BOSTON, May 15, 2024
/PRNewswire/ -- Capstone Partners, a leading middle market
investment banking firm, released its inaugural 2024 Women
Entrepreneurs Study, which analyzes the responses of more than
200 female business owners across the U.S. for key findings related
to business decisions, growth strategies, and legacy expectations.
By comparing the survey results to Capstone's annual Middle Market
(MM) Business Owners Survey, the report seeks to identify and
elevate key differences and challenges that female founders
face.
Women entrepreneurs' current growth strategies have largely
included organic initiatives, with more than half increasing market
penetration (59%) and expanding product or service portfolios
(53.8%). Of note, market penetration tactics have been more
pertinent to women CEOs compared to the broader MM business owner
audience, of which only 47.5% have increased market
penetration.
Regarding current growth strategies, only 18.1% of women
entrepreneurs have enacted inorganic initiatives through M&A.
However, M&A as an exit strategy is likely to be more
prevalent, with 36.7% considering a merger or acquisition. This is
especially true for women CEOs aged 18-34, as many plan to
participate in multiple business ventures throughout their careers.
Among female CEOs in this age group, 48% have considered M&A as
an exit strategy compared to 33.6% of 35 to 54-year-olds and 17.9%
of 55+ year-olds. Elevated private equity interest in businesses
owned by Gen Z founders may have also contributed to 18 to
34-year-olds' M&A exit considerations. Nearly two-thirds (64%)
of women CEOs ages 18-34 have been contacted by a sponsor looking
to buy their company.
According to our results, women entrepreneurs are more prepared
for an exit than they perceive. When prompted directly, 43.3% of
female CEOs noted they have started to plan a business exit.
However, when provided a list of exit preparation steps, 74.8%
identified that they have completed at least one step. Many women
entrepreneurs have built a strong executive leadership team
(37.1%), determined financial needs (34.3%), and maximized growth
strategies (31.9%) in 2023 to prepare for a future exit.
When it came to top concerns for the future growth of their
company, inflation headlined the chart, comprising 55% of
responses. Customer retention was the next highest concern at 35%.
These figures mirrored the top two concerns in Capstone's MM
Business Owner Survey. At the same time, increased workload or
stress appeared third on female founders' list compared to seventh
for overall MM business owners. Funding for growth and credit
availability were also more heavily weighted.
Nearly one in four respondents to Capstone's WE Survey indicated
that they required help raising debt and equity capital. The
absence of growth funds allocated to female founders and the lack
of sizeable loans approved for women-owned businesses are known
hurdles for women entrepreneurs seeking to expand their business
operations. Access to early-stage, or venture capital (VC), funding
has been historically low for women, with incremental gains over
the past 15 years. In 2008, 3.4% of VC deals went to female-founded
companies compared to 6.1% in 2023, according to PitchBook. In
addition to limited deal volume for female founders, the average
deal size remains far below those awarded to male counterparts. In
2023, the average VC deal value for male-founders was $9.4 million compared to $3.1 million for female-founders.
Also included in this report:
- An overview of the current size and growth of women-owned
businesses in the U.S.
- Key findings on female executive's business operations and
strategies.
- Commentary on the challenges women face around credit
availability and fundraising.
- Commentary and Q&A from select Capstone advisors on
key service areas that women business owners identified as areas of
interest or demand.
To access to full report, click here.
ABOUT CAPSTONE PARTNERS
For over 20 years, the firm has been a trusted advisor to
leading middle market companies, offering a fully integrated range
of investment banking and financial advisory services uniquely
tailored to help owners, investors, and creditors through each
stage of the company's lifecycle. Capstone's services
include M&A advisory, debt and equity placement, corporate
restructuring, special situations, valuation and fairness opinions
and financial advisory services. Headquartered in Boston, the firm has 175+ professionals in
multiple offices across the U.S. With 12 dedicated industry
groups, Capstone delivers sector-specific expertise through large,
cross-functional teams. Capstone is a subsidiary of
Huntington Bancshares Incorporated (NASDAQ:HBAN). For more
information, visit www.capstonepartners.com.
For More Information Contact:
Sarah Doherty
Director of Market Intelligence
sdoherty@capstonepartners.com
617-619-3310
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SOURCE Capstone Partners