Leveraging entrepreneurship through private investments: does gender matter?

• Published in: Small business economics Vol. 40; no. 2; pp. 199 - 210
• Main Authors: Gicheva, Dora, Link, Albert N.
• Format: Journal Article
• Language: English
• Published: Boston Springer 01.02.2013; Springer US; Springer Nature B.V
• Subjects: Business and Management; Business structures; Capital investments; Economic theory; Entrepreneurs; Entrepreneurship; Financial investments; Funding; Gender; Government sponsored enterprises; Industrial Organization; Innovation; Innovations; Investment funds; Investors; Management; Microeconomics; Private investment; Sex discrimination; Small & medium sized enterprises-SME; Small business; Small businesses; Studies; Technological innovation; Technology; Venture capital; Women; Women owned businesses; United States > US; L26; Innovation; Entrepreneurship; G11; Venture capital; Gender discrimination; SBIR program; O31; J16
• ISSN: 0921-898X; 1573-0913
• DOI: 10.1007/s11187-011-9411-y

Using project data from a random sample of Phase II research awards from the National Institutes of Health SBIR program, we estimate the relative probability that woman-owned firms are able to attract private investments to fund the transition of the technology developed under the sponsorship of the SBIR program to an innovation to enter the market. We find that women-owned firms are as much as 16% points less likely to attract private investment dollars compared to male-owned firms, factors excluding the size of the SBIR award held constant. Women-owned firms that received larger awards performed substantially better. Although the SBIR program has a legislated directive to increase the participation of woman-owned firms in the program, our findings suggest that it might not be sufficient to overcome market perceptions about the profitability of such investments actually bringing a developed technology to market.