Elite women-owned business — those earning $10 million in revenue annually — are growing in numbers almost 50% faster than $10 million business in general and nearly 100% faster than all women-owned businesses, according to Growing Under the Radar: An Exploration of the achievement of Million-Dollar women-Owned Firms, research commissioned by American Express OPEN.
What do these women entrepreneurs know that others don’t? Based on my observations and knowledge of the market, six factors separate the cream from the milk.
1.) Participate in peer advisory groups: “Entrepreneurs learn best from one another rather than academic courses,” said Marsha Firestone, President and Founder of Women Presidents’ Organization (WPO), a peer advisory group for women presidents of multimillion-dollar companies.
During the course of 15 years, WPO has grown to 105 chapters on five continents with more than 1,600 members. For women whose companies have reached the $10 million and $50 million marks, WPO offers separate periodic meetings.
Also known as “mastermind” and “CEO” roundtables, peer advisory groups bring the heads of companies together to problem-solve and brainstorm their day-to-day challenges and opportunities under the guidance of a trained facilitator. Why participate in one of these groups? Simple. Companies that participate in peer advisory groups perform better: 6% increase in revenue annually compared to a 9% decrease for businesses in general from 2005 – 2009, according to research conducted by Vistage, another organization that offers peer advisory groups. Vistage has seen its female CEO members rise by 25% since 2007.
2.) Use emotional intelligence (EI): “Women have a different type of EI than men,” said Norma Rosenberg, a Vistage Chair in NYC. Women’s ability to sense, in the moment, how others are reacting makes them great leaders. They tend to nurture and support staff. However, the most effective women entrepreneurs balance this ability with systems thinking, which is often associated more with men. You need to be analytical to grow a business. You also need the confidence that you can do it, which is another characteristic associated more with men than women.
3.) Seek outside funding: Women may under-nourish their businesses by not seeking outside financing. However, there are now more opportunities for funding from new and existing angel groups dedicated to funding women-led companies, such as Astia Angel, a new angel network and Golden Seeds, the fourth largest angel network in the US and the third most active in terms of deals done in 2011. Add in the potential game-changing impact that crowdfunding offers for women entrepreneurs and we should see more women entrepreneurs going for and receiving funding.
4.) Participate in training and formal networks for high growth women-led companies: During the past decade or so, organizations such as Astia and Springboard Enterprises have provided leadership training, access to capital, and connections to accelerate the growth of women-led companies. Astia companies have a 60% plus fundraising success rate within one year of joining and raised $1 billion. Springboard companies have an 83% fundraising success rate and raised $5.6 billion. A recent entry into the training market is Double Digit Academy, which a one day intensive to help women shine when presenting to VCs.
5.) Make strategic use of mentors, advisors, and connections: Relationships can get you access to the money, customers, and talent you need to grow your business. Not all networks are equal. Skip the book club and go where power brokers hang out. “Connect with fellow speakers at conferences,” says Liz Elting, co-CEO of TransPerfect, which provides translation and discovery services to law firms, healthcare, and other types of companies. She also makes connections via her clients and through charity events.
Both Elting and Cristina Mariani-May, of Banfi Vintners, a family winery, make use of their college alumni networks. Mariani-May also has a board of advisors to provide objective advice and insights about the marketplace.
6.) Increase visibility: Successful women entrepreneurs participate in competitions that showcase their skills. Three that honor high growth are Ernst & Young Entrepreneur of the Year Award, Inc. 500/5000 List and WPO’s 50 Fastest Growing Women-Owned/Led Businesses. Elting has been on all three of the lists.
“Getting media visibility [for women entrepreneurs] is still a struggle,” said Firestone. It’s better than what it was, but improvement is still needed, she added. Reporters tend to focus on a few stars, such Sara Blakely of Spanx. She has a great story, but other women entrepreneurs do, too. One of the reasons I created Breaking Barriers, my blog on Forbes, is to give successful women entrepreneurs the visibility they deserve. The other is provide the inspiration for the next generation of women entrepreneurs.
Which strategies of successful women entrepreneurs will you use to catapult your company into the big leagues?
Photo: Julia Landauer only has one speed — fast. She is a race car driver, Stanford University Student earning a degree in science, technology and society, New Yorker, businesswoman and Survivor cast member.