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MRIDULA VELAGAPUDI

Assessment Of Women
Entrepreneurship In India
Follow-up chapter to the Book
“WOMEN ENTREPRENEURSHIP: Role Of Women Entrepreneurship Towards
More Inclusive Economic Growth”

Mridula Velagapudi
http://mridulavelagapudi.blogspot.com
4/30/2011

This paper is a follow-up chapter to my book “WOMEN ENTREPRENEURSHIP: Role


of Women Entrepreneurship Towards more Inclusive Economic Growth”. It is an
essence and shows the data analysis done around the factors that drive or inhibit
Women Entrepreneurship in India.

© Mridula Velagapudi
SOME REVIEWS FOR THE BOOK

“Mridula, Template for the interview is good. It covers a broad range of sub
topics involved in entrepreneurship without losing focus on the real issues. Domain
selection is also well balanced. As presented, starting from "home services", selling home
made products, offering financial advice, consumerism to waste management, the material
provides, for a new comer to entrepreneurship or just to study the field, a good beginning.

One of the important things that it brings out vividly, in almost all the interviews is
that, a solid (backstage at home) support is required to keep the focus on the work; in this
case running the business. As one author puts it (in one of the last interviews), there is no
balance, one has to sacrifice a lot in one place to get success in other places. Of course, in
few cases luck has played its role too.

If only you could have collected more details, I mean data points in terms of hours
put in; number of employees, approx. investment etc. this study could be published
academically as well.

There were some grammatical errors in quite a few places. No one is perfect. Please
minimize them. All in all a good work.”

- Dr. Rengarajan Seshadri, Ph.D,


Head Core Development, SemanticInsights

"Mridula, your book inspires current entrepreneurs and budding entrepreneurs


alike. Especially liked the Preview of each segment which gently drew me into the following
chapter hungry to read and learn about the next story. The business models and segments
chosen are very interesting and are sure to inspire a lot of women sitting on the fence. The
maverick women in me had always thought about taking the entrepreneurial plunge;
reading your book has most certainly reassured my belief."

- Shilpi Sharma,
Budding Entrepreneur,
ex-Relationship Manager, Mahindra Satyam

“Initially I was a bit hesitant to read the book, given the lack of perceived relevance
for me and the title reminiscent of a doctoral thesis. And as I started reading through it, the
hesitance gave away - bit by bit (Bullet points, and shorter paragraphs would have
accelerated the de-hesitancy bit; but then one can't have it all).

The prologue could have been a trimmed more than a bit, as well as intros into each
of the 19 cases. The set up was good, drawing the reader into each of the cases in a
meaningful manner, than they appear to be on a cursory glance. The questions are to the
point, charming the protagonists into laying out their experience and wisdom out there for
the reader to profit from. The fields chosen are diverse and interesting; most apt for a single
individual with possibly fewer resources (time, money, capital inputs) but with a sound idea
and unbridled passion to bring it life and make it succeed.

It may not be completely educative in terms of how to go about setting up business


from scratch to success - but is inspiring enough to make a hesitant entrepreneur to take
that first step. As Anjana Vivek mentions in her interview - "The main challenge for me is
my mind-set, to go ask for work and then ask for money". Practical aspects like these -
sprinkled across pages are what make it worthwhile to read through. I hope, though there
will be a 2nd edition, one which is more engrossing as this one is educating and earnest in
its attempt. Pictures of the entrepreneurs (if permitted) or their company logos (or just plain
business card - to ignite the passion in one) will definitely add to the interest quotient and
make the reading easier.
As of now, break a sweat and buy the book. Don't wait for the bells and whistles to
goad you. For, if you are waiting for inspiration beyond an honest portrayal of every person
like you who has taken that definitive step towards pursuing their goal - no book or wisdom
will be good enough!”
- Arun Vemuri,
Partner-Business Planning, Mindshare

"This book is an idea whose time has come. Never before in human civilization have
women been equal partners not just in raising family, but in powering economic
development. In the past, if women took to entrepreneurship, it was simply to supplement
family income. But today, even women can have game changing ideas and can be as much
of trail-blazers in building highly successful enterprises. Even Mompreneurs are not just
„livelihood‟ entrepreneurs any more, content with just starting at home something to „keep
themselves occupied‟ but are serious surplus creators. This book captures and glorifies the
wealth- creating spirit of women entrepreneurs."

- Prof. Nandini Vaidyanathan


Alumnus, The London School of Economics & Delhi School of Economics
Co-founder & Mentor, CARMa Venture Services

“….What Mridula has managed to do is bring out consistent threads of information via
her questions from each entrepreneur she spoke with. One can see some patterns emerging
through the book……..Books like these play an important part in highlighting streaks of
innovation and change, which typically get little attention in mainstream writing. Overall an
easy and simple read especially for anyone interested in the subject.” Read the full review.

- Pluggd.In,
India’s Leading online directory on Start-ups
ASSESSMENT OF WOMEN
ENTREPRENEURSHIP IN INDIA
I decided to publish this follow-up chapter based on suggestions from
readers and on my own keenness to bring out the critical analysis of the women
entrepreneurship situation in urban India vis-à-vis the international arena. If you
read my book with this chapter in the backdrop, you will appreciate why I have
written the book and understand that there is more than just a ray of hope for
„women entrepreneurship‟ to advance in India. I have tried to give comparative
analysis supported by data. But before I start to present the comparative analysis, I
would like to specify the substance of my book.

My book brings out the importance of some key facts after reading the
interviews of the 19 women entrepreneurs. I want readers to understand and learn
from the stories of these 19 women – adopt the positives (advantages) and explore
how to improve upon the negatives (obstacles). There are four points which stand
out in my book:

1) It is not necessary that a woman should have a career as defined


and as streamlined as their men counterparts, mainly due to the fact that
women have to balance motherhood also with their professional career. It is
important that women understand that they can start their entrepreneurial
journeys based on their comfort level with the stages of their family lives and
the support system that they have. Some women may have their parents or
in-laws living close-by or with them. For such women, it may be much easier
to pursue their dreams. On the other hand there maybe women who do not
have a good support system and may have to start their career after the kids
grow up. My book covers stories of 19 women who have started their
entrepreneurial dreams at very different stages of their lives.

2) There are many opportunities to start small businesses which can


usually be started as bootstrapped businesses. It is important to look for such
opportunities. Small and medium sized businesses are getting
more importance in the wake of the recent recession. Clusters of growing
SMEs/SMBs can hold the economy to the ground by generating many
different types of jobs and not create a job 'monopoly' as is done by
behemoth organizations. A fall of such few big organizations can lead to
severe job erosion, which can further lead to recession - a fact witnessed by
many in the recent global financial meltdown.

3) It is true that entrepreneurship is needed for robust economic


growth. It is also true that women are the economic force which has still not
been tapped to its full potential. So it is important to induct them also
into entrepreneurial culture, with focus on their specific needs. This book will
help women in understanding how to spot opportunity gaps. It has industry
snippets followed by a story of a women entrepreneur. It is interesting to read
these stories in the backdrop of short industry analysis of diverse segments
and understand the possibility of creating a business viz-a-viz such segments
where opportunities exist.

4) My effort here is to encourage entrepreneurship as an opportunity


to create a value-added business; and not as a necessity, which is typical in
case of rural entrepreneurship or street entrepreneurship – self-employment
chosen by women out of poverty or other necessity. My focus is to encourage
entrepreneurship in the urban highly educated women; to encourage
opportunity women entrepreneurship; to choose entrepreneurship when
alternate lucrative employment options exist. The industry snippets in my
book followed by relevant stories of women entrepreneurs encourage other
women to take entrepreneurship in diverse segments as opportunities for
creating wealth. It encourages them to think creatively and look for
possibilities beyond the typecast self-employment of opening a garment
boutique or conducting subject-wise home tuitions in the traditional way.

5) Women as entrepreneurs add to the diversity when it comes to


starting businesses as well as offering solutions. Importance of including
this diversity is felt much strongly especially after the recent recessions and
is being further explored across the globe. My book highlights technically
“Why Women Entrepreneurship” and hence shows how women
entrepreneurship is important for an inclusive economic growth.

It is very clear from the 19 cases of the women entrepreneurs, that almost all
of them have fabulous family support. By family support I mean the support that
they receive either from their parents or their in-laws for managing the show back
at home, managing the household and the kids. To be specific, women have a very
good system of “joint family” culture to bank upon in India; not to forget the
support (moral and hands-on) extended by their spouses and the cheap labour
available in the form of domestic help such as aayas, nannies and cooks. The
following graph will give you a better picture of this fact:

12
Number of Women Entrepreneurs

10

0
Joint Family (In-laws or Nuclear Family No Kids in the family
parents living together)

Figure 1
Out of the total cases 52% (Figure 1) of women have family support where
kids can be taken care of by grandparents.

Regarding co-founding their start-ups, majority of the women have either co-
founded with their husbands or they have started it alone.

9
8
7
6
5
4
Series1
3
2
1
0
Anyone from Spouse as Co- Friend as Co- No Co-founders
immediate founders founders (Founded Alone)
family

Figure 2

Around 42% of these women entrepreneurs started their ventures alone and
31.5% of women co-founded their start-ups with their husbands. If we combine the
two categories – „spouse as co-founders‟ and „Anyone from immediate family‟, we
find that it also accounts to 42%.

On the funding side, it was clear that out of the 19 women entrepreneurs, all
of them have self-funded their businesses. Whereas it is good to start with own
funds and bootstrap your venture, but not every woman might have enough funds
to go beyond kick-starting their ventures or businesses. Do we have enough
investors‟ interest in funding a company owned by a woman? This is an important
point to be probed further.

In India women make up only approximately 15% of the entire


entrepreneurial population. Out of this 15% a bigger proportion of women
entrepreneurship comprises of necessity-based entrepreneurship primarily from
rural India and of surrogate entrepreneurship where the businesses are registered
in the name of women but are run by men. In fact, India ranks quite high in overall
necessity-based entrepreneurship and ranks low in opportunity-based
entrepreneurship, according a GEM (Global Entrepreneurship Monitor) report.

Remarkably a bigger percentage of women in the developed countries such


as USA, UK, Canada, Germany and Scandinavian (Nordic) countries take to
opportunity-based entrepreneurship. In USA alone women entrepreneurs own
about 40% of all the enterprises.
According to Center for Women‟s Business Research, McLean Virginia, the
overall scenario by 2008-2009 shows that around 10.1 million firms are owned by
women in the United States. These women-owned businesses constitute 40% of all
the privately held businesses. Out of these about 75% are majority women-owned
firms. Moreover 3% of all women-owned businesses have revenues of $1 million or
more as compared to 6% of all men-owned businesses. The United States Census
Bureau predicts that by the year 2025, the percentage of women entrepreneurship
will increase to over 55%.

It was reported in Canada‟s Labour Force Survey that in 2008 women


accounted for about one-third of all the self-employed people. This means about
33% of all the entrepreneurs were women as of 2008. Though self-employed here
could include people like franchise owners too, but for broader discussion I am
including the data for self-employed people.

As of 2007-2008, women accounted for about 27% of all the self-employed


population in UK. Similarly the Nordic countries have an average of 33% of women
as entrepreneurs out of total entrepreneur population.

Women Entrepreneurs as Percentage of Total Self-


employed Population between 2006-2008
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
France Germany US UK Canada Nordic India
(Denmark,
Finland,
Iceland,
Norway and
Sweden)

Figure 3

Many studies have been carried out in these countries to understand the
motivation factors behind women taking up entrepreneurship. Most of such studies
reveal one of the following reasons to start their own ventures:

1. Self-actualisation
2. The need to be their own boss
3. Dissatisfaction with working for others
4. Increase in desire to control
5. Flexibility in work hours to balance work and family
6. Philanthropic commitment towards their communities and economy.

Unlike India, much of the western world does not have the culture of living
in joint families. Nor do they have access to such cheap labour as aayaas, nannies
or cooks. So how is it that more women in countries like USA, Canada and UK are
able to contribute by taking up opportunity-based entrepreneurship? Although
much of the businesses owned by women fall under small businesses category,
that is still commendable and encouraged as the small businesses definitely form
the backbone of an economy.

The 19 cases presented in my book are actually carefully selected to


highlight that women entrepreneurship is possible in India in diverse industries
while making use of the „positives‟ of our society and economy. So, it brings me to
contemplate, if women can enjoy some benefits like that of family support in India,
why is it that women (especially in urban India) constitute a very weak percentage
as opportunity-based entrepreneurs when compared to those in the Western world?
India, being a developing nation with economic growth rate hovering in the range of
7.5%-9%, poses many entrepreneurial opportunities in almost all segments. Is
there some serious issues which should be sorted out so that more women in
urban India take up entrepreneurship as a career?

Some of the prominent issues which I think of are subjective in nature.


These are either inherent as personality traits or prevalent as attitude problems in
our societal set-up. The observations below are based on my personal reflection
also of many women who I have come across in last ten years of my life when I have
travelled and lived at many different places.

Inherent Issues (Personality traits):

1. Lack of confidence and aggressiveness to pursue big business.


2. Lack of motivation and complacency post marriage. Although many
women gain professional education and pursue a job career before
they get married, many do not get back to work life simply because
they lack the drive (even if they have family support). As far as
entrepreneurship as career is concerned, it also takes a back seat
especially when combined with point number 1 here. There is a severe
lack of motivation as is evident from the fact that the contribution of
professionally educated women towards entrepreneurship is lesser
than that contributed by self-employed women, driven towards
entrepreneurship out of necessity.
3. Content with small turnover businesses which can be run from home
such as selling ethnic wears and other household décor materials.
Many women just stick to the age old formula of selling ladies and
children‟s wear and household décor stuff and as a result you will see
a plethora of such home-businesses with no value add. In fact, even
professionally qualified women forget to understand their own
potential. They fail to ascertain other business opportunities that
exist and which can also be pursued from home especially in today‟s
era of enhanced broadband connectivity and social networking
avenues.

Acquired Issues (Societal bars):

1. Less encouragement from close family and friends and a mark of guilt
that the kids will get ignored. Though the 19 cases published in my
book “WOMEN ENTREPRENEURSHIP: Role of Women Entrepreneurship
Towards More Inclusive Economic Growth”, have not hinted at any
family conflicts as far as work-life balance is concerned, there are still
many such households which may not have elders in the families with
such modernistic attitudes that the women should be career-oriented.
Entrepreneurship certainly is out of question as running a business is
perceived as more time-consuming, though doing a job may still be
permissible. (According to me this is not the case. My personal
experience says that jobs can be extremely taxing too as far as
personal life is concerned).
2. Less confidence shown in the business world by the men counterpart
when a woman approaches for business or funding (attitude issues).
Whenever a women-led company approaches another company (not
woman-led) usually the deal is viewed with scepticism. This is so
because people have lesser confidence on women‟s abilities to carry
on a business.
3. Even the external investors are shy of investing in women-led
entrepreneurial ventures (though I do not have any data to support
this at this point in time).

Opportunity women entrepreneurship has shown growth albeit slowly. To


further encourage it in urban India, I would highly recommend following three
things:

1. Provide specific mentorship to women as they have different


challenges at different stages of life.
2. Focus on developing entrepreneurial skills right from the college level.
Introduce special Entrepreneurship courses and/or workshops to
enhance leadership skills and self-confidence.
3. Self-educate and educate others regarding giving freedom to women
as far as raising family is concerned. They should be able to decide
what they want and when they want, without feeling obligated.
4. Establish business women‟s alliances for more women to collaborate
and network with each other and inspire more women towards taking
up opportunity entrepreneurship.
5. Establish mentorship which involves successful women entrepreneurs
as role models.
References
Dimakopoulos, V. (2010, January 12). Women’s Entrepreneurship: Opportunity
or Obligation?, Women’s forum for the economy & society. Retrieved from
http://www.womens-
forum.com/media/pdf/2010_BS_Women_Entrepreneurs_BackgroundDocs.pdf

How many small business owners are women?. (2011, April 20). Industry
Canada. Retrieved from http://www.ic.gc.ca/eic/site/sbrp-rppe.nsf/eng/rd02504.html

The future of the global economy: women. (2010, October 15). Women
Entrepreneurs Grow Global. Retrieved from
http://womenentrepreneursgrowglobal.org/2010/10/15/the-future-of-the-global-
economy-women/

Some facts about women entrepreneurs. (n.d). Go4Funding. Retrieved from


http://www.go4funding.com/Articles/Entrepreneur/Some-Facts-About-Women-
Entrepreneurs.aspx

Harding, R. (n.d). State of women’s enterprise in UK. Prowess. Retrieved


from http://www.prowess.org.uk/documents/StateofWomensenterpriseintheukfinal.pdf

Damwad. (2010, August). Women entrepreneurship – a Nordic perspective.


Nordisk Innovations Center. Retrieved from
http://www.nordicinnovation.net/_img/women_entrepreneurship_final_report_web.pdf

Welter, F. (2004, May 27). Women entrepreneurship in Germany and access to


capital. Institutet för entreprenörskaps- och småföretagsforskning. Retrieved from
http://www.esbri.se/oh_estrad/estrad__(fw_27_5_04).pdf

Conceptual framework. (n.d). United Nations ESCAP. Retrieved from


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small and cottage industries in India. International Labour Organization. Retrieved
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