Scale the Gap: Exploring gender ownership and growth experiences for Canadian firms – Brookfield Institute for Innovation + Entrepreneurship
Many have studied how gender ownership and gender-based experiences affect start-ups or business more generally, but comparatively few examine the role gender plays in the process by which firms grow at a high-growth rate and achieve scale-up status. As part of the broader Women Entrepreneurship Strategy, an Innovation, Science, and Economic Development (ISED) initiative to close the gender gap in entrepreneurship, Scale the Gap focuses on filling a critical knowledge gap. A quantitative methods paper, this research compliments the qualitative work recently published, Growing their own way: High-growth women entrepreneurs in Canada.
Using a representative survey on growth experiences for small and medium firms, we examine the unique challenges women-owned firms face while growing toward scale-up status. We find that, while the gender ownership structure of firms doesn’t inherently impact the likelihood that a firm will scale, scale-ups owned by women tend to be smaller than those with higher men-ownership shares. We also find that when women-owned firms encounter indirect growth challenges — including regulatory issues and talent-related challenges — they are impacted by them differently, and are less likely to overcome these challenges.
This research will help policymakers navigate the complex gender dynamics that exist in growth entrepreneurship, and help identify points where policy interventions can create a significant impact in closing the growth gaps for women entrepreneurs in Canada.
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In particular, we focused on a subset of firms called scale-ups, or firms that rapidly grew either their employment or revenue. Specifically, we utilized the OECD-Eurostat definition of scale-ups, or firms that have achieved an average annualized growth rate of 20% or more in 3 consecutives in either employment or turnover (revenue), where such firms also employed at least 10 employees at the beginning of the growth period. Though there are other definitions of scale-up, we focused on this particular definition due both to its wide usage in conversations on scale-ups, as well as data availability.