Breaking the $1 million ceiling

DFJ's Jennifer Fonstad and five other experts debate what keeps more women entrepreneurs from growing big.

Mar. 29, 2006

excerpt from article

Just seven percent of million-dollar-plus companies are owned by women -- but that's changing fast.

While there's nothing magical about $1 million in sales, that number has taken on symbolic importance to small-business owners -- both male and female -- who desire to grow big. Yet why do females lag behind males as members of the million-dollar club?

Is it a lack of desire to run a large operation, spawned by the realities of balancing work and family?

Discrimination by the equity investors who could fuel the companies' growth?

Exclusion from the old-boy network that opens the door to government and corporate contracts for men?

Or is it something else altogether? And how is the playing field shifting?

We sought answers from a panel of women executives and entrepreneurs. And what they had to say was fascinating.

Jennifer Fonstad, managing director of the venture capital firm Draper Fisher Jurvetson in Menlo Park, Calif. Why are so few businesses with more than $1 million in annual sales owned by women? I think there are many more women business owners than the statistics show. The numbers are based on women owning 51% of the business. In the venture world the entrepreneur who founds the business may typically own only 10% to 25% of the company. Often a woman is on a team of men who are co-founders.