Why are women entrepreneurs seeking mentors?

• by Sonal Jaitly and Anna Roy
• Dec 6, 2023
• 3 min

India’s ranking in the Global Entrepreneurship Monitor has improved from 16th to 4th in 2023, but a gender gap persists in entrepreneurship. Women entrepreneurs need customers, networks, peers, contacts, and knowledge, and our recent research suggests that experienced mentors are often the best way to get them.

Improving the ecosystem of innovation and entrepreneurship for women and men alike is one of the central goals of public policy. India improved its ranking from 16th in 2021 to 4th in 2023, among 51 countries surveyed by the Global Entrepreneurship Monitor (GEM). This ascent reflects a steady improvement in the country’s overall entrepreneurial environment. However, a gender gap in entrepreneurship persists, as entrepreneurship is tough and it’s tougher for women. Their constraints are amplified due to entrenched gender bias in social and economic systems, which has material consequences on their entrepreneurial journey.

Entrepreneurs need much more than money, they need customers, networks, peers, contacts, and knowledge. Our recent research suggests that experienced mentors are often the best way to get almost all of these.

However, the question is how many women entrepreneurs have access to such mentors? What has been their experience of seeking entrepreneurial mentorship and how does it accelerate their entrepreneurial journey?

In a recent study done by WEP and MSC, we find that only 25% of women entrepreneurs surveyed have access to entrepreneurial mentorship, and the majority (64%) are not aware of any mentorship programs for entrepreneurs. The concept of seeking formal mentorship support for business growth still remains an alien concept, especially for women entrepreneurs in smaller towns and cities. In some Tier II cities, active local women’s industry associations are key to regular troubleshooting for women’s businesses and come closest to being institutional mentors.

Family-based mentorship for women entrepreneurs plays a key role, especially among those who run an inherited family business. 24% of women entrepreneurs mention friends and family or relatives with business experience as their mentors. Women who lead their family businesses mostly receive mentorship from male family members.

Family-owned businesses remain the dominant form of business organization in India. More than 90% of all listed firms in India are family-owned businesses, but only 12% of them have second or third-generation owners who are women. Discussions with female family business owners who are mentored by family revealed a variety of experiences, which are primarily determined by how supportive male members of the family are.

Others state that the majority of them discover mentors through their peer networks and social media.

Women’s top expectation from mentors is to connect them with industry networks.

It pays to have networks is no secret. Women traditionally have less social connections and networks outside their family circles. Access to networks also varies based on your PIN code, income, and education level. An interesting research by Harvard economist Raj Chetty and his team finds that cross-class friendships are a significant key to upward mobility in America. It is no different in India, where access to networks outside your social circles can be instrumental in providing exposure, access, and opportunities.

Our experience from the Women’s Entrepreneurship Platform (WEP) also indicates that access to industry networks is a lifeline for an entrepreneurial journey, mentors bring access to diverse networks and opportunities apart from providing valuable psychosocial support and feedback.

Women with access to high-quality mentors shared their transformational impact on both business metrics and entrepreneurial ability.  72% of women entrepreneurs report an improved ability to understand risks and opportunities in their business. 67% report enhanced confidence.

It is not surprising that mentorship is considered one of the oldest and most influential tools of human development. History is packed with stories of famous mentor-mentee relationships that have shaped human civilization. However, in the context of entrepreneurship, it’s only with the explosive growth of the Indian startup ecosystem that recognition has increased for mentorship as an effective entrepreneurship development tool. Despite this, access to quality, structured, and formal mentorship for women entrepreneurs still remains a challenge. Incubators and accelerators dominate India’s mentorship landscape however only 3% of all incubators and accelerators specifically target women entrepreneurs and remain concentrated in few regions.

As per McKinsey, an additional 55 million women could enter the workforce by 2030 if their long-standing underrepresentation is at least partially corrected. Not all will be job seekers, many will be job creators. Speeding up India’s journey to a $5 trillion economy will depend on how best we can support women’s entrepreneurial ambitions.

Along with money, markets, and skills, enabling access to high-quality mentorship will have practical implications on improving the texture of the entrepreneurial journeys of millions of budding women entrepreneurs.

The article was first published in The Hindu Business Line on 28th November 2023.