Why are there fewer young women in entrepreneurship than young men?

In 2021, around 41% of businesses created in France were created by women and only 14% of women were business owners. These figures are on the rise, but the progress is still rather slow.

And yet, young women and men now have the opportunity to learn about entrepreneurship during their studies. The proportion of student companies created by female entrepreneurs is now 39% according to Pépite France. These young women are determined to succeed, and are calling on the higher education community to provide better support.

In order to observe and analyse entrepreneurship by women, the Observatory of Gendered Perceptions of Entrepreneurship (Orelig) was launched on 8 March 2020 by the National Foundation for Business Management Education and Pépite France. Its aim is to respond to two main objectives: to better understand the motivations of young women and the obstacles they face in creating or taking over an organisation and to promote the implementation of actions to promote entrepreneurship among women.

The Observatory brings together a team of eight researchers from various backgrounds (public and Catholic universities, business schools). It is the first French initiative of its type. The issue of gender has not been systematically addressed in management science in France.

The French lagging behind

There are more than fifty highly reputable journals on gender and economics in the world. They are supported by strong collectives, such as the Women’s Business Council established in the UK in 2013, which publishes an annual report on businesses owned and run by women.

French academic rankings show only two, including the leading journal Feminist Economics, which is not well regarded for its alternative approaches to orthodox economic theories. Orelig therefore offers a gender-focused perspective of entrepreneurship by young women in France. These surveys and analyses will be carried out annually, based on a particular theme or focus of general interest and expressed by the respondents.

An initial study was carried out in the first quarter of 2021 in 29 Student Centres for Innovation, Transfer and Entrepreneurship (the “Pépites”, launched by the Ministry for Higher Education, Research and Innovation in 2014 (there are 33 across France), among its population of female student entrepreneurs. The analysis involved crossing quantitative and qualitative data.

Of the 245 valid responses, Generation Z (young women under 26) made up the majority (78.8%). Three quarters of these student entrepreneurs had already had professional experience through internships or significant experience in non-profit organisations.

An appetite for Independence and freedom

93.1% of the students surveyed said that they had registered with Pépite in order to set up their company, association or organisation. However, commitment to an entrepreneurial project was not the only reason given by the respondents. For 27.8% of them, the purpose of the business start-up scheme is professional development. It enables them to acquire skills that will be useful even if they do not start a business.

For more than 80% of the respondents, entrepreneurship allows for personal and professional fulfilment. This quest takes shape through three major dimensions: fulfilment through writing your own life story, beyond the simple act of taking part; fulfilment through creating a business that meets a need for others; fulfilment through making innovations or a contribution that can change society.

One woman expressed this search for fulfilment in the following way:

“What motivates me is to be able to do something that satisfies me, makes me proud and allows me to be fully independent.”

This is not a way to get around the difficulties encountered in the labour market. Nor are they aiming for wealth or a form of elitism. Only 20% of the students linked entrepreneurship to social prestige and for 30% of them it was a way to create their own job and earn money. In fact, these student entrepreneurs see entrepreneurship as a way to gain independence and real freedom. It is both a means and an end, as they do not envisage a return to the workforce.

More than half of the respondents associate entrepreneurship with working without a supervisor and the vast majority of them link it to the possibility of organising their own time. This is their vision of work, both as a commitment in terms of value but also as self-fulfilment through creation and their own creativity. One entrepreneur listed the facets of her entrepreneurial vision:

“Creating my own company means meeting a need, creating delight, choosing my profession, putting my skills at the service of the environment, being independent, being happy to get up in the morning, choosing my hours, choosing my partners, working in harmony with my vision, my ethics and my desires.”

A world “full of sharks”

However, when they talk about the entrepreneurial journey, young women report the difficulties that lie ahead with fresh lucidity. They list the problems of legitimacy, fundraising and credibility specific to their gender. For 57.1% of the respondents, most institutional contacts (financial sponsors, banks, suppliers, partners) are suspicious when a woman presents a business creation project. One woman explained:

“I would like one day for society to be able to consciously and unconsciously consider the fact that a woman is as credible as a man... Unfortunately, this is still far from the truth.”

A strong awareness of these obstacles does not stop them, however. They are determined to become entrepreneurs. One student entrepreneur said:

“You have to believe in what you are doing and go for it! Don't worry about others, life is full of sharks, it won't do us any favours, so it's up to us to turn things around and work for our future.”

To ensure the success of their project, they get training, seek mentors and advice and, like their elders, want to reassure themselves of their capacity to become entrepreneurs. One respondent summarised her perception of the situation as follows:

“Whether you are a man or a woman, even if some doors are closed, you just need to surround yourself with good, caring people and everything will be fine; each person will learn the necessary skills when the time comes or can rely on a team.”

Based on these initial results, Orelig has suggested areas for reflection and action to promote entrepreneurship among young women in France. The aim is to analyse gender and generational effects on the perception of entrepreneurship and also to better understand the role of “Pépites” in supporting and defining the perception of entrepreneurship by student entrepreneurs.

The longevity of the Observatory and the dialogue it will have with other research in France are two of the concerns of its members. Other initiatives have been launched over the last 20 years and it is clear that it is not easy to maintain them over the long term, given the many challenges involved.