Women run 29% of UK small businesses. As with most small businesses, many of these female-led businesses do not successfully scale. Why?

There are, broadly speaking, three different types of entrepreneurs:

• Those who want the benefits of self-employment

• Those who started their business to capitalise on a particular skill or idea

• Those who set out to grow and exit a business

Many women fall into one of the first two types. They have a skill or idea and want to earn some money doing it while having the flexibility and tax benefits of self-employment. Many women prefer the work-life balance that self-employment offers as well as being able to manage work alongside other commitments, such as childcare.

It's the last of these entrepreneurs who tend to scale because they start with the end in mind. Their aim is to grow, so that's what directs their business decisions. Starting with a long-term exit in mind, entrepreneurs can identify ways to scale from the outset. They can keep costs low, minimise debt, scale the business, develop a name for themselves, and then sell up for a decent sum of money. Then they can choose to retire early, or use the profit as seed money for their next venture, or perhaps invest in other entrepreneurial women and help them grow and exit.

Many entrepreneurs who do plan on scaling and selling their businesses often get stuck focusing on the minutiae of day-to-day operations. Try not to be a chronic perfectionist, wanting everything to be just right; trust other people to get the details right.

How can we support more women scaling and selling their businesses?

What we need are more real-life role models for women to look up to and emulate. Women who share their success stories without shying away from sharing the challenges they faced and strategies they employed. With more inspiration, we can cultivate more belief in women that they will be successful business leaders, helping embed that important mindset from the very foundation of their business.

And a good coach or mentor can provide inspiration and encouragement as well as hold your long-term plans to account, helping you to maintain that essential long-term view.

Advice for entrepreneurs (of any gender) tends to focus on starting up a business and getting it investment-ready. Of course, this advice can work, but it drowns out other considerations and ways of growing organically.

There needs to be more conversations about how to grow a business, especially without seeking investment. Seeking investment from the outset focuses the mind on chasing potential investors rather than trying to grow a loyal customer base and a good product offering.

It is often far better to keep costs down, bootstrap your initial product range, grow your customer base, develop products in line with feedback, and progress from there. Then, if you decide to seek investment, you will have a far more attractive proposition. This way, you can continue to grow organically, keeping more of the business for yourself.

Growth mindset

The most important thing to help you scale and sell your business is a growth mindset. And one of the most effective ways of changing your mindset is to imagine what your business will look like in three years, five years, ten years. Where will it be without you? Does it work as a scalable business, and if so, what needs to happen to get there?

Try and look at it from all angles. What would you be doing? Who else would you need to hire? Perhaps even work back from your target turnover to figure out how many sales you need. How can that be achieved in a realistic timeline?

Simply by asking and exploring these questions, you begin to take on a growth mindset and also begin to set realistic goals, helping make the process feel more achievable. You can also begin to think of who might make a good mentor or who has succeeded in a similar field that you could emulate to help inspire yourself, grow your confidence, and build on great ideas. The more women who successfully scale and ultimately exit their business, the more role models we'll have and a less lonely place it will be – a win-win for every woman in business.

By Fiona Hudson-Kelly, author of ‘Grow and Sell your Startup'

ABOUT THE AUTHOR

Fiona Hudson-Kelly has built two businesses and sold them for life-altering amounts of money. In her new book, ‘Grow and Sell your Start-up; How to create a business you can sell for Millions' Fiona explains how she did it, and how you can too. www.FionaHudsonKelly.com

References:

Rose Review of Female Entrepreneurship, HM Treasury 2019

Simply Business Research, 3 Mar 2022