Gloria Castillo smiles knowingly when she hears people talk about women who have fled corporate America to pursue a life of freedom in entrepreneurship. “There isn’t as much freedom as it seems,” says the 43-year-old president of Monarch Marketing Group, a Chicago promotional marketing firm she and several family members run.
“It’s a path that appears attractive now because there’s a lot of discussion of flexibility. . .But to make a business successful is an all-consuming task, is much lonelier than most people realize and the support services of a corporation just aren’t there. There you are at 1 o’clock in the morning fretting over a PowerPoint presentation.”
Apparently, fewer women — and men — are heeding this message and are opting to go solo. A new study shows 46 percent of women business owners — and 52 percent of men — cited the need for flexibility in their careers as an important factor in hanging out a shingle. Also, women who started businesses fewer than 10 years ago are far more likely to have fled the proverbial glass-ceiling constraints than those who started their companies 20 or more years ago, according to the study by the New York-based Catalyst working women’s research organization; The Committee of 200, a female executives club; and the National Foundation for Women Business Owners (NFWBO). The study was underwritten by Salomon Smith Barney.
The study of 800 women and men entrepreneurs found 22 percent of women in newer companies had hit that barrier to the upper echelons of corporate life, while just 9 percent of women in older companies cited the glass-ceiling problem. Among the newer entrepreneurs, 14 percent cited lack of fulfillment or challenge in their corporate jobs, while just 8 percent of longtime entrepreneurs cited that as motivation for starting companies. It should be noted that the spark of an entrepreneurial idea was the biggest motivator across all
experience levels, but the percentages citing that reason were higher in the more experienced group than in newer owners.
“Women are most likely to start their own enterprises because they recognize opportunities to implement entrepreneurial ideas or do for themselves what they were doing for their employers,” says Lois Haber, chief executive of Delaware Valley Financial Services Inc., in Berwyn, Pa., and NFWBO chair.
Still, researchers were surprised by the growing numbers of entrepreneurs dissatisfied with corporate life. “Twenty years ago women were more likely to have spent time in clerical positions, while today most entrepreneurs have been in management jobs, making the trend all the more interesting,” notes Catalyst researcher Jennifer Allyn. “The message here is that women have strong expectations, and they are saying if we can’t fulfill them in this (corporate) environment, we will strike out on our own.”
Exactly why more women are unfulfilled than men was unclear, but Allyn says focus groups revealed glass-ceiling frustrations; women having to train men who then leapt above them on the corporate ladder.
“If they were working hard and not getting credit, that was a big part of it,” Allyn says. That credit often is facilitated by informal networks, an area from which many women still feel excluded, she says.
In the survey, 47 percent of those citing glass-ceiling problems said their own contributions were not recognized. While nearly a quarter of the women said higher pay would bring them back to corporate life, 58 percent said nothing would lure them back.
The study also found that men are most likely to start companies related to the field they left behind, while women are more likely to turn personal interests into a business. That may explain why women’s businesses haven’t reached the economic scale that men-owned firms have, says Castillo, who spent 12 years in magazine advertising sales before joining the family firm. “People don’t talk enough about having a strong corporate background. It gives you the vision of the kinds of companies you’ll be doing business with, and the networking is invaluable. I use a number of support services from relationships I made when I was on the corporate side. If you really have the Big Idea at age 25, great. If you’re just going to be one more free-lance graphic designer or information technology person, stay in your big company a little longer and get that foundation.”
