Majority women-owned firms, where 51 percent or more of the business is owned by women, are an important segment of U.S. businesses. Since 2007, women-owned firms in the United States, both the self-employed and firms with employees (“employer firms”), have been growing—in number and as a share of all U.S. firms. As of 2015, women-owned firms totaled over one million and accounted for one-fifth of U.S. firms. Among women-owned employer firms, jobs and annual receipts have grown since 2012. Between 2007 and 2015, the share of employment by small women-owned firms increased by twenty percent, while the share of employment by all small firms declined by about four percent. 

This report uses a unique data set to examine the experiences of women-owned small employer firms, especially as compared to their men-owned peers. Small employer firms have traditionally played an important role in U.S. job creation, and women-owned firms are an emerging share of the sector. Understanding the opportunities and challenges facing this growing segment of women-owned employers can provide insight into future economic contributions of the sector overall.

Topics covered include:

• Women-owned firms are more likely to experience financial challenges and growth limits than men-owned firms
• Women-owned firms depend on small denomination credit and personal assets to secure financing
• Women-owned firms utilize fewer types of debt and equity than men-owned firms, relying heavily on credit cards and Small Business Administration products
• Women-owned firms face persistent funding gaps and funding source mismatches, even when have lower credit risk