From Crisis to Confidence: How Women Entrepreneurs Fared During the Pandemic

Goldman Sachs Study on Women Entrepreneurs During the Pandemic

• Study Scope and Methodology

  • Goldman Sachs conducted research in February and March involving 1,100 women alumni from the "10,000 Small Businesses" and "10,000 Women" programs across 37 countries.
  • The initiative leveraged over a decade of engagement with the 10,000 Small Businesses program (launched >10 years ago in the U.S., France, and UK) and the 10,000 Women program (launched 13 years ago for developing markets).
  • Key findings indicate that nearly 100% of respondents experienced some difficulty running their businesses, with financial decline and caregiving responsibilities cited as the primary stressors.

• Financial Impact and Business Survival Rates

  • Approximately 60% of respondents reported revenue declines, while the second most significant challenge was the dual burden of caregiving and business management.
  • Survival rates remain high: 86% of alumni continued operations, 8% temporarily closed, and only 3% permanently closed their businesses.
  • Despite a 13% drop in community contributions (primarily due to financial constraints), 86% of entrepreneurs continued to give back, with 95% in the U.S. maintaining philanthropic efforts.

• Sector Disparities and the "Boom vs. Bust" Dynamic

  • Women entrepreneurs are disproportionately represented in retail, hospitality, and service sectors, which suffered severe lockdown impacts ("the bust"), while being underrepresented in technology and agriculture sectors that saw growth ("the boom").
  • Over half of global women's entrepreneurial activity occurs in wholesale and retail trade, and most start in health, education, and social services, sectors heavily hit by income loss and lockdowns.
  • Conversely, businesses in healthcare, technology, and remote-capable industries saw revenue increases, a demographic from which women entrepreneurs are statistically less likely to benefit.

• Resilience, Pivoting, and Digital Adoption

  • 70% of alumni pivoted or permanently changed their business models in response to the pandemic.
  • Digital adoption accelerated significantly: 74% of women invested or plan to invest in technology training, and 70% identified technological skills as a top future priority.
  • In China, 90% of women entrepreneurs reported that technology would have the most profound impact on their business efficiency and operations.
  • Goldman Sachs is launching a new 10,000 Women course focused on digital tools, social marketing, and enhanced online sales to support this transition.

• Caregiving Burden and Workforce Impact

  • 76% of respondents reported a greater focus on family/personal commitments, and 69% are primary caregivers, leading 43% to report an increased impact from these commitments on business management.
  • Stretched responsibilities caused 50% of the cohort to feel their work performance declined, mirroring broader trends where 60% of working parents reported receiving no outside help for childcare in developed nations.
  • The lack of child support contributed to mothers leaving the workforce at higher rates than fathers during the pandemic's peak.

• Optimism and Regional Variances

  • 78% of respondents remain optimistic about future business prospects, though sentiment has declined slightly from pre-pandemic levels.
  • Significant regional divergence exists: confidence dropped most sharply in Latin America (48% in Mexico, 46% in Brazil feel confident), whereas Asian emerging markets, notably China, retained higher confidence levels.
  • Goldman Sachs warns that reduced confidence (reported by 21% as business leaders and 34% regarding business) may lead to risk-averse strategies, hindering growth and capital-seeking behavior.

• Strategic Recommendations and Future Outlook

  • Key solutions identified include promoting women's technology training, enhancing affordable childcare availability, providing advanced access to capital, and fostering women's support networks.
  • Call to action emphasizes that supporting women entrepreneurs through capital, networks, and mentorship is vital for global economic recovery, not merely an option.
  • Goldman Sachs aims to reinforce "womanomics" by ensuring pandemic challenges do not undo decades of progress in closing the gender gap.

Case Study: Mancha Feha (South Africa)

• Business Transformation and Revenue Shock

  • Mancha Feha, a Johannesburg-based content creator and speaker, experienced a 100% revenue drop to zero during the four-month lockdown, as her business model relied entirely on in-person events and speaking engagements.
  • The crisis forced her to return deposits to clients who had paid for canceled events, creating immediate cash flow distress and initial feelings of depression.

• Pivot to Digital and Crowdfunding

  • Feha launched a crowdfunding campaign that shifted her service model from in-person to online coaching and recorded webinars, allowing her to generate revenue despite lockdown restrictions.
  • By prioritizing social media sales and professionalizing her online presence (investing in studio quality, lighting, and sound), she sold more books online in one month than she had previously in person.

• Long-Term Strategic Shifts

  • Feha adopted a hybrid business model, committing to maintain online content sales alongside in-person events post-pandemic to create "residual income" from single content creation efforts.
  • She emphasizes the lesson of "creating content once and selling it multiple times," contrasting with her previous model of preparing fresh material for every speech.
  • Personal growth lessons included mastering the delegation of low-level household tasks to focus on high-value business work and discovering increased personal resilience through the crisis.

• Psychological Impact and Confidence

  • Despite early fears of bankruptcy, Feha reports increased confidence in her business capabilities, attributing this to the forced mastery of global digital tools like MS Teams and Zoom.
  • She now feels equipped to participate in global markets regardless of physical location, citing the "growth fellowship" experience as a catalyst for realizing her access to global networks.