Originally posted on the MaRS blog on September 25, 2012.
If I were to tell you that a successful female business owner who grew her core business product by 200% in her first year, and whose overall business experienced growth of 136% in that first year, went to her bank for a $20,000 leaseholder loan and was told that she needed to have her husband act as a co-signer, you’d probably think this was a story from 1955. Sadly, this true tale took place less than six months ago.
As the owner-operator of the immensely successful Revel Caffè in Stratford, Ontario, Anne Campion is a visionary. She travels to the farms where her coffee beans originate to participate in the harvest. She knows not only exactly where her coffee comes from, but makes conscientious choices about her sourcing. Back at the cafè, coffee sales aside, Anne creates and hosts exceptional dinners, concerts, speaking events and art installations in a space that has quickly become a favourite of both locals and those who visit the Stratford Shakespeare Festival.
When Anne realized that she would have to expand her business to keep up with Revel Caffè’s growth and popularity, she chose an abandoned space in the heart of Stratford’s downtown that would cost her $20,000 to renovate and revitalize. What Anne wasn’t expecting was being told by the bank she had done business with for years that her husband had to co-sign her loan to make it happen. To say that she was insulted and appalled would be a gross understatement.
Perhaps not surprisingly, Anne has been called a force of nature by many who know her, and her innovative approach to funding her business shows just how appropriate that moniker is. Anne had a conversation with another force of nature in Perth County, Ruth Klahsen, the owner and lead cheesemaker of Monforte Dairy, and she decided to follow Ruth’s lead in going directly to her community for support and financing using a community-supported agriculture (CSA) model.
In 2009, with help from a team of friends and supports, Ruth put the wheels in motion to create a campaign that would allow her to open her own dairy so she could create the cheeses that she had become well known for. In 2010 her community of 899 supporters (of which I am happily one) purchased subscriptions totalling $400,400.
Opening a dairy is more complex than renovating a storefront, but Anne took Ruth’s model and created her own campaign called Community Shared Beans. Within 14 days her community responded and she surpassed her $20,000 goal.
These two entrepreneurs are examples of how women, in particular, have had to take charge of funding their businesses in their own ways—and how they’ve successfully tapped into their communities to make it happen. As successful as Anne and Ruth have been in moving their own businesses forward, I fear, with apparently good cause, that funding opportunities for women are becoming “ghettoized.”
Women-owned businesses are being forced into crowd-funding ventures either through CSA models, Kickstarter or Indiegogo campaigns or micro-financing models as seen in developing economies, mainly because their short-term financing options are not as plentiful as men-led businesses, as stated inIndustry Canada’s Women Entrepreneurs report from 2010.
There’s plenty of talk about the dearth of funding and investments by venture capitalists in Canadian startups as a whole, and this reality is even more concerning when considered through the lens of women and their opportunities for funding. American venture capitalist Cindy Padnos’ white paper, titled “High Performance Entrepreneurs: Women in High-Tech,” outlines many of the challenges that women face in funding their businesses and clearly articulates why availing women to funding is not only an imperative, but smart business.
“Today, women make up more than 30 percent of the high-tech workforce and yet they receive less than 10 percent of venture funding.”
It’s a well-known fact that small and medium-sized enterprises (SMEs) are responsible for the majority of new jobs created in our country and women-led SMEs are responsible for over $117 billion per annum in Canada. Clearly, these businesses are helping to drive our economy forward. We have a clearer picture of the economic impact of women-led businesses in the US, and we need to drive that awareness in Canada as well.
Women-owned businesses—whether potentially high-growth ones in the tech market or smaller scale businesses that are successful in their own right—need to be given more regard and more money. Full stop.
Many of us at MaRS believe that this issue is not only an important discussion on gender, but also an issue with tangible and far-reaching economic impacts. Join us in this conversation and share your stories as we work to build awareness and improve the system through an inclusive and comprehensive dialogue.