By Fran Pastore
Can you imagine owning and operating a successful business as a female just 25 years ago? Your balance sheet looks great and your credit is exceptional. Business is so good that you need to expand. You go to your local banker and attempt to get a business expansion loan and you are turned away. Not because you have poor credit, but because, even with your stellar financial statements and your fantastic credit, you STILL need a male relative to co-sign a loan for you. That”™s right ”” just 25 years ago this October, women”™s access to credit for commercial purposes required a male co-signer!
October marks the 25th anniversary of the historic passage of H.R. 5050 ”” legislation that led to an explosion in women”™s entrepreneurship. H.R. 5050 accomplished four important milestones:
1. Initiated women business centers (WBCs) to provide small business training, education and counseling to women who want to start or grow businesses. Nine years later, in 1995, Connecticut was one of a few states in the country, which did not have a women”™s business center. As an entrepreneur myself, I saw an opportunity and decided to start one and that is how the Women”™s Business Development Council was born, nearly seventeen years ago. In 2010, over 120 women”™s business centers helped to create 13,000 new businesses nationally; 36,578 new jobs; and supported existing businesses that contributed a collective $1.3 billion to the U.S. economy. That same year in Connecticut, WBDC assisted in the creation of nearly 120 new businesses and helped more than 140 existing businesses with operations, resulting in the creation of more than 240 new jobs. WBDC clients generated an estimated $40 million in gross revenue.
2. Established the National Women”™s Business Council, a nonpartisan federal advisory council to serve as an independent source of advice and counsel on economic issues of importance to women business owners. The 16 women, including myself, that comprise NWBC, advise the president, Congress, and the U.S. Small Business Administration.
3. Required that the Census Bureau include C Corporations when counting women-owned firms; C corporations owned by women were not included in the US Census data collection process.
4. And, yes, finally eliminated all individual state laws that required women to have a male relative co-sign a business loan.
Today, women entrepreneurs have benefited from a new procurement program put in place so that women owned companies can bid for contracts with restricted competition ”” opening up a public market important to their success. Access to credit is still an issue, but credit is no longer based on gender. WBDC is one of the leading WBCs in the country. And, if the new marketplaces to buy insurance succeed, women business owners will have fewer barriers to providing health insurance to their employees.
The number of women-owned businesses in Connecticut increased 35 percent since 1997 and sales at those firms increased by nearly 67 percent, according to an analysis of U.S. Census data by American Express OPEN, titled “The 2013 State of Women-Owned Businesses Report.” Connecticut firms exceeded the national average in hiring employees (up 17 percent in the state vs. 10 percent nationally) and in sales growth (67 percent vs. 63 percent). In Connecticut, we”™ve witnessed a 17.3 percent growth in jobs ”” or a whopping 92,000 positions ”” among women-led businesses, from 2007-11.
Women-led businesses have had a national growth rate of 1.5 times the national rate for all businesses.
It”™s exciting to imagine what the next 25 years will bring, and WBDC intends to remain in the driver”™s seat ”” educating and training women entrepreneurs throughout Connecticut and helping to continue to shape policy issues as they relate to women owned businesses nationwide.
Fran Pastore is president and CEO of Women”™s Business Development Council. She can be reached at (203) 353-1750.
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