According to one global report, family commitments, as well as the pandemic, posed bigger hurdles for women entrepreneurs than their male counterparts. In the survey spanning 49 countries, 18% of female entrepreneurs who quit or exited a business did so for personal and family reasons, compared to just 12.6% of men.
Our research examined the personal and family reasons behind women entrepreneurs’ decision to exit their businesses. While the respondents we interviewed were based in the United Kingdom, the responses reflected experiences seen in New Zealand and elsewhere. We found women entrepreneurs often felt they had no option other than to exit or close their business if they wanted to preserve a viable home life.
We interviewed 16 women founders in the UK who exited their startups for personal reasons largely unrelated to financial or performance issues. These reasons typically involved balancing household and business demands, and often included gendered responsibilities for child- and eldercare. Frequently, men’s careers came first in partner households. For instance, one beauty therapist closed her growing business to look after her children because her husband’s medical career was so demanding. As she explained: If we had both tried to focus on careers, we would have clashed, and the children and family life would have suffered.
Having it all
The women we spoke with rationalized their exit decisions by pointing to the expectations on them to prioritize family. They blamed themselves for failing to see through this supposed opportunity to “have it all”. Time and time again our societies pedal the myth that entrepreneurship is the panacea for work/life imbalance, and the secret to unlocking that much desired career goal of flexibility over one’s work. As Uma, an ex-entrepreneur, explained: I was told that would be flexible. I wanted something where I wouldn’t have to work full time, but I was completely wrong about that—especially with setting up your own business. It takes over your life and just becomes another baby. There needs to be a new conversation, recognizing business and personal expectations on female founders are often incompatible.
Business comes with costs
Policies and media should stop presenting self-employment as a cost-free solution for women. At times, it is a poor career choice, particularly when talented women could potentially be adding economic and social value in organizations with family-inclusive practices and policies that can support them. Of course, women should still be encouraged and helped if they do want to build a business. Many, particularly those with high levels of human and entrepreneurial capital, do create successful and sustainable ventures. But the evidence indicates the universal “more (startups) is better” thesis is the wrong approach. Too often advocates argue governments should focus on creating “cheaper, faster, simpler” ways to set up in business.
A more nuanced approach would benefit from firstly understanding the kinds of people who become entrepreneurs, and how peer networks and the financing environment can help. Entrepreneurship continues to be presented to women as a way to build work-life balance. But this must be balanced with a “reality check” regarding the poor prospects for those entering crowded, volatile sectors, operating part-time, or who are sole household earners without the benefit of an additional secure income.
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