The Next Wave: Financing Women's Growth-Oriented Firms

Stanford University Press

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Library of Congress Cataloging-in-Publication Data

Names: Coleman, Susan, 1951– author. | Robb, Alicia M., author.

Title: The next wave : financing women’s growth-oriented firms / Susan Coleman and Alicia M. Robb.

Description: Stanford, California : Stanford Economics and Finance, an imprint of Stanford University Press, 2016. | Includes bibliographical references and index.

Identifiers: LCCN 2016014110 (print) | LCCN 2016014373 (ebook) | ISBN 9780804790413 (cloth : alk. paper) | ISBN 9781503600003 (pbk. : alk. paper) | ISBN 9781503600980 (electronic)

Subjects: LCSH: Women-owned business enterprises—United States—Finance. | Women-owned business enterprises—United States—Management. | Success in business—United States.

Classification: LCC HG4061 .C638 2016 (print) | LCC HG4061 (ebook) | DDC 658.15/224082—dc23

LC record available at http://lccn.loc.gov/2016014110

Typeset by Bruce Lundquist in 10/14 Minion

THE NEXT WAVE

Financing Women’s Growth-Oriented Firms

SUSAN COLEMAN and ALICIA M. ROBB

STANFORD ECONOMICS AND FINANCE

An Imprint of Stanford University Press

Stanford, California

To my husband, Bill, with grateful thanks for your love, encouragement, and support—Susan Coleman

To my good friend, Paula Kantor, who dedicated her life to women’s empowerment. She was killed by the Taliban in Afghanistan on May 13, 2015—Alicia Robb

CONTENTS

Preface and Acknowledgments

1. Introduction: Why Growth?

2. A Status Report on Growth-Oriented Women Entrepreneurs

3. What We Know About the Challenges for Growth-Oriented Women

4. A Star Is Born! Financing Strategies for Nascent Entrepreneurs

5. First Things First: Financing Strategies for Early Stage Firms

6. The White Knuckle Flight: Survival Stage Strategies for Growth-Oriented Firms, Part I

7. Brave New World: Survival Stage Strategies for Growth-Oriented Firms, Part II

8. Crowdfunding: The New Kid on the Block

9. Liftoff! Financing Strategies for Scaling Up and Managing Rapid Growth

10. Going for Gold: Harvesting Value

11. No Rest: Life After Harvesting Value

12. Let the Circle Be Unbroken: Women Investors

Appendix: Resources

Notes

Interviews

References

Index

PREFACE AND ACKNOWLEDGMENTS

One of our greatest frustrations in writing our first book, A Rising Tide: Financing Strategies for Women-Owned Firms, was the limited amount of time and space that we could devote to growth-oriented firms. In light of that, we are delighted that Stanford University Press has given us the opportunity to expand upon our earlier work and devote an entire book to the topic of financing strategies for growth-oriented women entrepreneurs. In this book, The Next Wave: Financing Women’s Growth-Oriented Firms, we follow the journey of high-growth entrepreneurs from their firms’ earliest stages through to maturity, harvest, and even beyond.

The most recent U.S. Census data reveal that there are nearly ten million women-owned firms in the United States (2012 Survey of Business Owners). Although the majority of these firms are small, a growing cohort of women is launching firms with significant growth potential. Their motives for doing so are as diverse as the firms themselves. Some of these growth-oriented entrepreneurs are motivated by a desire to pursue an opportunity or an unmet need in the marketplace. Others are frustrated by the constraints imposed by a glass ceiling that prevents them from reaching the most senior ranks of corporations. Still others are drawn by the financial and economic rewards that can come from leading a firm that achieves scale. Whatever their motivations, data reveal that an increasing number of women are choosing entrepreneurship as a career path, and of those, a growing number of them share aspirations for growth.

In The Next Wave we focus on the financial strategies employed by growth-oriented women entrepreneurs. As we will show, these are more varied and complex than the strategies used by lifestyle entrepreneurs. Firms that grow typically require larger amounts of financial capital, and both prior research and anecdotal data reveal that women often encounter a variety of barriers in their attempts to secure financing at all stages of their firms’ development. Some of these barriers are structural in nature, while others are social and cultural. In light of that, our goal has been to recognize the barriers but also to highlight the financial strategies that have worked and can work for growth-oriented women entrepreneurs.

In addition to delivering a contemporary account of financing strategies from the growth-oriented entrepreneur’s perspective, The Next Wave also addresses investor perspectives on financing. To date, most books on growth-oriented entrepreneurship have focused on the entrepreneur’s challenges and strategies, but have ignored the investor side of the equation. This approach tells only half of the story. Since growth-oriented firms often require substantial amounts of both external debt and equity, the investor perspective is critical. We address this gap by detailing the development of a new generation of women investors—women who have risen through the corporate or professional ranks or have launched their own successful firms and have thus acquired significant funds to reinvest in the entrepreneurial firms of others. These women are in a unique position to serve as investors for a new generation of entrepreneurs. We envision this as a type of virtuous circle whereby women entrepreneurs make the transition from being recipients of human, social, and financial capital to being providers of those key resource inputs to the next generation of growth-oriented women entrepreneurs.

The Next Wave combines research findings from our own scholarly work using the Kauffman Firm Survey with that of other highly regarded researchers in the United States and abroad. In addition, we provide interviews with real-world growth-oriented women entrepreneurs in a broad range of industries to illustrate how our entrepreneurs actually apply the principles and practices of finance. Our interviews with these amazing entrepreneurs are what give The Next Wave its spark, because we had the opportunity to share in the passion, successes, frustrations, and failures of women who aspire to growth.

In addition, consistent with our desire to strengthen the link between women as entrepreneurs and women as investors, we provide insights from angel investors and venture capitalists, who are an important part of the next wave of growth-oriented women’s entrepreneurship.

Writing The Next Wave has been a labor of love for both of us, and we have many people to thank for the successful completion of this book. We would first like to thank the wonderful women entrepreneurs and investors who have taken the time to share their experience, insights, and wisdom with us. The Next Wave could not have been written without them. We would also like to thank the Ewing Marion Kauffman Foundation for providing access to the Kauffman Firm Survey, which provides data on a cohort of over four thousand U.S. firms launched in 2004 and tracked over an eight-year period. We have used these invaluable data as the basis for much of our analytical work. We wish to note, however, that although we have used the KFS data to produce research findings for this book, the opinions and recommendations expressed are our own and not necessarily those of the Kauffman Foundation.

We would like to thank the Kauffman Foundation yet again for the generous financial support that has allowed us to write The Next Wave and to attend key conferences where we developed and tested our ideas. We would also like to thank the University of Hartford’s Barney School of Business for a summer research grant to support the development of early drafts of The Next Wave. The Barney School also provided graduate assistant support that allowed us to gather prior research and data. In particular, graduate assistants Ece Karhan, Mert Karhan, and Isha Sen have played an invaluable role in the book’s development. We would like to thank the University of Hartford’s Women’s Education and Leadership Fund for a grant that helped support the development of case studies on our women entrepreneurs.

We have been doubly blessed in our publisher, Stanford University Press, which also published our first book, A Rising Tide: Financing Strategies for Women-Owned Firms. We are deeply appreciative for SUP’s recognition of the need for a second book to delve more deeply into the phenomenon of growth-oriented women’s entrepreneurship. Many thanks to our wonderful editor, Margo Beth Fleming, who has provided guidance and constant encouragement. Similarly, we are grateful for the work of our editorial assistant, James Holt, who so ably shepherded The Next Wave through the production process. We would like to take this opportunity to recognize and thank our two reviewers, Babson College’s Victoria Sassine and Julie Weeks, president and CEO of Womenable. Their thorough reviews and detailed comments were instrumental in helping us expand and improve upon earlier versions of this book.

Last but not least, we would like to thank our families and friends for their support, love, and patience through this process. In particular, Susan thanks her husband, Bill Coleman, for his enduring love, encouragement, and support, as well as her sister, Maureen Distasio, her brother, David Flint, and David’s partner, Becky Wilson, for being the best sisters and brother anyone could ever ask for. She would also like to thank her nephews, Mick and Lou Distasio, her grandson, Ben Coleman, and her University of Hartford students for their unfailing belief that she can do anything she puts her mind to. Alicia would like to thank all the amazing women in her life who continually support and inspire her, including her mother, Jackie, her aunts, Barbara and Brenda, her niece, Maria, her cousins, Samantha and Sabrina, her friends Jeanne Lavin, Erin Pinto, and Krista Katsantonis, as well as as the many women who agreed to share their stories, their expertise, and their advice that we highlight in this book. Alicia would also like to thank her colleagues and friends at the Kauffman Foundation, especially E. J. Reedy, Dane Stangler, Mette Kramer, Michelle St. Claire, Barbara Pruitt, Arnobio Morelix, Amisha Miller, Alex Krause, and Kauffman’s CEO, Wendy Guillies. She thanks her partner, Mark Patrick, for his love and support. Finally, in the last year of this project, Alicia lost a good friend, Paula Kantor, to whom she dedicated this book, who was killed in Kabul by the Taliban. Paula was a passionate advocate for women and dedicated her life to empowering women around the world. We hope that we can continue to do our small part in continuing Paula’s work. She will not be forgotten.

1

INTRODUCTION

Why Growth?

My own butt was the inspiration for all of this, said Sara Blakely, founder of Spanx, an entrepreneurial firm in the shapewear industry with an estimated market value of $1 billion (Wolfe, 2013). Sara is both a surprised and a surprising role model for growth-oriented women entrepreneurs. As the daughter of an attorney, she attended Florida State University with the goal of becoming a lawyer like her father. Low scores on the LSAT derailed her plan, however, and she ended up selling fax machines. Long hours on the road gave her time to fantasize about creating a product that she could sell and others would be willing to buy. Consistent with her vision, she founded Spanx at the age of twenty-seven. Originally, Spanx produced a lower body shaper for women that filled the gap between the girdles of yesteryear and the much more sheer women’s underwear of today. The product’s appeal is that it allows women to feel more confident by smoothing out bulges and bumps, while remaining relatively comfortable. Endorsements from Oprah Winfrey helped launch Spanx in 2000, and the following year, Sara started selling her products on QVC, the home shopping channel. Spanx were and continue to be sold in department stores where Sara has marketed the product using before and after photos of her derriere. After the success of her initial product line, Sara branched out into additional offerings including denim leggings, swimwear, workout clothing, and men’s Spanx. In 2013, Sara was the first woman to join Bill Gates and Warren Buffett’s Giving Pledge by agreeing to donate over half of her wealth to charity. Today, Sara remains the sole owner of Spanx, which had sales of almost $700 million in 2013.

We could not resist Sara Blakely’s story as a way to launch our own entrepreneurial venture, a book that focuses on the financing strategies of growth-oriented, women-owned firms. Sara is part of a new and growing vanguard of women who are taking the plunge and growing their firms to achieve significant size and scope. For these women, the sky’s the limit, and they are paving the way for those who follow. Although today only a small percentage of women own firms with revenues in excess of $1 million, entrepreneurs like Sara Blakely are breaking new ground, developing market-driven products and services, and designing strategies to achieve success on their own terms. This book is a celebration of their accomplishments, as well as an examination of the financial strategies that have helped them succeed.

Before we delve into the details, however, let’s start with some preliminary questions: Why growth? Why women entrepreneurs? Why now? Traditionally, women-owned firms in the United States have been small. Even today, the vast majority of women-owned firms have no employees aside from the entrepreneur herself (2012 Survey of Business Owners). Similarly, women-owned firms have been small in terms of revenues. Thus, women-owned enterprises have typically been low-growth or no-growth lifestyle firms, often home-based and concentrated in service and retail sectors. A primary motivation for women entrepreneurs like these has been the desire to supplement family income in ways that allow them to be at home with children while they are young. We featured one such entrepreneur, Debbie Gadowsky, the founder of Cookies Direct, in our first book, A Rising Tide: Financing Strategies for Women-Owned Firms (Coleman and Robb, 2012). Debbie initially launched her firm at home with the goal of helping to finance college educations for her two children. She has done that and more, and now ships cookie baskets all over the world, achieving revenues of $500,000 per year while still operating out of her home.

More recently, however, a new cohort of women entrepreneurs has emerged. Unlike Debbie, who launched with the specific goal of establishing a relatively small and manageable home-based firm, these women start their firms with the intent to achieve significant size and scale. In this sense, they are a new breed that has emerged from the economic, social, and cultural characteristics of our time. Sara Blakely typifies entrepreneurs of this type in that she is young, well educated, creative, and visionary. She is also motivated not only by the innovative nature of her products but also by the economic rewards that they provide to her as an entrepreneur. Further, she values recognition as well as the opportunity to make an impact at a national or even international level. As a way to begin answering our questions Why growth? Why women? and Why now? let’s examine the factors that have made Sara Blakely as well as other growth-oriented women entrepreneurs like her.

Economic Impacts of Growth-Oriented Entrepreneurship

Every year, thousands of firms are launched, and simultaneously thousands of standing firms die or cease to exist through a variety of means. This pattern illustrates economist and political scientist Joseph Schumpeter’s theme of creative destruction, which is at the heart of the entrepreneurial process (Schumpeter, 1934). In the United States, the vast majority of firms are young and small. Some of these firms will grow into large enterprises, but most of those that manage to survive the first few years will remain small. The U.S. Small Business Administration defines a small business as a firm having five hundred or fewer employees, and 99 percent of all firms in this country fall into that category. In fact, most of these firms are very small, with ten or fewer employees and annual revenues of $100,000 or less (Lowrey, 2011). Nevertheless, the firms that we continually hear about in the business press are the big ones.

Why are we so focused on this small percentage of very large firms? Our preoccupation with growth-oriented firms can be explained by two major considerations: their ability to contribute to economic growth and their potential for creating a significant number of new jobs (Haltiwanger, Miranda, and Jarmin, 2013; Audretsch, 2007; Wennekers and Thurik, 1999). Prior research reveals that young, growth-oriented entrepreneurial ventures disproportionately create jobs in the United States (Haltiwanger, Hyatt, McEntarfer, and Soufa, 2012; Haltiwanger, Jarmin, and Miranda, 2010). While firms under ten years of age only account for about 25 percent of overall employment, they account for about 40 percent of job creation (Figure 1.1).

FIGURE 1.1. Share of Employment and Job Creation by Firm Age

Source: Kauffman Foundation BDS Statistics Briefing (Haltiwanger and others, 2012)

The job creation potential of new growth-oriented firms is particularly important now. Although the United States has emerged from a global financial crisis and the worst recession in eighty years, the job market continues to pose challenges. The current national unemployment rate is 5.5 percent (U.S. Bureau of Labor Statistics, 2015a). However, this national percentage masks the stark nature of the job market for some segments of the population. As examples, the unemployment rate for young people, those in the twenty-to-twenty-four-year age range, is 10.6 percent, and for those in the eighteen-to-nineteen-year age range it’s 16.8 percent (U.S. Bureau of Labor Statistics, 2015b). For black and Hispanic young adults, the rate is even higher. This age range is the point at which young adults typically launch their careers, get married, buy cars and houses, and start families. Their inability to find jobs postpones that entire process and reduces the likelihood of positive outcomes.

These factors help us in answering the questions Why growth? and Why now? However, our third question, Why women?, remains. Several scholars have pointed out that women entrepreneurs represent an economic resource that has yet to be fully tapped. Although women represent roughly 50 percent of the population, they represent only about one-third of entrepreneurs (Minnitti, 2010; 2012 Survey of Business Owners). The gender gap in growth-oriented entrepreneurship is even wider. A recent report from the Kauffman Foundation points out,

With nearly half of the workforce and more than half of our college students now being women, their lag in building high-growth firms has become a major economic deficit. The nation has fewer jobs—and less strength in emerging industries—than it could if women’s entrepreneurship were on a par with men’s. Women capable of starting growth companies may well be our greatest under-utilized economic resource. (Mitchell, 2011, p. 2)

In spite of this persistent gap between men and women in the level of growth-oriented entrepreneurship, a number of factors are contributing to positive change. Some of these factors represent changing trends in education, society, and culture, while others represent motivational drivers that are prompting more women to take the plunge. Taken together, these various factors have contributed to a changing entrepreneurial landscape and a blurring of many boundaries that have traditionally separated the types of firms that women launch from those launched by men. Let’s take a few moments to review some of these changes.

Educational, Social, and Cultural Factors

Today’s women entrepreneurs are better educated, better trained, and better prepared than ever before. From the standpoint of education, the number of women graduating from college actually exceeds the number of men. Although men are still more likely to have graduate degrees, women are gaining rapidly. Thanks to initiatives at the local, state, and federal levels, women are also diversifying their fields of study to encompass previously male-dominated disciplines such as science, technology, engineering, and math (STEM) (Landivar, 2013). These academic disciplines are important because they often serve as a gateway for entry into fields such as health care, information technology, and manufacturing, all of which are fertile ground for innovation and entrepreneurship. Continued progress in this area will help to break down the industry segregation that has constrained women to service and retail fields, which are highly competitive, less growth-oriented, and less profitable (Hudson, 2006; Wang, 2013).

In addition to these educational gains and the new opportunities they unlock for women entrepreneurs, a major social and cultural change has been the number of women who work outside of the home. Working women are not necessarily a new phenomenon, but a growing number of these women are now holding positions of influence and power in both large and small corporations (2012 Catalyst Census). These positions help women develop skills in a broad range of areas, including the ability to manage others, the ability to make important and often difficult decisions, and the ability to see the big picture. Taken together, these educational and workplace changes have helped to equip a growing number of women with the human capital required to launch growth-oriented firms.

In spite of these changes, however, women still face challenges in corporate environments. Although women are now well represented in middle management positions, few have reached the executive suite or board of directors level (Ding, Murray, and Stuart, 2013; Nelson and Levesque, 2007). Studies conducted by Catalyst, an organization devoted to expanding opportunities for women, found that women held only 4.2 percent of the CEO positions in Fortune 500 firms in 2012. Similarly, women held only 16.6 percent of the board seats for these firms (Missing Pieces, 2013). In a study on the development of high potentials capable of serving on boards for both public and private companies, the authors noted that

men are more likely than women to have career experiences managing people, being responsible for profit functions, and attaining executive status in their current jobs. (Carter and others, 2013, p. 6)

A number of the women entrepreneurs we have spoken with allude to the glass ceiling, which prevented them from advancing to the most senior ranks of their former firms—creating an impetus to start their own. From a public policy perspective, one of our challenges going forward is to ensure that women have advancement opportunities in their firms and organizations. As in the case of educational and experiential gains, these types of leadership opportunities will help to equip them with the skills needed to launch growth-oriented firms.

Financial Rewards as a Motivator: Oprah Winfrey

In addition to basic advancement, an important motivator for growth-oriented entrepreneurs, both male and female, is the potential for significant financial and economic gains. Consider the case of Oprah Winfrey, who is not only a highly successful growth-oriented entrepreneur, but also one of the wealthiest individuals in the United States.

Oprah Winfrey was born to a teenage single mother in rural Mississippi. Raised in an inner city neighborhood in Milwaukee, Winfrey was sexually abused by family members and friends of her mother as a child. She became pregnant at the age of fourteen, and gave birth to a son who later died. Oprah subsequently moved to Nashville, Tennessee, to live with her father. While there, she enrolled in Tennessee State University and began working in local radio and TV in 1971. After graduating from college, Winfrey embarked on her broadcasting career in earnest, hosting her first television chat show in 1976. This led to the launch of the now famous Oprah Winfrey Show as a nationally syndicated program in 1986. Winfrey launched her own production company, Harpo (Oprah spelled backward) to house the show, which became increasingly popular and increasingly profitable. Her show focused on issues and topics that resonate with women, highlighting both the joys and challenges of everyday life. Simultaneously, she addressed difficult topics such as sexual abuse, sexual preference, substance abuse, and marital fidelity. When the trend toward trashy talk shows emerged in the 1990s, Winfrey bucked it and signaled her respect for her audience by avoiding tawdry topics. In contrast, she focused increasingly on topics relating to self-improvement, strategies for overcoming adversity, and spirituality.

Winfrey went on to launch additional entrepreneurial initiatives, including Oprah’s Book Club, O: the Oprah Magazine, Oxygen Media, and the Oprah Winfrey Network. As a role model and thought leader, Oprah has inspired many women to take control of their destinies by getting out of bad relationships, taking charge of their emotional and physical well-being, and improving their lives. For almost three decades, she has served as an enduring example of courage, dignity, common sense, and spunk. In 2013, Oprah Winfrey had a net worth of $2.9 billion and held the distinction of being America’s only African-American billionaire. In addition to the many accolades and awards that she has received in her field, including numerous Emmys and a Lifetime Achievement Award by the National Academy of Television Arts and Sciences, Winfrey has been recognized as a member of the Forbes 400, a listing of the four hundred wealthiest individuals in the United States (http://www.forbes.com). In 2013, Forbes also recognized Winfrey as number 13 on its list of the world’s most powerful women.¹ While women like Oprah show the earning potential of a high-growth women entrepreneur, traditionally, women’s earnings have lagged those of men. This persists even today.

Recent data from the U.S. Bureau of Labor Statistics indicate that full-time women workers’ earnings are only about 81 percent of that of their male counterparts. The pay gap is even greater for African-American and Latina women, with African-American women earning 64 cents and Latina women earning 56 cents for every dollar earned by a Caucasian man (U.S. Bureau of Labor Statistics, 2013). A number of reasons have been put forth for this discrepancy, including the fact that women are more likely to have career interruptions associated with the birth of children or their subsequent care in the home. Further, as noted above, many women have gravitated to fields that simply do not pay as well as others, such as teaching, nursing, and clerical work versus manufacturing, computer science, and engineering. These boundaries are shifting, however, as more women assume the role of primary wage earner for their families. A record 40 percent of all households with children under the age of eighteen include mothers who are either the sole or primary source of income for the family, according to a new Pew Research Center analysis of data from the U.S. Census Bureau. The share was just 11 percent in 1960² (Wang, Parker, and Taylor, 2013). Similarly, women are now well represented in a number of previously male-dominated fields such as medicine, accounting, and law. These factors have raised women’s aspirations and expectations for higher earnings and opportunities for career advancement.

Being Recognized as a Leader

Another motivator for growth-oriented women entrepreneurs is the opportunity for recognition as a leader in their field at either a national or even an international level. Beyond the firm, leadership roles allow women to shape the direction of their industries and provide input on key issues such as legislation, regulations, and public policy, all of which will have an impact on them. Like well-known male entrepreneurs such as Bill Gates or Steve Jobs, women entrepreneurs want to be recognized as movers and shakers. They want to be taken seriously, and they believe they have earned that right. This is a motivator that surfaced in our first book, A Rising Tide, as several of the women entrepreneurs that we interviewed spoke of their desire to reach their full potential and to be respected, valued, and looked up to for their accomplishments. They wanted to validate their own capabilities and talent through their entrepreneurial ventures, but they wanted external validation as well.

These themes are especially prominent in women entrepreneurs who aspire to growth. Kiran Mazumdar-Shaw established her biotech firm, Biogen, in Bangalore, India, in 1978, operating out of her garage and starting with the equivalent of approximately $200 in funding (Anderson, 2012). In 2004, Biogen went public with a market value of over $1 billion and now operates on a global scale. One of Mazumdar-Shaw’s goals has been to make health care more affordable and more accessible, particularly for the poor. In a 2012 interview with CNN she stated,

India is a country where 80% of healthcare is out of pocket; where 80% of healthcare infrastructure is in the private sector; where most people don’t have access to quality healthcare (Anderson, 2012).

In the face of these grim statistics, Mazumdar-Shaw resolved to be an agent of change by using technology to bring down the cost of developing new drugs. She has earned global acclaim and was recognized as a Technology Pioneer by the World Economic Forum. She has also received national awards presented by the president of India for her pioneering work in the field of biotechnology. (http://www.biocon.com)

Making an Impact

Each of the growth-oriented women entrepreneurs we have referenced—Sara Blakely, Oprah Winfrey, and Kiran Mazumdar-Shaw—has sought ways to have an impact beyond the boundaries of her company. Each of our entrepreneurs has used her wealth and influence to address issues and causes on a larger scale. As noted, Sara Blakely has made a commitment to donate half of her wealth to charity. Her efforts to date have been focused on initiatives that help women and girls. One such project was the Empowerment Plan, a Detroit-based program that works to create jobs for homeless women (Spanx Mogul Sara Blakely Becomes First Female Billionaire to Join Gates-Buffett Giving Pledge, 2013). Her pledge letter states,

Since I was a little girl I have always known I would help women. In my wildest dreams I never thought I would have started with their butts. As it turns out, that was a great place to start! At Spanx we say it’s our goal to make the world a better place, one butt at a time. With this pledge my goal is to make the world a better place . . . one woman at a time. (http://www.givingpledge.org)

Oprah Winfrey has provided generous financial support to a broad range of individuals and causes. One of the initiatives that has been most important to her is the Leadership Academy for Girls located in South Africa, which Winfrey established in 2002 and has been funding ever since (The Education of Oprah Winfrey, 2012). Beyond that, her visibility as a celebrity has enabled her to take positions of social and political issues. As an example, in the 2008 presidential campaign Winfrey was an outspoken supporter of then little-known candidate Barack Obama. Her support is credited with persuading roughly one million voters to support Obama in a race that led to the election of America’s first black president. (McClatchy, 2007)

In addition to her desire to lower the costs associated with developing new drugs, Kiran Mazumdar-Shaw wanted to start a firm that would help to arrest the brain drain of bright young scientists from India to other nations. Today her firm employs almost five thousand scientists, including a significant number of women who were previously sidelined and bypassed for the most desirable jobs in science and technology fields (Anderson, 2012). These examples highlight our belief that growth-oriented women often have societal goals and aspirations driving their choices. The fact that they have been so successful in launching and growing their firms provides them with a platform for addressing other issues and causes for which they have a passion.

Growth-Oriented Women Entrepreneurs as Role Models

Women entrepreneurs who have successfully grown their firms can also have an impact by serving as role models and mentors for other women contemplating entrepreneurship or attempting to launch their businesses. This is particularly important given the continuing gap between the numbers of women- and men-owned firms. This gap is even more pronounced for growth-oriented firms. Women such as Sara Blakely, Oprah Winfrey, and Kiran Mazumdar-Shaw serve as an inspiration for the thousands of women who dream of following in their footsteps. Each of these remarkable women has also taken it upon herself to help other women and girls reach their educational, career, or entrepreneurial goals. In A Rising Tide one of our key strategies for women entrepreneurs was to pay it forward (Coleman and Robb, 2012, p. 244). We advised aspiring women entrepreneurs to get mentors, and we urged successful women entrepreneurs to be mentors. These measures are all a part of the rising tide of women’s entrepreneurship that we addressed in that book. In order for women entrepreneurs to succeed, they have to help and support each other. In other words, women’s entrepreneurship is not a zero sum game in which some women can succeed only if others fail. In contrast, entrepreneurship is a big boat, and there is plenty of room for more talented, energetic, and determined women like those we have described in this chapter. In The Next Wave, we will highlight the importance and impact of successful women entrepreneurs on the launch and development of other growth-oriented women-owned ventures.

Growth-Oriented Women Entrepreneurs as Investors

One of the newest and most exciting ways in which successful