 50% of the U.S. adult population and account for 46% of the workforce, when it comes to entrepreneurism, they’re behind the curve. All told, women account for only 35% of all people who get involved in starting a business.
According to a new survey by the Kauffman Foundation on the Entrepreneurship Gender Gap, women trail men not just in share of entrepreneurial activity but in revenues (just 1.8% of female-led firms have revenues of over $1 million vs. 6.3% of male-led firms), patents (5.65% of female firms seek patent approval versus 13% of men) and job creation (36% of women-led firms create jobs to 44% of male-led firms).
It’s not all bad. “The great news is that we’re absolutely seeing the number of female entrepreneurs skyrocket in the last year,” says Leesa Mitchell, author of the Kauffman study, Overcoming The Gender Gap: Women Entrepreneurs As Economic Drivers. As an indicator she references female applicants to Astia, a community of entrepreneurs committed to the development of high-growth women-led firms: “In 2010 there were roughly 100 applicants. This year it was well over 400. The momentum is there—it’s happening, and I think it’s going to mean some significant change on the playing field.”
It is against this backdrop that we present the ForbesWoman first annual list of the top 20 cities for women in business. Where are women best-poised for success and why?
To create our list, we began with the FORBES Best Places For Business and Careers, as ranked by my colleague Kurt Badenhausen, for a pool of cities with high projected job growth, education levels and quality of life, and low cost of business. Then to tighten the scope for female entrepreneurs, we added new metrics: What cities have seen the biggest growth in the number of female-led firms in recent years? Where are the most SBA-backed loans going to women, and where are women turning those loans into million-dollar profits?
With the numbers crunched, it wasn’t surprising to see who came out on top. New York and San Francisco–the Alley and the Valley–are the cities where not only are more women launching businesses, but thanks to SBA-backed loans, they have an easier time finding funding and resources which they are quicker to parlay into big-time profits.
“Both cities have strong ties to Web 2.0 activity and social media,” points out Mitchell. “But they’re also among our most diverse cities. In cities where diversity is the norm, we’re seeing women stepping up more readily and far more readily embraced by the community.”
Rachel Balik, a communications writer at Achievers, a San Francisco-based employee rewards company which saw $24.5 million in Series-C funding this week attributes the boom to the unique communal energy of the startup community in Silicon Valley: “Despite being the tech capital of the world, it still has a leftover Hippie vibe, where everyone genuinely wants to support each other. For women, there’s none of that breaking the glass ceiling or trying to get into the old boys club. The playing field is level.”
But just a few steps down the list, real surprises emerge. Tampa, Fla., is known as a city of retirees and not entrepreneurism. But according to research by WomenAble and American Express OPEN, Florida brags the second fastest-growing state in terms of the number of new firms opened between 1997 and 2011. Women-led firms in the city received over $19 million in SBA-guaranteed loans in 2010. On the ground, a keyed in observer of the startup scene in Tampa, Liz Bollinger, the co-founder of Biz-E Chicks, a networking and development community for local women building startups, has seen her own explosive growth. Since 2006 the group’s mailing list has grown from 10 subscribers to well over 500 women entrepreneurs, most entrenched in creative services like copywriting, marketing and photography.
Bethesda, Md., and Washington D.C. both benefit from government contracts in the area, and women’s earnings there are among the highest in the country, so their place among the top cities seems well-deserved. Then there’s dark horse Columbus, Ohio. In 2008, FORBES named it the No. 1 pick for up-and-coming tech cities, largely due to the Battelle Memorial Institute, a research center that supports multiple federal agencies including the Department of Energy.
Not surprisingly, in recent years, women-led firms are taking root there as well. Tech Columbus, a members-only resource for tech entrepreneurs in the Columbus metro area has seen an uptick in women-led ventures and has instituted a new series for women in technology. “In fact, we just funded this past spring our first business that was 50% founded and run by a female,” says Senior Director of Fund Management Allison Finkelstein. ” This business has now gone on to receive Series A funding and, in fact, just came back from California where it was the first Ohio company to ever present at Demo Day.” she notes that the number of female investors in Columbus is also on the rise.
But as a Midwestern city, Columbus is in the minority among the top cities on this year’s list. Anna Harvey, the assistant administrator of Women’s Business Ownership for the Small Business Administration and head of the 110 Women’s Business Centers (WBCs) across the country, attributes the lack of small business activity among women in the region to a lack of resources. According to American Express OPEN, Iowa and Indiana are at the bottom of the list of growth.
“I see an anecdotal correlation between the number of women in political positions, or positions of power in those communities, with the number of women launching small businesses,” says Harvey. While there isn’t hard data to support this theory, Mitchell agrees that it’s valid. “Look at the diversity on the Chamber of Commerce for a city,” she says, “and it will be indicative of the make-up of the startup community.”
But beyond diversity and in some cases, a deeply-rooted traditions in business, what makes one region more friendly to women in business than others? Julie Weeks, president and CEO at WomenAble, the consultancy responsible for the number crunching behind this year’s American Express Open report, points to a few factors that can set cities apart for women in business—above and beyond a city that’s just good for business, period: The legal environment, government procurement goals for women- or minority-owned firms, the existence of women’s business organizations in a community and enabling resources like SBA WBCs.
“The most successful business owner is one who is plugged into her community through organizations. Cities that have a lot of those opportunities,” says Weeks, pointing to the NAWBO and Women’s President Organization as examples of a must-join organizations, “are going to be the cities with people and businesses that rise to the top.”
It’s not all bad. “The great news is that we’re absolutely seeing the number of female entrepreneurs skyrocket in the last year,” says Leesa Mitchell, author of the Kauffman study, Overcoming The Gender Gap: Women Entrepreneurs As Economic Drivers. As an indicator she references female applicants to Astia, a community of entrepreneurs committed to the development of high-growth women-led firms: “In 2010 there were roughly 100 applicants. This year it was well over 400. The momentum is there—it’s happening, and I think it’s going to mean some significant change on the playing field.”
It is against this backdrop that we present the ForbesWoman first annual list of the top 20 cities for women in business. Where are women best-poised for success and why?
To create our list, we began with the FORBES Best Places For Business and Careers, as ranked by my colleague Kurt Badenhausen, for a pool of cities with high projected job growth, education levels and quality of life, and low cost of business. Then to tighten the scope for female entrepreneurs, we added new metrics: What cities have seen the biggest growth in the number of female-led firms in recent years? Where are the most SBA-backed loans going to women, and where are women turning those loans into million-dollar profits?
With the numbers crunched, it wasn’t surprising to see who came out on top. New York and San Francisco–the Alley and the Valley–are the cities where not only are more women launching businesses, but thanks to SBA-backed loans, they have an easier time finding funding and resources which they are quicker to parlay into big-time profits.
“Both cities have strong ties to Web 2.0 activity and social media,” points out Mitchell. “But they’re also among our most diverse cities. In cities where diversity is the norm, we’re seeing women stepping up more readily and far more readily embraced by the community.”
Rachel Balik, a communications writer at Achievers, a San Francisco-based employee rewards company which saw $24.5 million in Series-C funding this week attributes the boom to the unique communal energy of the startup community in Silicon Valley: “Despite being the tech capital of the world, it still has a leftover Hippie vibe, where everyone genuinely wants to support each other. For women, there’s none of that breaking the glass ceiling or trying to get into the old boys club. The playing field is level.”
But just a few steps down the list, real surprises emerge. Tampa, Fla., is known as a city of retirees and not entrepreneurism. But according to research by WomenAble and American Express OPEN, Florida brags the second fastest-growing state in terms of the number of new firms opened between 1997 and 2011. Women-led firms in the city received over $19 million in SBA-guaranteed loans in 2010. On the ground, a keyed in observer of the startup scene in Tampa, Liz Bollinger, the co-founder of Biz-E Chicks, a networking and development community for local women building startups, has seen her own explosive growth. Since 2006 the group’s mailing list has grown from 10 subscribers to well over 500 women entrepreneurs, most entrenched in creative services like copywriting, marketing and photography.
Bethesda, Md., and Washington D.C. both benefit from government contracts in the area, and women’s earnings there are among the highest in the country, so their place among the top cities seems well-deserved. Then there’s dark horse Columbus, Ohio. In 2008, FORBES named it the No. 1 pick for up-and-coming tech cities, largely due to the Battelle Memorial Institute, a research center that supports multiple federal agencies including the Department of Energy.
Not surprisingly, in recent years, women-led firms are taking root there as well. Tech Columbus, a members-only resource for tech entrepreneurs in the Columbus metro area has seen an uptick in women-led ventures and has instituted a new series for women in technology. “In fact, we just funded this past spring our first business that was 50% founded and run by a female,” says Senior Director of Fund Management Allison Finkelstein. ” This business has now gone on to receive Series A funding and, in fact, just came back from California where it was the first Ohio company to ever present at Demo Day.” she notes that the number of female investors in Columbus is also on the rise.
But as a Midwestern city, Columbus is in the minority among the top cities on this year’s list. Anna Harvey, the assistant administrator of Women’s Business Ownership for the Small Business Administration and head of the 110 Women’s Business Centers (WBCs) across the country, attributes the lack of small business activity among women in the region to a lack of resources. According to American Express OPEN, Iowa and Indiana are at the bottom of the list of growth.
“I see an anecdotal correlation between the number of women in political positions, or positions of power in those communities, with the number of women launching small businesses,” says Harvey. While there isn’t hard data to support this theory, Mitchell agrees that it’s valid. “Look at the diversity on the Chamber of Commerce for a city,” she says, “and it will be indicative of the make-up of the startup community.”
But beyond diversity and in some cases, a deeply-rooted traditions in business, what makes one region more friendly to women in business than others? Julie Weeks, president and CEO at WomenAble, the consultancy responsible for the number crunching behind this year’s American Express Open report, points to a few factors that can set cities apart for women in business—above and beyond a city that’s just good for business, period: The legal environment, government procurement goals for women- or minority-owned firms, the existence of women’s business organizations in a community and enabling resources like SBA WBCs.
“The most successful business owner is one who is plugged into her community through organizations. Cities that have a lot of those opportunities,” says Weeks, pointing to the NAWBO and Women’s President Organization as examples of a must-join organizations, “are going to be the cities with people and businesses that rise to the top.”
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