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The Experts

Fi Bendall
+ About Fi Bendall

Fi Bendall is chief executive of The Bendalls Group and a Westpac/AFR 2015 100 Women of Influence, who was described by CEO Magazine as 'The CEO's Secret Weapon'. An expert and pioneer in digital strategy, she has over 23 years’ experience in the digital and tech sectors.

Trust and the influencer bubble

Monday, June 17, 2019

Influencer marketing is big business, but are brands thinking things through when they hand over their valuable reputation to ‘influencers’ with high follower counts but low credibility?

A recent University of Glasgow study assessing the nutrition and diet information provided by key UK social media influencers suggests people turning to influencers for advice and guidance should do so with a healthy dose of scepticism.

The findings, presented at this year's European Congress on Obesity, reveal just one out of the nine most popular UK health and wellness bloggers studied met the criteria for transparency, evidence-based references, trustworthiness and adherence to nutritional guidance, and bias.

“We found the majority of the blogs could not be considered credible sources of weight management information, as they often presented opinion as fact and failed to meet UK nutritional criteria,” says the study's first author, Christina Sabbagh. “This is potentially harmful, as these blogs reach such a wide audience.”

Of course, Belle Gibson is one of the most publicised examples of an influencer deceiving their followers and trashing the valuable currency of trust. Gibson’s Instagram fame rested specifically on the claim she had devised a diet that had cured her of terminal cancer. Her ruse was exposed in 2015 when it was revealed she did not have any form of cancer. Gibson had no educational background or qualifications relevant to the areas in which she was giving advice. She faced the Federal Court in 2017 and was ordered to pay a fine of $410,000 after being found guilty of misleading and deceptive conduct.

Influencer marketing has been with us in some form or another going back to the rise of the celebrity sales pitches of the 1950s and 1960s on TV and radio. In the digital age, with the proliferation of online platforms and channels and its myriad forms of celebrity, from the Kardashians through to social media stars who have made their name in niche areas, the numbers of so-called influencers has exploded.

Apparent influencers are everywhere. The problem is that these people are generally really only as influential as they say they are. Rubbery social media metrics such as follower counts and likes are difficult to trace and verify. Thousands of followers does not necessarily equate to any kind of authentic engagement or real influence on the behaviour of consumers. This is often where desperate brands fall foul of the influencer bubble. They too often mistake vanity metrics for trust, authenticity and actual influence, and consequently end up seeing their marketing spend on influencers disappear into the digital ether.

That’s not the worst result though. Even worse for brands is they open themselves up to the potential of being aligned with someone who spreads false or even dangerous information, as in the case of Belle Gibson.

With something like health advice, it’s not just about being misled about buying a product like a TV or something, which is bad enough, it’s about people potentially putting their health at risk because of something someone told them on YouTube.

Our research at The Female Social Network indicates only 6% of the population is effective in changing someone else’s opinion, in having influence, and it’s certainly not always the person with the biggest follower count. It’s important not to confuse social media vanity metrics with credibility, which is why we actively seek out women who are smart, trustworthy and credible to work with our clients as effective opinion leaders.

Companies madly scrambling to reach and connect with consumers have turned to influencers as the answer to their digital engagement problems. However, as the University of Glasgow study, Belle Gibson and countless other cases have shown, without proper due diligence, they risk tarnishing their brand and eroding the trust they should be looking at building between themselves and their consumers.

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Which country has the highest proportion of female entrepreneurs?

Tuesday, June 11, 2019

The answer to which country has the highest proportion of women-owned businesses might come as a surprise. No, it’s not any of the progressive Scandinavian countries. It’s not the very forward-thinking Canadians, nor is it the UK, Australia, US or New Zealand. Must be Germany or The Netherlands, I hear you say. Wrong again.

The country with the highest proportion of female business owners is the West African country of Ghana, with women owning 46.4% of all businesses, according to the Mastercard Index of Women’s Entrepreneurship (MIWE) released last year. The next two on the list might surprise you too, with women owning 35% of all businesses in Russia, while the figure is 34% in Uganda.

The MIWE report found that New Zealand is the best country overall for female entrepreneurs and women business owners. New Zealand achieved its top ranking because of its high scores in the areas of supporting entrepreneurial conditions, knowledge assets and financial access, and women’s advancement outcomes.

So why exactly is there such a high rate of business ownership among women in Ghana? The answer is intriguing.

In the report, Ghana is described as “uniquely placed”. Many of the factors that contribute to the overall conditions for female entrepreneurship are classified by the report as either “poor” or even “very poor”; this includes such as factors as ease of doing business, quality of governance, support for SMEs, and education levels. These factors place Ghana on an equivalent level to countries like Malaysia, Romania, Russia, Brazil and Argentina in the overall MIWE index rankings.

However, Ghana’s women manage to overcome these factors and demonstrate an extremely high drive to become business owners. Part of this can be explained by ‘need-based’ entrepreneurship, which basically means that women in Ghana have very few options other than to start their own small business as a way of supporting themselves and their families.

As the report outlines: “Given that the country is a lower-middle income and factor-driven market, women typically turn to necessity-driven entrepreneurial activities out of sheer will to survive and to support oneself and family.”

Many of Ghana’s female entrepreneurs are agricultural or food-based operators: “The vital role that women play as farm owners, farm partners and farm laborers is astounding: their contribution is estimated to account for around 70% to 80% of food consumed in the country. They have also become increasingly responsible for the education and other material needs of their wards, especially in female-headed households.”

The entrepreneurial drive of Ghana’s women is truly unique, outstripping the other African countries included in the survey, as well as most other countries with higher levels of overall support and income levels around the world.

Women in Ghana do it tough, as the report notes: “It is ironic to note that although Ghana (one of the 3 newly added markets) has the highest women business ownership (46.4%), women entrepreneurs are not as well-received by society as men despite them being the sole breadwinners and backbone in their families most of the time.”

It’s incredible to think what an amazing source of talent Ghana possesses in its women entrepreneurs. Imagine if these women could be properly supported to achieve their dreams and use all of their drive to enrich themselves, their families, and their compatriots?

At the moment, most women’s businesses in Ghana struggle to move beyond the micro level, in part because of common factors like lack of finance, which affects women-owned businesses all over the world. Backing Ghana’s women in business could have a very real and lasting positive effect in growing the country’s economy and improving the overall wealth and wellness of its people. In fact, the same could be said the world over.

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What’s emotional labour and should men do more of it?

Monday, June 03, 2019

Call it emotional, mental or invisible labour, it’s basically all of the work women, and it’s mostly women, do outside of their job or career to organise a household and run a family. It’s the neverending and always growing inventory of lists and tasks women carry in their heads to keep the show going – because the show must always go on.

As the author Gemma Hartley wrote in her Harper’s Bazaar article ‘Women aren’t nags; we’re just fed up’: 

Emotional labor, as I define it, is emotion management and life management combined. It is the unpaid, invisible work we do to keep those around us comfortable and happy. It envelops many other terms associated with the type of care-based labor I described in my article: emotion work, the mental load, mental burden, domestic management, clerical labor, invisible labor.

It’s not only about who does the dishes or who mows the lawn, or any of the other household chores domestic partners often bicker about. It’s about the heavy mental load mostly shouldered by women in thinking about children’s vaccinations or aged care arrangements for an elderly parent. In thinking about setting up play dates and talking to kinder teachers about behavioural changes in your child. Or staying awake late at night thinking through the minutiae of organising the next family get-together that’s coming up on the weekend.

It’s keeping all the plates spinning in the air at once and making sure the plates are clean and we’ve pre-ordered spare plates, because accidents always happen. And someone’s going to have to clean up that mess, aren’t they?

It’s all the stuff women have almost always done, mostly without any real gratitude or thanks. Which is OK, sort of. But not really.

Women are still doing all of this stuff, but now we’ve got careers and businesses to think about too. We’ve got mortgages and financial security to consider. We want nice things for our kids. Maybe even a few little things for ourselves along the way. We want family. We want career. Perhaps the men in our lives could help that happen? 

But it feels like we’re carrying a lot of this on our backs alone. Women have entered the workforce, but in so many ways, we’re still waiting for men to enter the household. Cooking every now and again is nice. Doing the gardening is good. But too many men still seem to ghost through the grind. Present in body, absent in mind.

Not all, of course. But it does sometimes feel like men cherry-pick the tasks and chores they don’t mind doing, while women take on pretty much everything else that’s leftover.

Do men need to do their fair share of this work? Would it actually help men better understand their partners and bond more with their children if they did? Would a more evenly shared domestic and mental labor load help both men and women at work and at home? Might we even find a deeper harmony and understanding in sharing this work?

The world has changed a lot in the past 30 years. Women have moved with the times. Certainly, in some ways, so have men. But just as men and women have learnt to work together and appreciate each other in the workplace, maybe we can start to do the same at home. It’s sad, but I’ve known men who feel like they don’t really know their wives or children. Hard-working, professionally successful men. Even when they’re at home, they never really feel like part of the furniture.

Men could start to talk to the women in their lives about all of that invisible work, about the mental load. The braver ones could even start to take on some of the load. They could learn about all the bits and pieces, cogs and levers, that keep a household running. In doing so, they could ease the burden on the women in their lives. They could even find a new kind of meaning and connection in their lives too.

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What’s your business plan for blockchain?

Monday, May 27, 2019

When a new and potentially transformative technology comes into view, it will commonly divide observers into three broad camps: ardent believers, dismissive non-believers, and the wait-and-sees. One of the most famous examples of this is of course the information superhighway, or as we refer to it now, the internet.

Back in the innocent, early days of the internet, as hard as it is to believe, many people thought the internet would at best become something like a global electronic bulletin board for academic papers. Aside from a visionary few, not many saw its commercial or even cultural potential.

Arguably the most cited example of the non-believer perspective is a semi-famous article from 1995 by an academic named Clifford Stoll. To be fair, Mr Stoll was not totally dismissive of the internet, but he did display a now-unfortunate degree of cynicism about just what the internet could become:

Visionaries see a future of telecommuting workers, interactive libraries and multimedia classrooms. They speak of electronic town meetings and virtual communities. Commerce and business will shift from offices and malls to networks and modems. And the freedom of digital networks will make government more democratic.

Baloney. Do our computer pundits lack all common sense? The truth in no online database will replace your daily newspaper, no CD-ROM can take the place of a competent teacher and no computer network will change the way government works.

Today, we see similar screeds about other new technologies, especially blockchain, which has become maybe best known as the underlying technology for cryptocurrencies like bitcoin.

As with the internet, blockchain has its boosters, naysayers and neutrals. It is at a relatively early stage of development and most people are still getting their heads around what it actually is, let alone what it could become in 5, 10, or 25 years’ time.

But many more entrepreneurs, startups, big companies, and even governments are seeing the massive potential of blockchain beyond bitcoin, cryptocurrencies and even banking and finance. Just as the internet moved beyond its initial adoptee community of academics, cyber pioneers and computer enthusiasts, blockchain is emerging from the shadow of bitcoin.

Just in the past couple of months, these organisations have been testing ways to incorporate blockchain into their operations and value chain:

● The Bank of Canada and the Monetary Authority of Singapore successfully completed a digital currency swap using blockchain.

● PepsiCo’s pilot project incorporating blockchain into its digital advertising yielded a 28% improvement in advertising efficiency.

● Amazon Web Services has made its Amazon Managed Blockchain generally available, allowing businesses to connect AWS accounts as nodes in their own blockchain network, with Amazon overseeing the management and maintainenance of the overall network.

The sober perspective on all of this is encapsulated by this quote from experienced tech venture capitalist Todd Hixon:

The bottom line for entrepreneurs: don’t expect Blockchain to change the world anytime soon. Blockchain architecture faces an uphill battle in many large-scale applications. Major near-term impact will be limited to a few markets with lower transactions volumes and higher importance for security and direct end-user control of personal data: medical and personal financial records are possibilities. Much of the currently-vigorous activity in the Blockchain world is option-buying or pure speculation.

As with any new wave of technology, there will be winners and losers. There will be those who brave the risks and go all in on blockchain, only to find they’ve backed the wrong horse, while others will seemingly stumble into good fortune.

But it’s vital for any entrepreneur or business to be thinking about the possible scenarios and at the very least investigating the ways in which your business could utilise or benefit from blockchain. So what camp does your business fall into? Believer, non-believer, or wait-and-see?

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We need 21st Century thinking for childcare

Thursday, May 23, 2019

Regardless of who is in power, childcare is one of the biggest policy challenges facing the government. It’s a complex area with lots of moving parts and numerous stakeholders. It’s also an emotive area because it involves the care of our children and has a massive impact on the finances of so many Australian families. Successive governments have tinkered with it to varying degrees of success and failure.

Most parents will tell you that childcare, despite the rebates and government subsidies, is still an onerous financial burden. For many women (and it’s mostly women), being able to access childcare means they can return to work but will come out financially only marginally better off than they would have been staying at home. 

For others, it’s just not worth it. These are the women who drop out of the workforce entirely, leave careers, and end up paying the ‘motherhood penalty’. They fall behind in lifetime earnings, retire with less super, and often find it extremely difficult to return to the workforce at anywhere near the level they were at upon leaving to have a child.

Of course, parents are crying out for affordable childcare. But they also want quality. At the moment, most parents would tell you they are happy with the quality of the care, but at what financial cost?

Does the government drop regulatory requirements and open the industry up to more competition, putting the big operators on notice, or does it continue to pump subsidies in the vain hope of keeping prices for parents down?

Or does the government need to find a disruptive solution that manages to tick all the boxes for children, parents, childcare centre operators and childcare workers?

The depth of feeling on this issue has been palpable during the federal election campaign. In parent and community groups on social media, opinions and views have run hot. One of Australia’s best-known ‘mummy bloggers’ Adele Barbaro catalysed much of this passion in one of her Facebook posts:

The discussion thread that followed her post was packed with parents sharing their experiences and talking about the choices they’ve had to make. It’s hard to summarise or pick out specific comments because they each tell their own story, but the overwhelming sense is that many parents feel they are being gouged by the operators, who seem to up fees when subsidies to them are increased. There was also almost universal respect from the parents who posted for the childcare workers and educators looking after their children, with the general consensus that these people were still not being paid enough for the great work they do.

Beyond the immediate and important concerns of cost and quality, it’s also essential to consider the long term ramifications of childcare as an educational service that is preparing our children for schooling and, indeed, life. Children absorb so much in those formative early years. There is a strong social and economic argument to be made that quality, affordable childcare lays the foundations for future academic success as well as socialisation.

In addition to this childcare enables women to either return to their careers in a full-time or substantive part-time capacity, which means businesses don’t lose these talented women from their ranks, and these women can continue to develop their careers. That’s a massive win for women as well as the economy.

Other countries are grappling with childcare too. In many ways the US is even further behind than Australia, the UK and Western Europe. As columnist Matt O’Brien writes in the Washington Post, “At this point, it seems pretty clear that our 20th-century institutions are failing our 21st-century seems like the fact that our educational system wasn’t set up with dual-earning households in mind is a big part of the problem.”

Like the US, policy discussions in Australia on childcare still seem to be stuck in a 20th Century mindset. We’ve seen so many industries overturned by new ideas and disruptive thinking, why not childcare? What can the government learn from the innovations in platform business models that have occurred in areas like transportation (Uber), accommodation (Airbnb), and entertainment (Netflix, Spotify)? Can any of these lessons be applied to the childcare industry?

At the moment, the main thrust of the debate about how childcare provision can be improved runs along the old regulate vs deregulate axis. This is largely what came out of the Productivity Commission’s Childcare and Early Childhood Learning inquiry from 2014. But are we missing something in this puzzle? Do we need a more radical approach to fix this problem? What would a truly customer-centric approach to childcare yield?

There are definitely worse places to start than by listening to what consumers want from a service. Maybe the best thing the federal government can do about childcare is to listen to the likes of childcare consumers like Adele Barbaro and other mums and work from there.

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Election 2019: What’s in it for female entrepreneurs?

Monday, May 13, 2019

Unfortunately, there has not been a lot during this election campaign from either of the big parties addressing the main problems facing female entrepreneurs. However, on the bright side, there are positive signs that issues like better and more affordable childcare and tax breaks for small businesses are on the agenda at this federal election. If you take the time to look at the policies, there’s worthwhile offerings from both sides.

But is there much for women in business?

Having combed through the policies published by both the major parties on their websites, the only reference I could readily find to female entrepreneurs or women in business was in the Liberals’ Small Business pledge: “The Morrison Government is determined to increase the number of female business leaders.” 

Somewhat ironically, the party itself seems to have trouble increasing its number of female political leaders.

The policy continues concerning the LNP government’s ongoing commitment to “supporting 55,000 young women to become entrepreneurs through the Future Female Entrepreneurs Program” and the Boosting Female Founders fund, which “provides access to early stage capital and entrepreneurial support to launch businesses of high-growth potential.”

The Coalition government has done a poor job of selling itself to female voters. While a number of the women in the LNP cabinet have worked diligently and productively in their respective portfolios, they’ve been badly let down by people in the party who are having trouble dragging their knuckles into the 21st century.

The Liberals’ ‘women problem’ (should really be considered a man problem…) has badly tainted its brand in the eyes of female voters. Losing both Julie Bishop and Kelly O’Dwyer, among other female MPs, has led to even more scrutiny about the Morrison government’s commitment to women within its ranks, as well as its engagement and understanding of women out in the electorate. 

That’s not a good sign considering the basic fact that a little more than half of the voters are women. Obviously, that’s not the only consideration women will take into the ballot box, but it will sway more than a few, and if the result is close, that could make all the difference.

Labor has certainly made itself a far more attractive option for many women, sheerly because as an organisation it has received and read the memo that women want to see more women in leadership positions.

At a time when women are flexing their muscles and demanding a fairer deal, that will put the ALP in a very strong position. Even women with a preference for the Coalition government’s economic policies and track record might well be thinking that maybe a few years in opposition would force the LNP to rethink its approach to attracting women to the party and keeping them. 

I could find no mention of women in the ALP’s small business policy, though it did feature a photo of a woman as its main image, which is better than nothing I guess.

To Labor’s credit, they have a strong policy directed at closing the gender pay gap. Among the raft of actions they plan to undertake is to “enforce gender-equitable government procurement processes.”

There is no more detail on this aspect of the policy, but it is an area that has received a fair amount of attention in the past few years from public policy wonks and women’s business advocates. Opening further access to government contracts for women-owned businesses would be a big win for women, but of course, the devil is in the details, which we don’t get at this stage.

(For an in-depth dive into ‘gender smart’ procurement policies relating to the Australian context, have a look at ‘Australia Case Study: Can Smart Design of Government Procurement ‘Buy’ Increased Women’s Workforce Participation?’ by Australian trade diplomat Louise McSorley in the ‘Gender-smart Procurement Policies for Driving Change’ paper published by Chatham House.)

The ALP also has an extensive list of promises attached to its National Strategy for Gender Equality. Again, the policy rhetoric hammers at the Achilles’ heel of the Liberals, which has been their failure to elevate and nurture female leaders: “Women’s representation and equality just isn’t a priority for the Liberals. After six years in power, the Liberals have taken no serious action on gender equity and they never will.”

This is a pity for the LNP government because it contains men and women who have done good work in advancing the cause especially of women in business. In truth, I think the LNP has missed a real opportunity at this election to double down on its work in developing initiatives to help Australia’s female entrepreneurs and business owners.

The recent Rose Review into female entrepreneurship in the UK highlighted several excellent policies and initiatives carried out by Australian governments in advancing women’s businesses. The review also showed that the UK is starting to take women in business seriously, with the UK government exploring ways it can create a better environment for female entrepreneurship. 

So many Australian women are now starting or running businesses. Some are doing it so they can have better work/life balance and flexibility, others because corporate Australia does not recognise their talents and skills, and still others because they want to create a better life for themselves and those around them. They all have the dream of running a successful business. This should have been manna from heaven for the Liberals, a home run in the making.

As it is, instead of bolstering the good work they have done with an even more comprehensive package directed at the more than half a million women business owners (504,838 according to the 2016 census data), they’re struggling to make their message heard because of a party culture that mostly excludes and alienates women.

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Does Australia need a co-ordinated female entrepreneurship policy?

Monday, May 06, 2019

With Brexit hogging the headlines and taking up almost all the political oxygen in the UK now for nearly three years, it might be hard to believe much else is getting any attention.

However, last year the UK Treasury commissioned the Deputy CEO of NatWest Holdings and CEO of the Royal Bank of Scotland’s Corporate, Commercial & Private Banking business, Alison Rose, to lead an independent review of female entrepreneurship, The Alison Rose Review of Female Entrepreneurship.

The resulting report was recently released, along with the government’s response, and many of its findings and recommendations could easily be applied to the Australian context. Would it be valuable and prudent for the next Australian government to commission its own review looking into how better to support female entrepreneurs?

The Rose Review findings shone a light on the fact the UK has fallen behind other developed countries in encouraging female entrepreneurship, especially in comparison to best practice peer countries such the USA, the Netherlands, Canada and, indeed, Australia.

As the review states: “In 2017, only 5.6% of UK women run their own businesses, compared to 15% of women in Canada, almost 11% of women in the US, and over 9% of women in Australia and the Netherlands… This puts the UK in the bottom quartile for female entrepreneurial activity compared to these best practice peer countries with similar characteristics.”

The UK’s also-ran status is a problem because the review also made clear the potential benefit to the UK economy that could come from improving the business ecosystem for women: “Up to £250 billion of new value could be added to the UK economy if women started and scaled new businesses at the same rate as UK men. Even if the UK were to achieve the same average share of women entrepreneurs as best-in-class peer countries, this would add £200 billion of new value to the UK economy.”

While the argument for gender parity is of merit in itself, for the more economically hard-headed among us, there is also a lot of sense in empowering women to do well in business. With the rising economic might of China, India and others, the old guard of developed nations needs to be thinking about empowering all of their citizens to become more productive if they are to remain competitive in the global economy. One way to to do that is to tap into the latent entrepreneurial talent of women.

The review focused on three critical areas of "opportunity" for remedying the UK's laggard status on female entrepreneurship and helping women in business:

  • Increasing the funding directed towards them;
  • Greater family care support; and,
  • Making entrepreneurship more accessible for women and increasing support locally, through relatable and accessible mentors and networks.

All three are common sense areas that come up time and again in the literature on female entrepreneurship, as well as anecdotally when talking to women in business. In addressing these areas, the review put forward eight recommendations, or initiatives, “which can be taken forward immediately by the private sector, though all would benefit from public sector support.”

These initiatives are to:

  1. Promote greater transparency in UK funding allocation through a new Investing in Female Entrepreneurs Code
  2. Launch new investment vehicles to increase funding going to female entrepreneurs
  3. Encourage UK based institutional and private investors to further support and invest in female entrepreneurs
  4. Review existing and create new banking products aimed at entrepreneurs with family care responsibilities
  5. Improve access to expertise by expanding the entrepreneur and banker in residence programmes
  6. Expand existing mentorship and networking opportunities
  7. Accelerate development and roll-out of entrepreneurship-related courses to schools and colleges
  8. Create an entrepreneur digital first-stop shop

The government’s response to the review has been positive, with the Exchequer Secretary to the Treasury, Robert Jenrick, expressing a desire for the UK to catch up to its counterparts internationally.

“I want to see the UK matching, and then surpassing, some of the best-performing countries for entrepreneurial gender parity, such as France, Canada and the US. This requires a 50% increase in the number of female entrepreneurs or an additional 600,000 female businesswomen, and will take persistent efforts from the private and public sector,” he said.

The UK is playing catch up. The Rose Review and the government's response acknowledge the systemic issues holding back women entrepreneurs. As the review points out, more needs to be done.

From an Australian perspective, it's encouraging that the review cites Australia as an example of one of the countries leading the way for women-owned and led businesses. Several Australian government policies and programmes are mentioned, including many that have benefitted the SME sector more broadly, as well as women.

These policies have helped foster women's business activities in Australia, but we are in danger of hitting a plateau where female entrepreneurs keep banging their heads against the same walls of poor access to capital, networks and information. It might be time for the Australian government to commission its own Rose Review, one which looks specifically at what can be done to overcome these systemic problems.

There's no doubt the Australian federal government, and some of the states, have done many good things in this area up until now. But a comprehensive review would allow us to take stock and develop policies and plans that would ensure Australia stays among the best practice nations for female entrepreneurship, and truly activates and empowers women to make an even more significant contribution to the economy in years to come.

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Gender lens investing sharpens the focus on women’s businesses

Monday, April 29, 2019

The digital investment platform Ellevest, launched two years ago, announced a $33 million funding round at the end of March. The round was led by Rethink Impact and PSP Growth, and included some very high-profile names as co-investors, including Pivotal Ventures, the investment and incubation company founded by Melinda Gates; PayPal; Elaine Wynn, co-founder of Wynn Resorts; and Eric Schmidt, former executive chairman of Google and Alphabet; and Mastercard among others. 

Led by Sallie Krawcheck, Ellevest is a US-based fintech company created to help women achieve their financial potential through modern, low-cost investing. Its primary focus is on tapping into a large number of women who are looking for a low-cost way to start investing their money.

A former Wall Street banker, Krawcheck started Ellevest because she was shocked by the number of women who were not preparing themselves properly for retirement.

As she told The Sydney Morning Herald in an interview last year, “Society tells us that money is a man's thing.”

“At school, research shows boys get better grades in maths for the same answers. In magazines, there are 16 different ways to have a smoky eye but when it comes to money it's either not there or we are infantilised. It's ‘Are you a Samantha or a Carrie with money?’”

“Eighty per cent of us will die single and we will retire with two-thirds of the money of men… We live six to eight years longer; we have less money.”

Alongside its quest to help women attain financial security, Ellevest also places a significant emphasis on ‘gender lens' investing, which it offers to its clients as part of its product mix. 

“Our approach to gender-lens investing also includes investments that get money directly into the hands of women, in companies that advance women, and in companies that make products that impact women’s lives or provide services that benefit women most,” says Ellevest’s Chief Investment Officer, Sylvia Kwan.

If you've never heard the term ‘gender lens investing', you're not alone. It's a fairly new phenomenon that has only popped up over the past decade. But it's fast moving from the margins of investing to becoming a much-sought-after option, especially for those investors interested in ‘impact' investing, which focuses on investing in companies that make a measurable, beneficial social or environmental impact alongside a financial return.

Partly because of its star-studded funding round, Ellevest has received a fair amount of media attention, but it's not the only player in the space. Gender lens investing is gaining traction in the US, with a myriad of funds and vehicles popping up, from retail-focused through to angel investment and VC funds. Even the big banks and investment houses are getting on board, with the likes of Bank of America GlobalWealth Management and Goldman Sachs both actively pushing their female-focused investment vehicles.

“We're hearing more about gender lens investing today because there is a growing interest among consumers and investors to support gender equality as a fundamental human right,” says Jackie VanderBrug, the Managing Director at Bank of America Global Wealth Management and a thought leader in gender lens investing.

As VanderBrug points out, there has been a surge in concern from a sizeable number of investors about issues like gender equality and better access to capital for female entrepreneurs. Women consistently cite access to capital as one of the biggest hurdles they face in starting and growing a business.

Gender lens investing aims to help narrow the widely acknowledged gender funding gap, which is perhaps best illustrated by the fact women-led ventures in the US received 2.2% of the $130 billion total in venture capital money invested in 2018. That kind of figure is replicated in many other studies and findings as well.

While it has not developed to the same extent yet as in the US, gender lens investing is starting to make inroads in other countries, such as the UK, Canada and Australia. In Australia, NAB dipped a toe two years ago when it issued $500 million of ‘gender equality’ social bonds, with the proceeds of the issue refinancing loans made to businesses that have a gender equality citation from Australian government body Workplace Gender Equality Agency.

Many of its advocates emphasise that gender lens investing is as much about opportunity as it is equality. "People said impact investing is really hard and you're making it harder by imposing a limitation," says Jackie VanderBrug. “This is a lens and not a limitation. A gender lens helps you see opportunity and mitigate risk.”

Talking about her investment in Ellevest, Melinda Gates said the market was not meeting women’s needs across many areas, including financial services. “Women’s lives and realities are different than men’s, and I think we’ll see more and more of a demand for products designed to reflect that. This is an important market opportunity that Ellevest is well positioned to tap into.”

With women expected to control 75% of discretionary spending globally by 2028, and an increasing number of women asserting their right to economic independence and security, gender lens investing is well-placed to become a more prominent feature in investment circles over the next few years. Investing in women's businesses makes a lot of sense from a social perspective, and investors can expect that it will make them a lot of dollars too in the years to come. 

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Are you an autonomous or controlled entrepreneur?

Tuesday, April 23, 2019

Do you get up in the morning motivated to work on your business or is the prospect of making money what gets you through the day? That’s the fundamental difference between autonomous and controlled motivation.

We’re not all lucky enough to do what we love. Sometimes you have to work at something that doesn’t set your heart aflutter, and the motivation could be to make money or gain experience – until you can do what you love.

As an entrepreneur, though, it helps to know what motivates you because you’ll need it as fuel on your journey. On some days you’ll need to check back in with the ‘why’ that’s driving you to do the ‘what’. You’ll need the touchstone of what’s motivating you to keep you going through the tough times.

Professor of Psychology at the University of Rochester, Edward Deci, has done decades of work on motivation theory, which is encapsulated in Self-Determination Theory, which he has developed with his academic partner Richard Ryan, a Professor at the Institute for Positive Psychology and Education at the Australian Catholic University in Sydney.

According to Deci, when we think about the classic ‘carrot and stick’ idea of motivation, we’re talking about controlled motivation, which comes from either an external source or is something we might impose on ourselves as a way to get ourselves to do something.

“Controlled motivation refers to doing something in order to get some reward or to avoid some punishment. It means doing something because you’re feeling pressured, demanded, obliged to be doing it,” Deci says in this video.

In contrast to this, Deci says “autonomous motivation describes or names what you’re doing when you’re feeling a full sense of willingness, volition and choice, whatever the activity is. If you’re doing it with a real sense of interest, enjoyment and value, then it’s likely that you’re autonomously motivated.”

“When people are more autonomously motivated their performance, their wellness, their engagement, all of those things are greater when you’re autonomously motivated than when you’re controlled in your motivation.”

Deci says all human beings have three essential psychological needs: competence, relatedness and autonomy. To be productive and psychologically content individuals, we need to satisfy these needs. What we do for work plays a big part in this.

I’m lucky enough to enjoy the work I do. I’ve been an entrepreneur and business owner now for more than two decades, and I love the daily ‘grind’ of working in and on my business. I’ve been thinking recently about what it is that gets me through the long days of working on my business, The Female Social Network. The answer is that it’s a combination of factors.

At an intrinsic level, I find my work stimulating and enjoyable. I’ve always been an amateur psychologist and a lot of the work I’ve done over the years has been thinking about consumer psychology and how that applies to marketing. The curiosity I have for my work is a great motivator. Without that interest, I don’t think I could have persisted for as long as I have. Having that interest helps me to fulfil the need for what Deci characterises as competence. My engagement feeds my sense of competence. 

Another factor, and one that relates more directly to becoming an entrepreneur and business owner, is the need I have for autonomy in my work. You see this streak of independence in a lot of entrepreneurs; many of us are typically ‘square pegs in a round hole’. We don’t tend to fall in line easily, and we don’t always make the best employees!

Being an entrepreneur is partly about creating your purpose and setting the parameters for what you do. You try to craft your role in a way that makes best use of your interests and skills. The likes of Richard Branson, Steve Jobs or Jeff Bezos are probably exceptional examples, but it’s hard to imagine any one of them settling into roles defined for them by others. A tolerance for ambiguity and some risk is also a common trait among entrepreneurs, pointing to a need to satisfy our sense of autonomy and self-determination.

A third strong motivating factor for me is the social purpose behind TFSN, which is to support and empower female entrepreneurs. Again, I see this as being driven by a combination of motivations.

As a female entrepreneur, I’ve spent years pushing against the tide and seeing other women do the same. I can recognise my struggles in the struggles of the women I’ve got to know who have also embarked on their journeys as entrepreneurs. Being demeaned, discounted and ignored are all things almost all women in business have felt at some point. It hurts, but it also sparks something in me that makes me get up, get out there and keep doing what I’m doing.

There’s something in that which goes back probably to my childhood, growing up in a place and time when girls were expected to do what they were told and keep a lid on their ambitions. I think most of us feel that as women. Like men, we have an internal drive towards self-mastery and personal autonomy, but unlike men (generally speaking), we’ve too often and for too long had limits placed upon our capacity to fulfil our potential. Being able to help women and work on something like TFSN satisfies a sense of purpose and relatedness. 

As an entrepreneur, it’s worth thinking about the ‘why’ in what you do. Certainly, some people can make a go of a business even if they feel very little engagement or autonomy in what they are doing, especially if there is an endpoint built into their business plan, like a flip-around or quick exit of some sort. But to grow a business over any reasonable period requires motivation that comes somewhere from within, coupled with a purpose that resonates with that motivation.

It’s worth asking yourself how well you are satisfying your psychological needs as an individual and an entrepreneur. “When people feel competent, when they feel related to others, and when they’re feeling a sense of volition they will be autonomously motivated, and the positive consequences will follow from that,” Deci says.

As I’m experiencing in my business, when you get your internal motivation lined up with purpose and the relevant external motivators, you almost inevitably reap the benefits in both an individual and business sense.

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Women’s wealth is more than cosmetic

Wednesday, April 17, 2019

In fitting with her media profile, Kylie Jenner received an avalanche of publicity when Forbes recently announced that, at 21, she has become the youngest ever self-made billionaire, two years younger than the previous title holder, Mark Zuckerberg.

Zuckerberg and Jenner represent the peak of two quite distinct brands of American aspirational role model in the 21st Century: the world-conquering computer geek and the social media influencer/entrepreneur.

In some ways, the two roles are symbiotic: the likes of Zuckerberg have created the social media platforms that have enabled the likes of Kylie Jenner and her sisters to build personal brands, reach massive audiences, and sell tons of product. Think of Zuckerberg as the pick-and-shovel guy and Jenner as mining for social media gold, especially on the Facebook-owned Instagram, as well as YouTube and Snapchat.

Another world-conquering geek Kylie Jenner owes some gratitude to is Tobias Lütke, the German-born founder and CEO of eCommerce platform Shopify, which Kylie Cosmetics has used for its outrageously profitable online shopfront since 2015. So Kylie’s success is truly a case of Beauty and the Geeks!

There’s no doubt Kylie Jenner has become a very powerful face for her brand, Kylie Cosmetics. She has an astounding 129.1 million followers on Instagram and is, of course, one of the younger members of the Kardashian-Jenner clan. She’s following in the footsteps of her sisters Kim, Khloe, Kourtney and Kendall in parlaying her good looks, social media savvy and family connection into a personal fortune that’s estimated to be worth $1 billion.

It’s also worth looking at the influence and power Kylie’s mother, Kris Jenner, wields in the success of her daughters.

The 63-year-old matriarch has been building the family’s profile and wealth for well over a decade now. Back in the mid-2000s, Kim Kardashian was Paris Hilton’s sidekick, not the main attraction. That all changed when Keeping Up with the Kardashians debuted in October, 2007. Kim soon eclipsed Paris in the celebrity and social media stakes, and her sisters have subsequently rode her coat-tails to varying degrees of success. As their ‘momager’, Kris Jenner has turned her family and children, including Kylie, into a lucrative brand.

However, look beyond Kylie Jenner and you’ll find other stories of what it takes to become a self-made female billionaire in the US. Not quite as glamorous, and a few decades older than Jenner, at numbers one, two and three on Forbes’ list of self-made billionaires are women who have made their fortunes away from the media spotlight.

Housing supplies is not exactly as glamorous as cosmetics and Insta-fame, but it’s how Diane Hendricks has become America’s richest self-made woman, with Forbes estimating her personal value at $4.9 billion.

The Wisconsin billionaire owns ABC Supply, which is the largest wholesale distributor of roofing, siding and windows in America. The Hendricks story is like a Main Street small business fairytale. She started the business with her husband Ken in 1982. The privately held business now has an estimated annual revenue of $US9.3 billion.

Then there’s Marian Illitch, who cofounded the Little Caesar’s pizza chain in 1959 with her husband, Mike. The couple started franchising Little Caesar’s in 1962 and the chain now has more than 5,000 outlets around the world. Over the years, Illitch Holdings diversified into food services, hotels, casion and sports businesses. Forbes estimates her personal wealth at $US4.3 billion. 

And if you’re looking for a female tech entrepreneur who hasn’t received as much recognition as some of her male counterparts, it’s hard to go past Judith Faulkner, the founder and CEO of Epic Systems.

After completing her Master’s in computer science in the mid-70s, Faulkner wrote the software that would launch her company, Epic Systems, in 1979. A true startup success story, Faulkner started Epic in her basement with a $70,000 investment from family and friends. The company is still privately held even though there has been speculation it is an acquisition target for the likes of Apple or Google. It’s estimated that just over 50% of the personal health details of all Americans are held in systems powered by Epic’s software. Forbes has estimated Faulkner’s personal wealth at $3.57 billion.

Hendricks, Illitch and Faulkner show that women can achieve success in all kinds of fields. No one should begrudge Kylie Jenner’s success, but it’s worth highlighting the stories of self-made women that might not be as glamorous, or attract the same level of media attention.

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