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Sarah Raine, 46, and Millena Edmonds, 39, have been running a styling and design company for the past four years. But despite winning high-profile clients that include Swarovski, Allegra Hicks, Toyota and Wedgwood, Studio Moxy has never grown bigger than its two founders.

“We’ve never said no to a job,” says Ms Raine. “But we are quite low-key. “We love the work, but talking ourselves up and selling is not our number one favourite task.”

Successive governments have launched a series of initiatives to support entrepreneurs, who are increasingly seen as crucial to driving innovation at the same time as creating jobs and wealth.

But their progress in encouraging women to set up and develop their own business has been less successful. A recent UK government investigation aimed at supporting women in enterprise — the Burt Report — found that women are a third less likely than men to start a business and that just one in five small businesses is majority-owned by women.

Shaheena Janjuha-Jivraj, an associate professor at Henley Business School, says that some women decide to start their own business as a lifestyle option in their late 30s and early 40s, perhaps to fit around children. But many then find the demands of family get in their way, cannot put in the hours needed and fail to expand the business.

“They do gain flexibility,” she says. “But the reality is that setting up a business is as demanding as having children and women often fail because they need more resources.

“Women are not as ambitious in setting targets as they could be,” she says, adding that those female entrepreneurs that have become successful often use skillsets not far removed from traditional domestic roles.

Take Kelly Hoppen, the interior designer and judge on the UK entrepreneurial TV show Dragons’ Den, Ms Janjuha-Jivraj says, or Jo Malone, founder of a perfume and candle store, or even Laura Tenison, who started the mother and baby products shop JoJo Maman Bebe.

Ms Janjuha-Jivraj cites the need for more female role models and business champions. “We need to raise aspirations,” she adds.

As an example of the dearth of successful female entrepreneurs, Ms Janjuha-Jivraj points to Dame Anita Roddick, the founder of the Body Shop, the beauty products store. Ms Roddick was the only woman to make the top 10 in last year’s Sunday Times list of the most admired business leaders in Britain, even though she died seven years ago.

Although there are no doubt several successful female entrepreneurs in engineering, science and technology, probably the only household name is Martha Lane Fox, nearly 20 years after she co-founded the online travel website lastminute.com.

Even when women do not have children, they face serious obstacles. According to the OECD, women’s companies have the same survival rate and create as many jobs as men’s do until the point that external capital is needed. Then they find they have significantly less access to finance than men.

Linda Scott, professor of entrepreneurship and innovation at Oxford university’s Saïd Business School, says that even when women are able to obtain capital, it is usually under less advantageous terms.

Women are likely to pay higher interest on bank loans, be required to provide more documentation, and be held to stricter repayment terms. Furthermore, at the point they do become successful, the business often becomes dominated by men.

“It’s not only that women have trouble accessing capital, but when they do, they often lose control to men,” Prof Scott says. “So, her growing business is now his asset. This phenomenon brings down the average size and growth rates of female-owned businesses, because the ones with promise so often pass to men.”

Although the finance industry argues the reason women find it hard to get access to capital is that they choose the “wrong” industries, she doubts this is the case.

“When you look at which sectors are ‘right’ and which are ‘wrong’, you can see that they are practically labelled ‘pink’ and ‘blue’,” she says. “Women are in retail; men are in construction. Females are in gifts; males are in automotive. Ladies are in fashion; gents dominate tech. The industries align so closely to gender stereotypes that it is hard to accept this as an objective judgment.”

Prof Scott suspects the “right” industries are all in sectors, such technology, that are “flatly hostile towards women”.

There is also a chicken-and-egg question as to whether these industries get more capital because they grow more or whether they grow more because they get more capital.

“Equally, I think it would be hard to say whether they get more capital because they are male-dominated,” says Prof Scott.

The difficulty women have obtaining finance is replicated in procurement, with fewer corporate and government contracts being awarded to women. The exception is where the organisation has created a supplier diversity programme, but these tend to be more common in the US than in Britain.

“The idea of levelling the playing field is anathema in Britain,” says Prof Scott. “People actually think you are discriminating against the men if you try to spread the business around a bit. That is such a cruel joke: the guys dominate so heavily that it would take decades, maybe 50 years, before women would approach equality.”

But women also need to gain confidence, she adds. This applies to entrepreneurs such as Ms Raine at Studio Moxy who need to get over inhibitions about self-promotion. Ms Raine agrees. “A steadier flow of regular jobs; that would be appealing,” she says.

Copyright The Financial Times Limited 2017. All rights reserved.
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