By Daniela Izquierdo *
Latin America has the second highest rate of female entrepreneurship in the world, and the existence of female entrepreneurs in this region is proven to boost economic growth and create new employment opportunities.
Therefore, beyond lip service, it is essential to tackle the obstacles that hamper female entrepreneurship in Latin America. Increasing funding opportunities, raising awareness of gender-specific funding options, and vocational training programs are fundamental first steps to improve overall women’s entrepreneurship activity in Latin America.
Lack of start-up capital and access to credit are often the most significant obstacles to female entrepreneurship. Grants and other targeted funding opportunities are creative solutions used to fill funding gaps for women entrepreneurs. Examples include the FMO: Entrepreneurial Development Bank and the Inter-American Development Bank (IDB), two financial institutions that have programs to finance female entrepreneurship businesses in Latin America.
The IDB’s WeXChange program offers funding for Latin American women. Nonprofits like UN Women, Financial Alliance for Women, Start-UpChile and Empoderando Mujeres also provide funding specifically for women entrepreneurs.
Limited business expertise is another deterrent that prevents many Latin American women from starting a business. Vocational training programs that provide insight into the creation and development of new businesses can help stimulate the emergence of new women-owned businesses as well as improve productivity and technological advancement.
Additionally, to provide hands-on business training, mentoring programs that allow potential female entrepreneurs to observe successful female entrepreneurs and learn about the nuances of starting and operating a business are essential.
Patricia SÃ¡enz, managing partner and founder of EWA Capital Startups, the first private fund run by female founders in Colombia, suggests that women involved in watching startups are more likely to start their own businesses: âWe think the more we have a level C in startups … [the more likely] they will create their own businesses.
Based on the precedent set by financial institutions and nonprofits, government entities should consider establishing more accessible access to finance, either through local banks or by promoting similar programs. However, these funding opportunities must be properly advertised to ensure that the information is disseminated and that women can take advantage of it.
Government entities must renew their commitment to gender equality initiatives. Governments in Latin America including Chile, Costa Rica, Peru, Uruguay and Venezuela have all implemented programs focused on women and gender equity in the past 7 years, whose funding has ended or expired. Ensuring that these programs are renewed with a focus on access to finance and business training will be key to boosting female entrepreneurship in the region.
Promoting the growth of women-owned businesses is a surefire way to boost economic growth in Latin American markets. Policymakers and business leaders should take concrete steps to close funding gaps, raise awareness of the programs, and provide direct training to crucial women entrepreneurs in the region.
* Daniela Izquierdo is the co-founder and CEO of Foodology, a group of cloud kitchen and virtual restaurant developers based in Latam.