In Canada, women account for approximately 28 percent of the country’s entrepreneurs, according to a 2019 study by the Business Development Bank of Canada (BDC), a government-owned bank devoted to entrepreneurs.
Given that women and girls make up just over half the population, Canada’s government pledged to transform the imbalanced system in 2019 by launching the country’s first women entrepreneurship strategy, which aims to double the number of women-owned Canadian businesses by 2025.
At the moment, government statistics show that just 16% percent of SMEs in Canada are owned by women. But, these numbers are on the up. Numbers of female entrepreneurs have almost quadrupled over the last 40 years, showing that they are growing at almost 3.1 times the rate of male entrepreneurs.
Sonya Shorey. Image courtesy of David Kawai for Bayview Yards.
“It is critical to elevate, amplify and celebrate the achievements of women in entrepreneurship, business, STEM and professional fields to help inspire and empower the current and future generation of women leaders” — Sonya Shorey
However, this steady improvement is being halted by the COVID-19 pandemic, warns Sonya Shorey, Vice-President of Strategy, Marketing and Communications at economic development agency Invest Ottawa.
Despite claiming not to have suffered from blatant gender discrimination throughout her professional career — which spans a total of 24 years — Shorey believes that years of being either the only, or one of the few women at the table, have subjected her to “unconsious bias” which has meant that as a woman, she has always had to work harder to prove herself.
In the early years, Shorey found it challenging and intimidating to demonstrate her credibility, build confidence and elevate her voice, all challenges women continue to experience to this day.
And the pandemic, she says, has exposed them.
Childcare responsibilities
Although lockdown in Canada is lifting and people are returning in a limited fashion to offices and social settings, employees who are able to work from home are encouraged to continue doing so.
One sector that is yet to return to its pre-COVID norm, however, is education. Although guidelines vary according to province, most schools in Canada do not plan to return to full capacity for the remainder of the year.
Juggling homeschooling and childcare responsibilities with a full time job can be tricky for working parents. And, if they are heterosexual couples, Shorey says, women entrepreneurs are more likely to disproportionately suffer from the consequences.
According to a 2019 study by Visa, 24% of women SMB owners in Canada have children under the age of 18, and in heterosexual couples, mothers are more likely than fathers to take on child rearing responsibilities in the home, Pew Center Research data shows.
This is made worse by the inability to bring childcare into the home or outsource it, due to recommendations to stop the spread of the pandemic.
In many cases, this leaves heterosexual couples forced to make a decision as to who will undertake the childcare and who will focus more on professional responsibilities, Shorey explained.
And, because women generate less income, they are more likely to cede their professional responsibilities, she added. According to Statistics Canada, women working full-time jobs earn on average 75 Canadian cents for every dollar that men make. This gap is wider for indigenous, disabled or women of color.
If they chose not to give up their jobs, Shorey explained how many women entrepreneurs are struggling to find time to focus and be productive, because they are managing their children in a more intensive way.
“It’s incredibly challenging to juggle both [full time jobs and childcare, with homeschooling] simultaneously within a single home,” she added.
“More is needed to support women founders who do not have the ability to acquire childcare support within this current environment while building their business,” said Shorey.
“There has never been a greater opportunity to establish innovative models that optimize growth and success through an inclusive lens. This includes new types and sources of funding that help to address these challenges, and greater work life harmony that balances business and parenting.”
Lack of investment
According to news outlet The Globe and Mail, female founders receive just 4% of venture capital in Canada.
“And when you consider women founders from marginalized communities and equity-seeking groups, it’s almost non-existent,” said Shorey. “This must change – it demands focused action.”
Then, take this problem and then add a global pandemic to the mix.
“A lot of capital has significantly slowed, stalled or stagnated during this period,” Shorey explained, referring to funding opportunities during the current crisis.
“A lot of capital has significantly slowed, stalled or stagnated during this period” — Sonya Shorey
Part of the problem, she believes, is down to a general absence of female investors in the industry. For example, 14% of partners at Canadian VC funds are women, according to Female Funders.
“We need more women on the investment side of the table because research shows women investors are more likely to invest in women owned firms,” said Shorey.
Lack of role models
“I believe that if you can see her, you can be her,” Shorey said, explaining that for budding female entrepreneurs, role models and mentors are essential.
“It is critical to elevate, amplify and celebrate the achievements of women in entrepreneurship, business, STEM and professional fields to help inspire and empower the current and future generation of women leaders.”
2020 Global Forum on Women in Cybersecurity.
A lack of role models, she says, can cause confidence issues, such as the intimidation and low risk threshold Shorey experienced at the start of her career.
“When education is coupled with role models and mentors, it is an incredibly powerful combination that achieves impact” — Sonya Shorey
“When pursuing capital, research shows that male founders will often pitch their ideas in a big, bold and confident way, while women founders tend to adopt a more realistic and modest approach,” Shorey explained.
“Research published by The Beacon Agency and the Scotiabank Women’s Initiative found women entrepreneurs are more likely to employ capital from personal savings, personal lines of credit, and family and friends, as opposed to business sources,” she added.
The solution, she believes, is to expose female entrepreneurs to people that look like them from the very beginning, which starts with education.
“When education is coupled with role models and mentors, it is an incredibly powerful combination that achieves impact. It creates the opportunity to inspire and equip even more women for growth and success in entrepreneurship, investment, business and tech.”
Taking action
When it comes to actively prioritizing the support of Canada’s female entrepreneurs throughout this global crisis, it comes down to better equipping the next generation of future leaders to withstand similar challenges in the future.
Shorey references educational programs such as Algonquin College’s “We saved you a seat,” which reserves up to 30% of classroom seats in STEM courses for women, in order to attract them to pursue this career.
Schemes like this, as well as more opportunities for job shadowing, mentorship and advice — which can be provided through the education system — will create more examples of inspirational women succeeding in the sector to in turn encourage others to follow suit.
In the immediate future, Shorey believes it is critical to build on the important steps taken to date, and further equip women founders and entrepreneurs with greater support during the pandemic. This is essential for those founders who have taken on additional caregiving responsibilities while building and scaling their company.
She suggests that grants that allow female founders to hire others to delegate business responsibilities would be a great help. The government boosted its child benefit scheme for parents in May.
Finally, Shorey says, increasing capital for women-owned firms at a time like this is “critical.” Targeted accelerator programs such as Invest Ottawa’s SheBoot Program offer investment of up to $100,000 for women-led businesses and are a good way of creating support within the ecosystem.
These must be combined with pandemic-specific relief programs for SME founders such as the Regional Relief and Recovery Fund and the Digital Main Street program.
Although Shorey is encouraged by the important steps taken and progress achieved to date, she believes there is “a long way to go” to equip, inspire and empower women from every walk of life in entrepreneurship, business and STEM.
“It is a journey, and one that will take women and men working together as a unified force to move this dial, and create long-term sustainable change.”
Disclosure: This article includes a client of an Espacio portfolio company.
Fewer women in VC firms = lower returns from diverse investment teams
Women entrepreneurs in STEM still find themselves cash strapped
