The Financial Challenges Women Entrepreneurs Face — And How to Overcome Them

The Tools Are Right in Your Community

Sherry "Grace" Murray secured $30,000 from local, committed investors to grow her business, Lucille & Grace.

Starting and growing a business isn’t easy. It’s right up there with getting on an Olympic team or running for public office. And for many women entrepreneurs, getting the right funding can be one of the biggest hurdles. No matter how many jobs we create or how much we contribute to local economies, women-owned businesses face greater financial challenges than men. And it has lasting impacts like slower growth, limited opportunities, or even stopping promising businesses from ever getting off the ground.

But these challenges aren’t insurmountable! When we get a clear picture of what, exactly, is in the way, we can take steps to get around them. We may not like the reasons behind funding disparities, but by learning how to navigate financial options, women entrepreneurs can create  new opportunities and build successful, sustainable businesses.

Top Financial Challenges for Women Entrepreneurs

The first step to overcoming financial barriers is to know what they are. Here are the top financial challenges for women entrepreneurs.

1. Limited Access to Traditional Funding

   
   

We are working hard to get ahead! Women entrepreneurs are starting businesses faster than ever before. But we still get much less funding from banks and venture capitalists compared to men. The lack of funds makes it harder for them to scale and compete in different industries. So, we’re working harder just to keep up. 

2. Higher Interest Rates and Collateral Requirements

   
   

When women entrepreneurs do secure funding, we often face higher interest rates and stricter collateral requirements. This is a little because we still face biases in the lending industry. But it also happens because often, women have less business credit history, making them appear riskier to lenders. These decisions by banks make borrowing more expensive for women entrepreneurs, which makes it even harder for us to achieve profitability.

3. Balancing Business and Personal Financial Responsibilities

   
   

But wait! There’s more! It probably comes as no surprise to us that many women entrepreneurs juggle multiple financial responsibilities, including managing household expenses and caregiving duties. These additional things on our plates can make it challenging to invest in business growth while maintaining financial stability. Plus, the added pressure of personal financial obligations can cause us to take fewer risks and impact long-term business planning.

Solutions & Strategies for Women Entrepreneurs to Overcome These Challenges

So, here’s the deal, sister. To keep your business growing, you’re going to need capital at some point. If you’re not ready now, that’s ok, but you can take steps to make sure that when you do have a funding need, you are a prime candidate.

One of the best ways to secure funding is to strengthen your financial profile. This includes:

• Improve your business credit score by making timely payments and keeping debt use ratio low.

  
  

• Separate personal and business finances to make a strong business credit history.

  
  

• Prepare detailed financial statements and a solid business plan to show credibility to lenders.

  
  

Investment Crowdfunding as a Funding Alternative

Traditional loans and venture capital aren't the only options for women entrepreneurs. Investment crowdfunding offers a way to raise capital directly from customers, supporters, and investors who believe in your business. Platforms like Honeycomb Credit allow women entrepreneurs to access funds while building a strong community of engaged backers who want to see their businesses succeed.

Finding Mentorship and Financial Education Resources

Mentorship and financial literacy can make a huge difference in getting through business challenges. Women entrepreneurs can benefit from networking with experienced business owners, joining industry organizations, and going through financial education programs. Organizations like Women’s Business Centers (WBCs) and Small Business Development Centers (SBDCs) offer valuable resources to help women business owners thrive.

Why Women Should Consider Community Investment

Community investment, like investment crowdfunding, is a powerful tool for women entrepreneurs, and it bypasses traditional financing. Instead of relying on banks or venture capitalists, women can raise funds directly from their local communities and loyal customers. This gives you much-needed capital and strengthens the bond between businesses and the people you serve.

One Woman Entrepreneur’s Investment Crowdfunding Success Story

Several women entrepreneurs have successfully raised funds through Honeycomb Credit. For example, Lucille & Grace, a woman-owned business, leveraged community investment to expand marketing and distribution. By turning customers into investors, founder and owner Sherry “Grace” Murray was able to grow her business on her own terms.

When customers invest in a business, they become more than just consumers—they become advocates and ambassadors. Women entrepreneurs who use community investment platforms benefit from a built-in support system, helping us secure not just financial backing but also long-term customer loyalty.

Final Thoughts

Financial challenges shouldn’t stand in the way of women entrepreneurs achieving our business goals. By exploring alternative funding strategies like investment crowdfunding, building strong financial profiles, and tapping into mentorship networks, women can break through barriers and access the capital they need to succeed.

If you’re a woman entrepreneur looking for funding solutions,Honeycomb Credit may be the tool you need to raise capital and engage your community. Check us out and take the next step toward financial independence and business growth.