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11 million strong: Women small business owners’ unique challenges and 3 solutions to fix them

October 17, 2018 | Small Business Loans
11 million strong: Women small business owners’ unique challenges and 3 solutions to fix them, CDC Small Business

They’re inventors, fitness and health gurus, financial experts, trend-setting retailers … and the list goes on. Women are starting businesses in the U.S. at a faster clip than ever before. In fact, an average of 850 new female-owned firms are started every business day, adding to the 11 million-strong base already standing.

Women have made significant strides as entrepreneurs, especially in the recent decade. However, they continue to face unique challenges their male counterparts don’t, from a shortage of role models to disproportionate access to venture capital dollars.

Fortunately, help is out there to ease these challenges. Whether it’s free or very low-cost services funded by the U.S. government or working with community-focused lenders whose niche is aiding underinvested groups — women small business owners have effective resources at their fingertips to help them reach their business goals.

Challenge #1: I need help with my financial projections to get loan-ready. Is there help?

If you’re a new business in need of a small business loan, then you’ll need to write up a business plan and create realistic financial projections, also known as forecasts. These required documents help the lender understand your business more deeply and whether you’ll have the capacity to repay your loan.

These documents also serve as a helpful roadmap for the business owner. Financial projections help you plot out your goals and benchmarks to ensure your business is on the right track. Many entrepreneurs don’t know where to begin. So where can they turn?

Related: Why Businesses Need Financial Forecasts

Solution: Find your nearest Women’s Business Center

Andrew Erickson, a loan officer at leading business lender CDC Small Business Finance, knows first-hand the great work performed by Women’s Business Centers. Funded and run by the U.S. Small Business Administration, or SBA, these centers offer personalized business counseling, workshops, training, among other services for women small business owners.

Erickson, whose area of focus is Riverside County, turned to the Inland Empire Women’s Business Center when he had a borrower who needed help fleshing out her financial projections, in the lead-up for getting financing for her laser-tag facility.

“They really took a hard look at the numbers for her” and played a key role in creating a realistic financial forecast that she used in her business-loan application, he said. Thanks in part to the guidance from the Women’s Business Center, the borrower was approved for financing through CDC.

To find your local center, check out this state-by-state directory.

Challenge #2: I’m struggling to find a mentor – Where can I look for one?

When you’re trying to achieve big goals, it helps to have reliable, expert help. This is especially true in entrepreneurship, which can be a lonely, anxiety-ridden journey.

Consider these eye-opening stats about mentorship:

  • Entrepreneurs who have access to mentors report higher revenues and growth.
  • Adults are five times likely to say they’d like to launch a business if they received some form of mentoring.

Solution: Locate a SCORE mentor

Find qualified business mentors to help talk to you through your business idea or work out a hard-to-crack problem through SCORE. This is the nation’s largest group of volunteer business mentors. They’re at your disposal to provide you business coaching at no cost to you.

SCORE can pair you with a mentor in pretty much any field. The organization also offers workshops and educational resources. The organization also maintains a fabulous database that allows you to filter mentors by field, expertise and even ZIP code.

This proved to be a great resource for Rodnia Attiq, owner of El Borrego restaurant in San Diego’s City Heights neighborhood. When it was just a makeshift eatery situated on a driveway, Attiq turned to a SCORE mentor for expert help on how to properly grow her business and graduate it to a restaurant storefront.

The organization paired Attiq with a coach who not only had a long history of professional business experience, he was also relatable culturally; they’re both of Mexican descent. He closely led her through many of the business milestones, including opening a business bank account to obtaining the proper licensing.

Attiq felt like she received a comprehensive education in entrepreneurship within a condensed timeframe, which helped accelerate her growth trajectory.

“Instead of going the long way, he led us through the shortcut to help us obtain our goals,” she added.

Without a doubt, the help Attiq received from SCORE helped set her up for business-loan success. In 2017, she received an SBA Microloan through CDC Small Business Finance, a leading small business lender that provides affordable, reasonable financing to entrepreneurs in California, Nevada and Arizona.

Related: How free counseling through these nonprofits can help you get a business loan

Challenge #3: I was turned down by a traditional lender for a small business loan. What now?

Did you know women small business owners in need of business capital are more likely to be turned down for loans than men? Here’s another disheartening figure: Firms exclusively owned by men are four times as likely to receive venture capital funding compared to women-led firms. How do we make up for this funding gap?

Solution: Work with a community-based business lender

You may already know that major banks have departments that exclusively provide clients small business loans. But what if you’ve tried that route and were turned down for financing?

Try community-based business lenders. Unlike traditional banks, these nonprofit lenders have more flexibility to lend to a broader group of entrepreneurs, especially those who need it the most, including women, veterans and minorities.

With support from trusted partners such as the SBA, SCORE mentors and others, community lenders focus on providing financing to all small business owners, even if you’ve run into minor credit issues in the past.

CDC Small Business Finance, for one, is a leading community-focused lender that does exactly that. Over the last four decades, we’ve financed 11,000 small businesses, totaling more than $13 billion in small business loans.

Of that total, we’ve approved $1.5 billion in financing for women small business owners buying their own buildings, and more than $33 million in other SBA loans for women entrepreneurs. Another benefit of working with CDC? Qualified borrowers can get free in-house business coaching from our in-house business experts, pre- and post-loan. So we not only can help you get loan-ready, we’ll be there for you even after your loan documents are signed.

How do you find a nonprofit lender? Check out the SBA’s Lender Match tool, which connects entrepreneurs like you to trusted business lenders across the nation.

As a lender focused on growing and reviving communities, we proudly serve all small business owners, from women small business owners to veteran-led firms. CDC Small Business Finance offers several loan options for business owners in all stages, from startups to longtime businesses wanting to buy commercial property.

Tell our loan experts about your business, and they’ll work to match you with a financing plan that best suits you. Let’s talk! Reach us at loaninfo@cdcloans.com or (619) 243-8667.

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