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It’s All in
Their Minds
Successful Connecticut women entrepreneurs say concept
and commitment are more important than cash
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Business New Haven
4/5/1999
By: Fiona Phelan
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The risks a female entrepreneur takes when she begins her own business are often indefinable - they're personal risks and emotional risks rather than just financial risks (although most are willing to take those, too).
A woman starts her business with an idea that often grows out of something she has an interest in, or something that is her hobby. The woman takes that idea and builds it in to a successful business. Sometimes these ideas don't require a lot of capital to get the business off the ground.
The females starting businesses in the Nutmeg State come from all walks of life. Some have had high-profile, successful careers with large corporations, others have come from teaching, and some have built new businesses that complement their family lives.
The Connecticut office of the U.S. Small Business Administration (SBA) notes that the top growth industries for women-owned businesses are construction, wholesale trade, transportation, communications, agribusiness and manufacturing.
“A woman who is starting a business faces greater risk than a man,” says Barbara Allen, president of Stabar Enterprises Inc. “I think it is much more difficult in terms of credibility for a woman to get back into the workforce if her business doesn't succeed. You're looked at as being on the half-track versus the fast track.
“The same is not true for a man,” she adds. “They're much more likely to pick up where they left off in terms of position and salary.”
Allen, who left a successful career as a law professor, started her Farmington-based business from home in 1994. Today the company has a staff of 50 and annual revenues between $5 million and $6 million. All this from the sale of an all-natural pet product that promises to stop dogs and cats from shedding.
In trying to launch the company, Allen pursued the conventional route of applying for a bank loan - a process which left a sour taste. Unwilling to pledge her home as an asset and reluctant to have her husband co-sign a loan, Allen turned to her credit cards for financing.
“We used our credit cards for everything from office supplies to product supplies, research and development,” she says. “I kept my full-time job until the company began showing signs of success and then we were able to attract $3 million in venture capital from some investors.
“It was a very difficult road. Personally we almost got to rock-bottom before the business really took off,” she adds. “We leveraged our lives to get the business up and running.”
According to the National Foundation for Women Business Owners (NFWBO), in 1996 there were 103,5000 women-owned businesses in Connecticut, including part-time firms. Those businesses employ more than 250,000 people and generate $38.4 billion in sales. Between 1987 and 1996, the number of women-owned businesses increased by 56.2%.
According to a NFWBO study sponsored by Salomon Smith Barney last year, the primary reason women launch new businesses is that they are inspired by an entrepreneurial idea. The next most frequently cited reason women give for starting a business is frustration with their previous work environment.
The national survey of 800 women and men business-owners also revealed that women were more likely than men to turn a personal interest into a business pursuit (14 percent of females versus two percent of men). Males, the survey noted, were much more likely to start businesses that were closely related to their previous jobs or careers.
Sue Glasspiegel of Simsbury took her desire for part-time professional employment seriously enough to create a company that places professional women in part-time jobs. Flexible Resources Inc. has been in business for six years. Last year, working part-time from her home, Glasspiegel estimates she drew a salary of $120,000. Her part-time partner did the same. The company also has an office in Greenwich and recently opened one in Boston.
Glasspiegel began the business from home following the birth of her third child. Equipped with a copier, fax, telephone and printer, the only thing she needed to get her business off the ground was a computer.
“The financial outlay was not major,” she notes, “and the financial risks were not there, but my expectations were very high. I have not been disappointed.”
The bulk of women seeking part-time employment through Flexible Resources are moms, while the remaining 35-40 percent are retirees or consultants who work on specific part-time projects for other companies, says Glasspiegel.
Glasspiegel is also president of the Connecticut chapter of the National Association of Women Business Owners (NAWBO). This professional organization boasts 150 members in the state and adds about five new ones each month. The group offers social, economic and political support to women with established businesses.
“Our mission is to help women business owners who want to get to the next level,” says Glasspiegel. “We offer publicity, advice for women-owned businesses that are trying to procure government contracts, political support on issues that affect women-owned and small-business owners, and workshops and seminars on specific issues like business insurance and doing business on the Internet.”
NAWBO member Roxanne Coady was a certified public accountant with an international firm before she opened an independent bookstore in Madison. Ten years later the bookstore has expanded and added a café; area residents receive a bookstore newsletter and there is a Web site.
R.J. Julia Booksellers is a success. But even though there were no family sacrifices to make, Coady says there were other personal sacrifices.
“We took a risk. We left behind everything that we had built in New York and in our careers,” Coady says of her and her husband's decision to open the store. “We were two adults making a decision, and at the time it didn't affect any family. If I had to do it again I'd be a lot more careful about the things I chose to do.”
Females, Coady says, become successful business owners because they have confidence in what they're doing, they rely on their intuition and are able to operate on many different levels.
For women looking for help in getting their ideas off the ground, the SBA's Office of Women's Business Ownership provides business skills training, counseling, mentoring, education and outreach to women entrepreneurs.
In addition, the office's home page on the World Wide Web provides an interactive, multimedia, electronic guide which includes material on SBA programs and services; “hot links” to women's organizations; services to women by other federal agencies; and topical information of interest to the woman entrepreneur (www/sba.gov/womeninbusiness).
One of the SBA's most successful programs is its Pre-Qualification Loan Program, which is geared toward current and prospective women, minority and veteran small-business owners.
According to SBA Public Information Officer Allyson Diana, the program uses non-profit organizations as intermediaries to assist prospective eligible borrowers in developing viable loan packages. These non-profit groups help entrepreneur develop business plans and complete pre-qualification loan applications.
After submitting the application, the SBA makes its decision within three working days. It then issues a letter of pre-qualification, which can be taken to any of 118 SBA-approved lenders in the state. All services are free of charge. The maximum loan amount is $250,000.
In addition, Diana adds, the SBA has a “LoDoc program” which is a two-page application for loans up to $150,000. Applicants receive their answer within 24 hours, she says.
While the SBA programs do not require any collateral, Diana says that female applicants are not hesitant about pledging any assets they have in order to start their own businesses. Last year the Connecticut office of the SBA issued 182 loans to women, representing almost 17 percent of the 1998 total.
The SBA encourages entrepreneurs to seek free advice and counseling from organizations such as the Connecticut Small Business Development Center and the Connecticut Service Corps of Retired Executives (SCORE).
SCORE members offer management and technical expertise to current and prospective business owners by providing free individual counseling sessions. During counseling, SCORE members help clients with the SBA loan process, preparation of viable business plans and other documents necessary for obtaining an SBA loan. In addition, regularly scheduled workshops are provided for a fee to further help small-business owners and budding entrepreneurs.
“I took my business plan to SCORE and they were very helpful in getting me going in the right direction,” says Lisa Wadge. The Killingworth resident recently sold her second small business to Vista Information Solutions Inc. of San Diego. The company specializes in geographic information systems involved in plotting and tracking the environmental Superfund sites across the country.
Wadge started her first business in the 1980s with a $5,000 bank loan to purchase a computer. When that business grew to 17 employees, Wadge sold the company and started another type of environmental engineering consulting company.
“It wasn't easy,” she recalls. “Starting something new always takes extra effort. A lot of people gave me the benefit of the doubt that I could make the company viable, and people went out of their way to help me.
“It takes a lot of time and energy to start a business,” Wadge says. “It's a lot like getting an airplane off the ground - it requires a lot of momentum.
“But if you're going to do it, you have to jump in all the way. Owning a small business is like having a child - it's all-consuming. You have to be willing to dedicate 110 percent of your time,” Wadge says.
Like young children, a young business needs a lot of attention. As the business gets older, it requires less attention. You have to be passionate about wanting the business to succeed,” she adds.
“Your success will depend on your enthusiasm.”
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