The Center for Women's Business Research:
Knowledge That Means Business and Opens Doors for Women

By Sarah Priestman

"Women-owned businesses employ more people than the Fortune 500,” trumpeted the first major press release from the Center for Women’s Business Research in 1992. It was the sound bite heard around the world, and it resulted in headlines across the United States, Germany , China , Japan , and many other European and South American countries. Thus began a 16-year journey to transform the perception of women-owned businesses from small, economically insignificant hobbies, into the reality of substantial, growing contributors to the U.S. economy.

Just three years prior to that release, the Center for Women’s Business Research, founded as the National Foundation for Women Business Owners (NFWBO), was created by a group of women entrepreneurs who were frustrated by the common belief that women ran very trivial businesses.

These women knew that they and many others were running sizeable, emerging businesses. They realized that if women-owned businesses were to be taken seriously, there needed to be the same kind of serious data about women’s entrepreneurship that existed for other segments of the economy. The result was a new non-profit research institute dedicated to producing the intelligence that would unleash the economic and social impact of women’s entrepreneurship.

The organization’s beginnings were humble — its first “office” tucked away in a corner of founder Gillian Rudd’s office suite, with a desk, but no chair, and a computer, but no printer. Rudd was a visionary whose charisma and ideals brought together women and men entrepreneurs and leading corporate executives to pursue a mission to change the world for women’s entrepreneurship.

Rudd, a former national president of the National Association of Women Business Owners (NAWBO), brought together a group of NAWBO leaders to form the Center. The new organization had its own bylaws, board of directors, and budget, as well as a mission that was consistent with NAWBO’s vision; many of its leaders came from NAWBO leadership.

The Center’s first study — Women-Owned Businesses: The New Economic Force — forever changed the perception of women-owned businesses and put the organization on the map.

Working with the help of David Birch at Cognetics, Inc., the Center expanded the definition of a woman-owned business to include full corporations, as well as the sole proprietorships, partnerships, and Subchapter S corporations that already were included in the U.S. Census. The goal in doing so was to capture the full impact of women on business ownership and on the economy. Today, the U.S. Census Bureau has expanded its data to include full corporations.

“We felt the definitions commonly used at that time understated the impact of women-owned businesses and limited women’s access to credit,” remembers founding Center Board member Laura Henderson , who is the founder and CEO of a $17 million health research and communications company. “The definition also helped to maintain age-old barriers for women-owned businesses into public and private markets, and undermined efforts to create the legislative policies needed to expand economic opportunities.”

From the start, the Center recognized that having the best research in the world would not make a difference unless the relevance and implications were broadly communicated. So, with the help of volunteer and professional public relations experts, that first report garnered headlines in every major media outlet, including a segment on “Good Morning America” featuring Henderson and Sharon Hadary , executive director of the Center.

“When we got off the air,” Hadary remembers, “I called the office, and they said we were inundated with calls to buy the report. How much were we charging? Well, we had never thought about that — so we decided to charge $29.99. Although we thought this was an outrageous price for the publication, we figured it was easier to discount than to increase the price. We sold out!”

The Momentum Continues

Henderson recalls a conversation she had after presenting the research at a U.S. Treasury Department bankers’ conference not long thereafter. She received a call from an attendee who assumed the numbers he’d jotted down during her speech were incorrect. When she assured him that his figures were accurate, he paused and said, “Do you understand that this data is going to change the way my bank loans money?”

“We started the Center to open people’s eyes to the real contribution and potential of women-owned firms,” Henderson recalls. “His call convinced me that we were on the right path.”

“Decisions are driven by hard data,” says Hadary, who joined the Center at its inception in 1989 on an interim basis after a successful career at IBM. Hadary points to the book The Little Engine That Could when describing the early days of the organization.

Like the engine, and like many women getting a start-up off and running, Hadary, Rudd and Henderson soon found they had entered new and uncharted terrain. Like many new business owners, these women were fueled by their commitment. They believed that opportunities for women would expand if they could use research to demonstrate the economic viability and strength of women-owned businesses when trying to gain access to technical expertise, capital, and markets.

Early on, there were a small number of forward-thinking corporate executives who saw the potential of women-owned businesses as a market and brought their corporations to the table with contributions and expertise. AT&T and IBM were the Center’s first two corporate partners, and today, these two firms are still are premier corporate partners of the Center. The Center’s current corporate partner list includes the nation’s most prestigious corporations.

The Center has benefited from a dedicated group of leading women business owners who have generously contributed not only their dollars, but also their expertise, their contacts, and their companies’ resources.

Just a list of the chairs of the Center’s Board of Directors reads like a “Who’s Who” in women’s entrepreneurship. (See accompanying sidebar.) Laura Henderson’s contributions are of particular note — in the early years, her financial contributions to the Center exceeded those of any of the corporate partners.

The Center now is guided by a 22-member Board of Directors, which is composed primarily of business owners and advocates for women’s entrepreneurship. (See accompanying sidebar.) In addition, it benefits from an Advisory Council that consists of leading business women and men who give of their time and share their visions, voices and resources.

Knowledge That Means Business

Since 1992, the Center has used its research to create the environment in which women worldwide can fulfill their entrepreneurial dreams.

The Center’s signature report — its biennial update on women’s entrepreneurship — includes the numbers, employment, revenues, industry distribution, and growth rates for the nation, all 50 states, and the top 50 metropolitan areas. These reports build on U.S. Census data. The seventh update, in 2004, was the first report expanded to include estimates of spending by women-owned businesses in key areas such as compensation and benefits, information technology, human resources, shipping, and telecommunications.

For more than a decade, the Center has been one of the only organizations to consistently track access to capital for women business owners. Ten years ago, tracking access to capital meant simply focusing on banking relationships and credit. Nowadays, the Center is also studying access to equity for women business owners — reflecting the maturation of women’s entrepreneurship in just that short period.

The Center also generates data and trends on businesses owned by women of color, based upon U.S. Census figures. As part of its signature bien nia l updates, the Center includes a special report on the numbers, growth and employment of businesses owned by women of color, segmented by ethnicity. Additionally, the Center has studied the accomplishments and challenges of women business owners of color, comparing and contrasting women entrepreneurs of all ethnicities.

Also included in the Center’s rich body of research studies are comparisons of women and men business owners' leadership and decision-making styles, uses of technology and capital, benefits offered, philanthropic activity, and access to markets.

Recent research focuses on growth and the characteristics of the women business owners whose businesses have achieved high and fast growth, as a role model for women who strive for these same goals.

Disseminating the Message

The Center’s research findings are disseminated directly to policymakers, financial institutions, corporate decision-makers, women’s business advocates and nonprofits, educators, and most importantly, to women business owners through research alerts, press releases, and newsletters.

All research projects also include a comprehensive public relations plan for outreach to the media, to build support and awareness of women business owners. In 2005 alone, the Center’s myth-busting research has been featured in reports by hundreds of media outlets, including The New York Times, USA Today, Chicago Tribune,The Wall Street Journal, Associated Press, Redbook magazine, Worth magazine, Fast Company magazine, and “The NBC Nightly News.”

Research in Action

Why is it important — even now, almost 20 years after the Center’s first report — to continually get the word out?

Although research has helped to fuel the tremendous strides that have been made in women’s entrepreneurship, barriers to markets and capital still remain. The Center’s tagline, Knowledge that Means Business, captures the essence of its work — the Center’s research means business for women entrepreneurs, for corporations, and for this nation’s economy — and through the insightful, timely data it publishes about women-owned firms, the Center helps all women unleash their full economic potential and power. Through these data and statistics, women entrepreneurs are able to reinforce their quests to obtain capital and enter markets — meaning business for banks and corporations, as well.

The Center has provided the incentive for many public and private sector programs, including loan funds targeted to women entrepreneurs, the Small Business Administration’s women business center program, and Springboard Enterprises, which has helped women open the door to venture capital.

“I use the Center’s research to get any new project off the ground, and in everything I do,” says Amy Millman, president of Springboard Enterprises.

The research also is utilized by individuals who are meeting with lenders or other potential supporters.

Nina McLemore, a Center board member, founder of Liz Claiborne Accessories, and currently president of Nina McLemore, LLC, credits theCenter’s data with paving the way, in part, for her successes.

“I learned early on that no matter how enthusiastically I spoke about my merchandise and business ideas to potential lenders, light bulbs did not go off until I talked about numbers and data,” she explains. “The information from the Center was critical to getting the ball rolling.”

The Center’s research has provided the rationale for national, regional and community banks’ business plans to specifically serve women entrepreneurs. Advocates for women and business rely on the data, as well.

Susan Bari , president of the Women’s Business Enterprise National Council (WBENC); Leslie Grossman , president of Women’s Leadership Exchange (WLE); and Erin Fuller of NAWBO all say they use the Center’s studies and findings to leverage support for projects that expand economic opportunities for women.

The Center has, indeed, come a long way from its start 16 years ago, when it was staffed by a part-time executive director and two interns. Today, it boasts a staff of 12 (including four professionals whose time is fully devoted to research and four professionals whose skills are devoted to communications), and has its own office in a Washington, DC building on K Street. Unlike in the beginning, every Center computer today even has a dedicated printer.

Data That Can Make the Difference

It all sounds impressive. But, how many women business owners are aware of the role the Center plays in the big picture of business opportunities?

“Sometimes I think we are the best-kept secret in the world,” Hadary says. “[That’s] ironic, since our work touches the lives of businesswomen everyday.”

As of 2005, women entrepreneurs can strengthen their own business plans with Center data, including the following facts:

• Women own 50 percent or more of 10.6 million privately held firms in the United States. That represents nearly half (48 percent) of all such firms.
  
• One in 11 U.S. women is an entrepreneur.
  
• One in seven U.S. workers is employed by a woman-owned business.

Similarly, advocates for women can use the following figures:

• Most financially successful women-owned businesses in the United States are less likely than their men-owned counterparts to use either credit or equity.
  
• Women-owned businesses in the United States are getting an average of 4 percent of corporate dollars spent on outside goods and services.

Looking Toward the Future

“Data not only tells us the way things are,” says Marjorie Alfus, chair of the Center’s Board of Directors, “it also portends the way things will be.”

“The indirect result of growth may be greater capability and interest in policymaking and politics,” she says. “Also consider the trend toward increased levels of financial sophistication, and the willingness — if not the demand — for a broad use of equity and debt strategies for women business owners to grow their businesses.”

This is a far cry from the Center’s early focus when it first opened its doors. Then, the goal was to document the numbers and earnings of women business owners and to begin to track trends in their continuing growth. Now, the Center’s research delves beyond the questions of “how many” and “how much.” Today’s studies reflect the maturity of the women business owner sector by exploring expansion, transition and succession, as well as entrepreneurial retirement.

“We ask questions that go a little deeper these days,” Hadary explains.

“Our research stresses that women are operating firms of all sizes, including million-dollar firms, and these companies are growing,” McLemore adds.

We all have seen changes since 1992. For many women, the biggest change has been the success of their businesses. While many acknowledge that the tipping point for realizing a business dream was a critical loan or line of credit, a corporate or government contract, or business skills training, few may have known that this support was available in large part due to the data supplied by the Center for Women’s Business Research. The Center will continue to open doors for women by providing leading edge, in-depth research and knowledge in the years ahead.

SARAH PRIESTMAN is a freelance writer based in Washington , DC. For more information about the Center for Women’s Business Research, phone 202-638-3060, e-mail info@womensbusinessresearch.org, or visit www.womensbusinessresearch.org.

(This article is reprinted from the Summer 2005 edition of Enterprising Women magazine. Copyright 2005, Enterprising Women Inc.  Reproduction in whole or part is prohibited, except by express permission of the publisher.)