It’s one of America’s most stubborn myths—the young, male entrepreneur who strikes it rich with a massive tech company he started with his pals in a garage. It’s the myth behind everything from Apple to Facebook. For female entrepreneurs, we don’t hear much unless it’s from the likes of Oprah Winfrey or Gwyneth Paltrow. But now universities, think tanks, and other research institutions are starting to really look at the differences between male and female entrepreneurs, and the results are often as insightful as they can be startling.
The Confidence Game
First, overconfidence is the biggest indicator as to whether a person is going to become an entrepreneur. This has long been championed by venture capitalists and other backers of entrepreneurs as a virtue, and not a fault. It’s a phenomenon that researchers refer to as hubris in the Greek sense—a sense of misplaced confidence in one’s self and thinking you can win when others lose.
For whatever reason, women are less likely to experience this phenomenon—women tend to focus more on rational decisions, so the chaotic step of starting a business is less likely to be appealing unless the female entrepreneur has a greater sense of control over the process. This doesn’t mean that women-run companies aren’t just as successful as men. It just means the mindset of overconfidence emerges in men more often than women.
When to Begin
Another difference between male and female entrepreneurs is the age they begin their business. Men, especially ones that are driven towards entrepreneurship, tend to start early. In fact, sometimes they’re so eager to get started building their business or project that they skip university entirely or, like Zuckerberg and his peers, they drop out.
Meanwhile, their female counterparts tend to start their businesses when they are older, sometimes up to their sixties, following a first or second career. This age and experience allow women to develop their business acumen and use their life experience more wisely than a young man might.
Try, Try Again
Another factor in the differences between male and female entrepreneurs has to do with their reaction to failure. The common “wisdom” in Silicon Valley has long been “fail better,” and it’s a concept that men are more likely to embrace. Studies have found that women are less likely to try again in the face of failure than men.
This makes sense, as in the case of the overconfidence issue, because being discouraged by failure is a rational response. But because men are more likely to take a chance on another venture, it can skew the numbers when it comes time to look at the overall national picture of entrepreneurship in America.
Follow the Money
Another critical difference in male entrepreneurs and female entrepreneurs is figuring out how they each fund their business. Because men tend to start young and places like Silicon Valley are target-rich environments for startup funding, it makes sense that men tend to borrow money or open the business up to angel investors in order to launch the initial business.
Because women tend to start a business later in life, they tend to have their own resources, meaning they either have the startup funding in their personal savings or they have access to enough credit to start their business. Some even argue that because it’s their own money, women are taking more risk than their male counterparts, making them even more invested in its success.
Disruption Versus Creation
Another trope of the Silicon Valley entrepreneurial scene is disruption, and it’s a concept that has stuck firmly to male entrepreneurs. It’s a concept intended to tear down institutions and old ways of doing things, and it’s rarely about replacing those core services with something better, easier or good for society. It’s the culture that writer Dan Lyons skewered to its very core last year in the book Disrupted: My Misadventure in the Start-up Bubble.
Women, on the other hand, tend to focus more on the collective good. This is also why a lot of women such as Sophia Amorusa of Nasty Gal or Adriana Gascoigne of Girls in Tech tend to gravitate towards businesses that help other women succeed in some way. They often feel a connection to the community that manifests itself in the nature of their business or the products that they produce.
A last difference in male and female entrepreneurs surfaces in their working styles. While men may be more willing to take risk, they can also fall into the mistake of feeling the need to control every aspects of their business. Women tend to skew more towards collaborations with partners, friends or customers because they are less afraid to ask for help when they need it.
On the other hand, there may not be as much of a chasm between male and female entrepreneurs as people think. The scholar Vivek Wadhwa did a study recently that found there wasn’t that much difference in the two. The lesson here is to try not to generalize, but to take each entrepreneur at his or her own merits, and measure their success by their actions, and not by their characteristics, motivations, or susceptibility to trends.