SOW_ATTACHMENT_A_Accomplishments.pdf

Update from the National Women’s Business Council Prepared on December 7th. 2015

I. RESEARCH ACCOMPLISHMENTS

Completed

Q1, FY15

Q2, FY15

Q3, FY15

Infographic Toolkit on Women’s Access to Capital In an effort to simplify the capital challenge, the Council published an innovative infographic on accessing capital, featuring tips and best practices. The infographic is a guide to help women entrepreneurs navigate the various types of capital based on the business’ stage of development. It includes essential tips from the three successful women business owners interviewed for the project, provides examples of different financing situations that business owners might face, and explains different types of capital — such as crowdfunding, angel investing, and purchase order financing.

Women’s Business Centers Impact Study Women’s Business Centers (WBCs) are a national network of more than 100 organizations throughout the United States designed to assist women in starting and growing small businesses. According to the SBA, the intention is to “level the playing field” for women entrepreneurs who still face unique obstacles in the business world. The SBA’s Office of Women’s Business Ownership oversees the WBC network, which provides entrepreneurs, including women who are economically or socially disadvantaged, with a variety of comprehensive business training and counseling in over thirty languages. In collaboration with the SBA Office of Women’s Business Ownership, the Council worked with graduate students from Carnegie Mellon University to review and analyze the effectiveness of the WBC Program — important since the last impact study was performed in 2004. Our hope was to gain an understanding of the WBC network, what they need, and how to best support them. The research recommended that the SBA:

1. Standardize data collection procedures and provide clarification of data reporting definitions and statistics.

2. Revise the EDMIS data collection tool in order to better capture the full impact of WBCs.

3. Track additional performance and demographic metrics.

The findings informed the Council’s comment on the Advance Notice of Proposed Rulemaking on the WBC program and Congress’ (pending) legislation on the WBC program.

If passed as written this will reauthorize the WBC program with $21.75 million, increase grant levels available to eligible women’s business centers to $250,000, and streamline the paperwork required of the WBCs to encourage new programming.

Structural Differences in Women’s and Men’s Social Networks A social network is a group of individuals (such as family, friends, mentors, employees, coworkers, service providers and others) connected by interpersonal relationships.

Networking is the ability to leverage this network to access potential partners, new ideas, resources, support, and advice throughout the business life cycle. A robust and effective social network is essential for business success; an entrepreneur can leverage this network to respond effectively to challenges, seek out new opportunities and identify talent or pathways to capital. This project, conducted by Premier Qualitative Consulting, sought to develop a deeper understanding of what the fundamental differences are between the entrepreneurial networks of men and women. Per previous Council research, a disparity in the amount and source of financial capital between men and women entrepreneurs was clear. There was an emphasis on an entrepreneur’s ability to identify key members of their

Q3, FY15

Q4, FY15

network, but less discussion on the gender differences that exist in entrepreneurs’ social networks. The completed research confirms that social networks are essential to firm survival because they enable the movement of financial, human, and intellectual capital, as well as facilitate information exchange. However, the usage and efficacy of those networks vary depending on gender and are impacted by the quality and quantity of those involved.

Other findings include:

• Social capital is critical to entrepreneurial confidence and, ultimately, entrepreneurs’ abilities to achieve their desired business outcomes

• For both women-owned and men-owned businesses, support from effective or influential founding helpers has a positive effect on the owner’s ability to achieve their desired outcomes

• All entrepreneurs have a tendency to choose ongoing helpers similar to them. This isn’t always great as it is important that your business partner has access to assets and relationships you may not have access to

• The quality of one’s social network is more important than the quantity of the network

• Women entrepreneurs gain more value from ongoing relationships than men

Undercapitalization as Contributing Factor to Business Failure Undercapitalization is a term defining a business with insufficient funding, or capital, to support its operations. Undercapitalization is a problem for most businesses, but it disproportionately impacts women-led and women-owned enterprises because of access to capital challenges outlined by Council and other research. Undercapitalization limits enterprise growth by constraining business investments in key assets such as equipment, employees, or inventory necessary for growth; the business does not have the funds it needs to meet market demands. This research, conducted by Premier Qualitative Consulting, explores the role of undercapitalization on the survival of firms. This research is the third in a series that the Council commissioned on access to capital and high-growth, women-owned businesses. This study found undercapitalization continues to be a factor in firm survival, but also found other factors result in firm survival that potentially debunk previous findings. Specifically, previous industry experience — not startup experience — is strongly connected to firm survival. Other findings include:

• Team ownership leads to higher likelihood of firm survival, specifically that at least two owners are involved in the day-to-day operations of the business, confirming our previous research

• High-cost capital and poor credit history negatively impacts a firm’s longevity

• Women-owned and women-led businesses are more likely to be undercapitalized than their non-women-owned/led counterparts

• At start-up, women-owned, and women-led firms are more likely to face liquidity constraints, which have long-term implications

Shark Tank Analysis The popularity of ABC’s “Shark Tank” suggests broad interest in entrepreneurship. So how does this impact women entrepreneurs? To answer this question, the Council analyzed the role of gender in the hit television show, tracking the performance of women entrepreneurs and the sharks through season five, episode 10. The Council then created a set of infographics documenting the demographic breakdown of the entrepreneurs that

Coming Soon!

Expected

Q2, FY16

Coming Soon!

Q2, FY16

present their ideas on the show, how they do so, how often they make a deal and which one of the sharks is most likely to make that deal. Findings include:

• Women made up 153 of the total contestants, or 34.9%

• 62.7% of the women pitched as part of a team and 37.3% appeared alone

• The three most popular industries for women contestants were Food and Beverage

(20.9%); Fashion, Clothing and Accessories (20.3%); and Education, Child Development and Children’s Products (15.0%)

• Women contestants received offers from sharks at roughly the same rate as men — 58.8% versus 62.6%, respectively

• 49.7% of the women contestants made deals with sharks, exactly the same rate as men — likely because men were more likely than women to turn a deal down

• 48.0% of men made counter-offers, while only 34.4% of women did the same 98

Online Resource Platform for High-Growth Women Entrepreneurs After surveying the entrepreneurship ecosystem for high-growth women entrepreneurs, and conducting many conversations with our stakeholders, the Council identified a need to develop an entrepreneurship resource platform for growth-minded women entrepreneurs;

this platform will serve as a resource of valuable information and guidance for women entrepreneurs seeking to grow and scale their businesses. The Council commissioned Optimal Solutions Group, LLC for this project, and the research commenced in the summer of 2015. The researchers are in the process of aggregating and mapping the available resources, organized by the stages of the business cycle. The Council expects to launch the platform in spring 2016 as an easy-to-use platform functioning as a data repository for relevant tactical resources on how to ideate, launch, and grow a business.

Survey of Business Owners Part 2 The Council commissioned Womenable for further analysis of the final SBO data set, which is expected in late 2015. This project builds on the preliminary data the Council synthesized in summer 2015, and will explore, in detail, the growth and development of women-owned enterprises over the 2002 to 2012 period, paying particular attention to differences between the pre-recession period of 2002-2007 and then more recent 2007-2012 period.

Knowing where women-owned firms are growing at a faster-than-average pace and recovering from the effects of the recession, and where they are lagging, will provide critical information for policy and programmatic decision-making. Specifically, the study will examine:

• Changes in growth in the number, employment, payroll, and revenue of women-owned business nationally, by state, by top 50 metropolitan areas, and by industry, over the entire 10-year period and across each five-year period

• Changes in the relative size of women-owned businesses by employment and revenue size categories — nationally and by state, metropolitan area and industry

— to determine where growth is above and below average

• Comparative size gaps between women-owned firms and all other privately-held firms — by industry and along the business size continuum (revenue and employment) — and how those gaps have or have not changed over the past ten years, and especially since the recession.

In Progress.

Q2 FY16.

In Progress.

Q3 FY16.

Design Thinking Project on the Bank Loan Application Process The experiences that women entrepreneurs have during the bank lending process continue to be disparate from the experience men entrepreneurs have. The Council conducted research utilizing a design-thinking methodology to identify innovative solutions to the access to capital challenges previously explored in Council research. This project focused specifically on the bank loan application process, and explored in-depth the experiences of women as they pursued capital to buy, launch or grow their businesses. This research not only illuminates the disparities in the experience, but it also is intended to define the challenges and then identify and generate potential solutions and insights to increase the number of loans granted to women entrepreneurs.

Women’s Participation in Corporate Supplier Diversity Corporate supplier programs are a key pathway for women entrepreneurs to increase their sales significantly. Women entrepreneurs — or those exploring starting a business as their next step — may not have a strong understanding of the opportunities available in these programs. Moreover, research regarding women’s participation in corporate supplier diversity programs is virtually nonexistent. The goal of this project is to develop a body of knowledge on opportunities for women entrepreneurs in corporate supplier diversity programs. The researchers conducted over 800 surveys and completed eight focus group sessions; interviews with corporate supplier diversity and procurement officials are forthcoming.

Women’s Participation in Incubators and Accelerators Incubators and accelerators are an important support to new and growing businesses, and have been a focus of policymakers in recent years. As a result of this attention, the Council is conducting research on women founders and their experiences with these programs. The purpose of this study is to analyze how women entrepreneurs determine whether to utilize these resources, how firms are selected by incubators and accelerators, factors influencing the successful graduation of new women-owned businesses, and recommendations on how incubators and accelerators can improve their contributions to the growth of women-owned businesses. The researchers conducted the first phase data analysis and literature review, and completed in-depth interviews with experts in the accelerator field. They also launched three OMB-approved surveys to collect data on women entrepreneurs, women graduates of these programs, and program managers.

Studying Best Practices in Regional Ecosystems The Council learned from travels around the country meeting with women entrepreneurs that there are thriving, vibrant local ecosystems. The Council is examining these regional ecosystems to identify what is working well and to better understand how these ecosystems are meeting the needs of women entrepreneurs. Through this research, the Council will explore the conditions for their success and the opportunities for additional support. The Council will convene a series of town halls around the country to convene key stakeholders— entrepreneurs, government, business support and professional organizations, universities, investors, media, and others — to discuss the successes and challenges their community has faced in supporting high-growth women entrepreneurs.

From these conversations, researchers will develop a playbook of policies and recommendations to help the leaders and stakeholders of entrepreneurship ecosystems increase support for women entrepreneurs.

2. OTHER ACCOMPLISHMENTS

• The Council applauded the public-private partnership between the U.S. Census Bureau and the Marion Ewing Kauffman Foundation on the implementation of the Annual Survey of Entrepreneurs, as it will provide more timely and relevant data on business ownership and provide longitudinal analysis. The Council reviewed the approach and provided content and data recommendations. The Council Chair met with Secretary Pritzker to convey these recommendations directly.

• The Council, given early access to the Survey of Business Owners dataset, analyzed and synthesized the preliminary findings and published new fact sheets on Women-owned Businesses, Gender Differences in U.S. Businesses, Industry Differences by Gender, Veteran Women-owned Businesses, Asian-American Women-owned Businesses, Black Women-owned Businesses, Hispanic Women-owned Businesses, and White Women-owned Businesses. The numbers were shared on a well-attended call with press, also featuring Tina Tchen, Assistant to President Barack Obama, Chief of Staff to First Lady Michelle Obama, and Executive Director of the White House Council on Women and Girls.

• The Council continued to urge the Consumer Finance Protection Bureau to begin the collection of data on demand for credit.

• Through a public comment, a letter to Director Cordray, and meetings with the Bureau’s Community Affairs team, the Council clarified the purpose and need for implementation of Dodd-Frank’s Section 1071, and requested urgency in its compliance and release.

• The Council designed and developed a resource for journalists with the goal of increasing media coverage of women’s entrepreneurial endeavors and successes. This resource includes advice, insights, and suggestions for covering women’s entrepreneurship, and provides guidance for finding and interviewing women entrepreneurs.

• The Council held convenings to elevate the discussion of crowdfunding — as an opportunity for women to raise early capital, test new products, gauge demand and solicit feedback. The Council also called on the Securities and Exchange Commission to define equity crowdfunding, as it is an opportunity for both women entrepreneurs and women investors.

• The Council hosted a series of roundtables in partnership with the SBA Office of Investment and Innovation to discuss strategies to increase the pipeline of women into careers in finance, and the participation of women in the financial services industry, including early stage venture capital, growth capital, private equity and more traditional lending. At the roundtables, participants discussed ways to make the Small Business Investment Company program more inclusive of women managers and women-owned businesses, as well as business education and other support mechanisms for women in finance.

• The Council identified and highlighted examples of effective tax credit incentives for investors who fund women-owned and women-led businesses, and explored tax incentives for financial institutions, hedge funds and private equity investment firms to direct more funds to women-owned and women-led high-growth business.

• The Council discussed the elimination of the carried interest loophole for firms that do not invest a certain percentage of their funds in companies with women founders.

• The Council advocated for sole source authority, and other strategies — including modernization of the document repository for certification verification and education about the process, and increased outreach and programming for women business owners. The purpose of these recommendations is to improve the Women-Owned Small Business Federal Contracting Program (WOSB FCP). Sole source authority was passed by Congress in the National Defense Authorization Act of FY2014.

• In a public meeting and roundtable dialogue in Austin, Texas, the Council encouraged women’s participation in exporting as a strategy to grow their businesses. The Council intends to partner with the SBA Office of Advocacy to conduct groundbreaking data collection, the result of which will be a publicly-available, gender and ethnicity aggregated dataset on businesses that export, and their economic impact. Encouraging entrepreneurial firms to internationalize represents a substantial economic development opportunity.

• The Council hosted an event in collaboration with Comcast Corporation, connecting procurement officials and successful women suppliers. The Council continues to encourage major corporations to increase spend with women-owned firms and to support women as they prepare for corporate procurement opportunities.

• The Council met directly with the Small Business Procurement Advisory Council to discuss best strategies and tactics, potential improvements to the WOSB program and other tools to reach the 5.0% spending goal within FY2016.

• Council Members worked to strengthen the coordination of Women’s Business Centers, Small Business Development Centers and other SBA resource partners at the regional and local level.

• The Council supported efforts to reauthorize and improve the WBC program, including:

increasing the appropriation and the individual center grants, as well as improving the data collection process.

• The Council discussed opportunities and tactics to recruit more women into the Small Business Investment Research (SBIR) and Small Business Technology Transfer (STTR) programs, based on a need identified by a previous internal research analysis conducted in partnership with the SBA Office of Women’s Business Ownership. Council Members facilitated a dialogue about these strategies at the national conference in Washington, D.C.

• The Council fostered local and industry-specific dialogue about the factors that lead to hiring and scaling, in an effort to model success stories and share growing pains that women entrepreneurs can learn from.

• Through convening roundtables in Detroit, Michigan and Austin, Texas, the Council considered the unique challenges to commercialization for women in STEM and subsequently decided to pursue this as a research topic in the future.

• The Council also analyzed the pitch decks from the 2014 SBA Growth Accelerator Prize Competition. The purpose of this analysis was an inventory of the accelerator and incubator programs that have a specific focus on women or had women in leadership roles, and an identification of best practices related to women’s participation in these programs.

3. PUBLIC MEETINGS

December 8th, 2014

March 25th, 2015

“Preparing to Grow: Learn What it Takes to Scale Up” Web Conference The Council focused on women’s ability to grow and scale their businesses, exploring the opportunity, resources and support needed to do so. For this online dialogue, the Council brought together a distinguished group of women to discuss the resources and tools available to women entrepreneurs to expand their businesses. The panel featured:

• Vanessa Green, CEO of FINsix

• Phyllis Newhouse, CEO and Founder of Xtreme Solutions

• Kari Warberg Block, CEO of Earth-Kind Inc. and Council Member

Each of the panelists are incredible women who have not only grown their own businesses but have helped other women do the same. The meeting tackled questions such as: Why is it so challenging for women to access the growth capital their companies need to move quickly, respond to market changes, and grow? What are the programs and resources women entrepreneurs can leverage as they pursue growth? The Council also invited Kerrie MacPherson, Principal, Financial Services Office, and Entrepreneurial Winning Women North American Executive Sponsor at Ernst & Young LLP, and John Spears, Director of Clusters and Skills Initiatives at the U.S. Small Business Administration to share more information about those programs. A recap can be found here:

https://www.nwbc.gov/content/preparing-growth-learn-what-it-takes-scale-reportback

“How Women Entrepreneurs are Revitalizing America” Detroit, Michigan In honor of Women’s History Month, the Council headed to Detroit, Michigan — a city in which leaders of the government and business community have identified entrepreneurship, and specifically women’s entrepreneurship, as a dynamic force for revitalization. The Council wanted to spotlight the local entrepreneurship ecosystem, with a focus on the role that women play. The Council spent some time in Detroit visiting with different businesses and hubs, bringing together local leaders, stakeholders, and women entrepreneurs for four roundtable discussions. Topics included social entrepreneurship, access to capital, opportunities for women in STEM, and scaling and corporate supplier diversity opportunities. Supplier diversity procurement officials from leading automotive corporations joined, including: Chrysler, General Motors Co. and TOYOTA. It was important to highlight the resources and support available in Detroit, to create opportunities for local connections to be made and to share best practices and business strategies. The Council Chair also delivered the keynote address for Inforum, a leading women’s professional organization in Detroit, and was interviewed by Stephen Henderson, Pulitzer Prize-winning Editorial Page Editor of the Detroit Free Press. A recap can be found here:

https://www.nwbc.gov/content/nwbc-meets-women-entrepreneurs-detroit.

https://www.nwbc.gov/content/preparing-growth-learn-what-it-takes-scale-reportback https://www.nwbc.gov/content/nwbc-meets-women-entrepreneurs-detroit

June 23rd, September 11th, 2015

“Women’s Entrepreneurship on the Rise — Austin and Beyond” Austin, Texas The Council visited Austin, Texas — a city known for its robust entrepreneurial spirit, and specifically for successful women entrepreneurs in state-level procurement and exporting

— to meet with women entrepreneurs, local policy leaders, program managers, and investors and learn “what makes Austin so great.” This meeting’s panel included:

• Christie Barany and Courtney Turich, Co-Founders of Monkey Mat

• Gay Gaddis, CEO and Founder of T-3

• Gary Lindner, President of PeopleFund

• Whitney Johns Martin, Co-Founder of Texas Women Ventures

It was clear that there are a variety of programs; but most exciting, there is a passionate core of people dedicated to promoting Austin’s commitment to investing in women. The Council noted a recurring theme of mentorship. Whether in scaling, exporting or government procurement, business leaders and stakeholders agreed on the importance of a good mentor. In an interesting example of how women leaders impact workplace culture, Gay Gaddis shared how her thinking evolved about what an inclusive work environment looks like after three of her most valued staff became pregnant. She asked them to come back to the office with their babies — not just in a nursery, in the boardroom. A recap can be found here: https://www.nwbc.gov/content/women%E2%80%99s-entrepreneurship- %E2%80%93-austin-and-beyond-report-back

“Spreading the Wealth: Getting Venture Capital to Women Entrepreneurs” Web Conference Continuing to investigate resources that support high-growth women entrepreneurs, the Council hosted a conversation on women’s access to venture capital. While the growth of women-owned and women-led business is great, these businesses may not always be growing as much as they could. Women continue to lack access to the crucial assets they need to launch and scale their businesses, specifically in the arena of raising venture capital. Women-owned and women-led enterprises receive only 4.2% of venture capital and only 4.0% of women work in the upper echelons of venture capital firms. During this online session, a panel discussed the importance of venture capital for women-owned and women-led firms, shared best practices and actionable insights on how to secure venture capital, and proposed solutions, such as: finding and supporting women who work in venture capital or carried interest loophole for venture capital firms that do not fund female-owned or female-led firms proportionally to male-owned or male-led firms. The panelists included:

• Trish Costello, Founder and CEO of Portfolia

• Jules Pieri, Co-Founder and CEO of The Grommet

• Julie Pimsleur, CEO of Little Pim, Founder of Double Digit Academy

• Jeanne M. Sullivan, Co-Founder of StarVest Partners

A recap can be found here: https://www.nwbc.gov/content/spreading-wealth-getting-venture-capital-women https://www.nwbc.gov/content/women%E2%80%99s-entrepreneurship-%E2%80%93-austin-and-beyond-report-back https://www.nwbc.gov/content/women%E2%80%99s-entrepreneurship-%E2%80%93-austin-and-beyond-report-back https://www.nwbc.gov/content/spreading-wealth-getting-venture-capital-women https://www.nwbc.gov/content/spreading-wealth-getting-venture-capital-women