When families in the typical American home were polled by the Pew Research Center on who makes the decisions in a number of household areas – including family finances – women came out ahead:
- 43 percent said women made more decisions,
- 26 percent said men made more decisions, and
- 31 percent said decision making was equally divided.
Another finding was even more dramatic: when it came to managing the money, women decision makers outnumbered men two-to-one – 45 percent versus 23 percent. So perhaps it should come as much of a surprise that women are making some powerful moves in the world of crowdfunding.
March is Women’s History Month, and I suspect that the increasingly important role women are playing in crowdfunding will pave the way to women making some history in commerce and beyond.
Benefits of crowdfunding
One thing I like about crowdfunding in general is that much of it is facilitated totally online. This may help to lessen the impact of gender bias in a very general way. Indiegogo, one of the pioneers in crowdfunding, reports that 42 percent of its successful campaigns are run by women. But when men and women are in the same room together, even with well meaning people, it’s sometimes difficult to look past gender stereotypes.
Innovative websites such as Plum Alley and MoolaHoop have elevated the availability of capital to women even higher. They are developing a crowdfunding niche that specializes in helping women raise money. I noted in an earlier post on MoolaHoop that between 1997 and 2014, women-owned businesses increased in number by 68 percent, which is twice the growth rate posted by men. And this was before the entry of these women-focused crowdfunding sites!
Lifting women from poverty
When I say that increased entrepreneurship from women can change history, I’m not just talking about founding successful companies. The general well-being of society is closely associated with the general well-being of women. When women live in poverty they raise children in poverty and it tends to create a cycle that is very difficult to break. Small business formation is one of the best ways to break the cycle, and it’s probably a far more cost effective and long lasting way when compared to our welfare system.
Recently, I spoke at the United Nations regarding the importance of empowering women economically. One of the organization with which I work, The Institute for the Economic Empowerment of Women, helps women in Afghanistan and Rwanda start and build businesses. Five hundred women have gone through our program during the past nine years and we have an 80 percent success rate. On average each Rwandan and Afghan graduate creates jobs for 22 and 28 people respectively. So we are witnessing significant economic development in these countries.
Opening up a new front
In the 1960s the United States declared “war on poverty” and we have spent trillions of dollars fighting that war. I don’t think too many people would argue if I said that so far our success has been fairly limited.
Perhaps providing better access to funds for women-owned startups and business expansion projects will be like sending in fresh troops to fight the battle anew and bring victory into sight.