In 2008, there were an estimated 1 million women-owned small businesses in the United States, generating $918.3 billion in sales. These businesses were calculated by the National Women's Business Council to have an overall economic impact of $2.8 trillion due to the creation of nearly 24 million jobs, which represents 16% of all US employment. The number of small businesses owned by women is expected to continue to grow. There are a number of government funding programs for women to help them set up or run their small business successfully.
The Small Business Administration (SBA) Guaranteed Loan Program
SBA loans are set at very specific terms and guarantee up to 85% of the value of a loan which the woman business owner manages to secure from a private lender. It is not a grant, nor is it always a cheap loan. Obtaining a loan is always dependent upon the borrower having a sound financial background with a good credit score. The borrower will also need either financial statements dating back three years or a detailed business and financial plan for a start-up company.
The SBA Surety Bond Program
Surety bonds guarantee up to $10 million on business contracts, promising to assume a percentage of the loss if the woman-owned small business should fail to meet its contractual obligations. This program gives women the chance to bid on lucrative government and other contracts on a more equal footing with larger companies.
The SBA Venture Capital Program
Venture capital programs run by the SBA through their Small Business Investment Company (SBIC) control public and privately held capital. The capital is to be invested at favorable rates to certain types of small businesses, included women-owned small businesses. The program operates like any other venture capital fund, seeking high rates of return on the capital invested for the benefit of the shareholders once the business shows profits.
SBA Women's Business Centers
The SBA offers Women's Business Centers in all 50 states to give advice, counseling and training on all aspects of setting up as a woman-owned small business and help them obtain funding from a variety of public and private programs. Interested women entrepreneurs can take a variety of training workshops to learn how to start up their new business, including gaining funding or keeping their business running even in lean economic times.
Government Grants
The Department of Health and Human Services runs the Grants.gov website, which lists the 26 Federal grant agencies which offer grants for a variety of purposes, including grants to fund and support women-run businesses. The agencies also award grants to women involved in special social projects, women who are minorities or rural dwellers, and women who are engaged in certain kinds of environmental research projects.
Women-owned Business Initiatives
Government-backed for-profit and non-profit groups focusing on supporting women-owned businesses can also be good sources of funding. Loans, fundraising by women in order to help women, mentoring and assistance in raising investment capital are just a few of the ways these initiatives can help entrepreneurial women get started running their own business or growing their small business.
All women seeking funding should have a detailed business plan and financial plan and be sure their credit report is in good order before seeking funding. They should also be vigilant in avoiding any women's small business grant scams which they might encounter on the internet.
National Women's Business Council
The National Women's Business Council offers advice and listings of government resources for women-owned businesses. They conduct detailed research on the impact of women-owned businesses in the US and help women-owned businesses compete for government contracts.
Resources:
US Small Business Administration: Women's Business Center
US Small Business Administration: Financial Assistance Programs
Small Business Administration: List of Women's Business Centers
US Small Business Administration: Office of Women's Business Ownership Grants
US Business Grants: Current Listings
Small Business Association: Resources for Women
National Women's Business Council: Government Resources
National Women's Business Council: Women Business Owners Fact Sheet
Women's Owned Business Networks for Women
Evelyn Trimborn - Evelyn Trimborn is a freelance writer who frequently contributes to a number of blogs, including: healthful-goddess.com, ...
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