Women more likely to take a pay cut for sake of their startup

FEMALE entrepreneurs are more likely than men to take a salary cut when starting their own business, a survey has revealed.

The study found that women are more likely than their male counterparts to sacrifice their own income for the sake of getting a new business off the ground. It suggests that women are still struggling to attract investment into their firms and feel under more pressure to reinvest as much spare income as they have into the business.

The survey, by the small business investor Iwoca, also appears to show that women are less likely than men to sacrifice their family time when starting a company, suggesting they try harder than men to juggle their time in order to share it equally between work and their partner and children.

The Daily Telegraph’s Women Mean Business campaign, launched in March 2018, called on the Government to take action to close the funding gap that prevents women from starting a business.

Iwoca’s survey of 400 entrepreneurs found that nearly half of all female business owners (46 per cent) said they sacrificed income compared with 34 per cent of their male counterparts. The results also show that while a quarter of all respondents had to sacrifice time spent with family, more men than women did so – 28 per cent, compared with 18 per cent of women.

Sharon Mcgillion, the founder of Pressie Pouch, which sells self-sealing gift wrap pouches, told Iwoca: “I’ve battled through a lot of lean winters, because I believed in myself and my products. No clothes, no fancy holidays. You put any extra funds back into your business in order to launch a product. My teenage son is my priority: if he wants he gets, and I do without.”

One reason that women are more likely to sacrifice potential income in order to reinvest into the firm appears to be the difficulty they have in attracting investment compared with men.

Following The Telegraph’s campaign, the Government commissioned an independent review into the challenges facing female entrepreneurs, led by Alison Rose, chief executive of RBS Commercial and Private Banking. Her review estimated that up to £250billion of new value could be added to the economy if women started and grew businesses at the same rate as men.