Female entrepreneurship: Evidence-based high-impact perspective from Chile and Peru /Emprendimiento femenino: Perspectiva de alto impacto basada en evidencia de Chile y Per - Vol. 38 Núm. 162, Enero 2022 - Estudios Gerenciales - Libros y Revistas - VLEX 900147165

Female entrepreneurship: Evidence-based high-impact perspective from Chile and Peru /Emprendimiento femenino: Perspectiva de alto impacto basada en evidencia de Chile y Per

AutorHuam
CargoResearch article
  1. Introduction

    Female entrepreneurship has been investigated in-depth through a vast literature. According to Lederman, Messina, Pienknagura and Rigolini (2014) and Kantis and Angelelli (2020), the economic future of Latin America will depend on the number of entrepreneurs who create more jobs and have a high level of productivity, but meeting these goals could be hindered by a low level of innovation. Despite the fact that in Latin America the number of enterprises led by men and women hardly differs in quantity (Serida, Alzamora, Guerrero, Borda and Morales (2018), research indicates that most women engage in areas such as trade and services with smaller companies, within these, growth, higher sales, level of innovation, and high profitability are not usual or go unnoticed; therefore, their enterprises are related to necessity rather than opportunity. These necessity-driven companies are generally related to a less important role in a country's productive framework (Acs and Amorós, 2008; Bonilla and Cancino, 2011; La Paz, Cancino and Miranda, 2012), because they seem as not having a significant impact, either in sales, employability, raised capital, or in export volume.

    Female entrepreneurship research has been developed in different countries, exploring the effectiveness of public policies aimed at women entrepreneurs (De Mel, McKenzie, and Woodruff, 2014), institutional factors (Aparicio, Urbano, Audretsch and Noguera, 2019), the presence of microcredits to promote entrepreneurship (Emran, Morshed and Stiglitz, 2011), or the social value generated by non-traditional female entrepreneurship (Analoui and Herath, 2019). Moreover, there is research that explains the higher probability of survival of ventures led by men compared to those led by women (Yang and Triana, 2019). Thus, these previous studies show a common pattern, where female entrepreneurship is naturally associated with disadvantage, inequality, precariousness, or subsistence, presuming individual interests such as escaping from poverty, as well as national interests such as improving the employability rate, reinforcing a strong relationship between female entrepreneurship and necessity entrepreneurship.

    Nevertheless, the entrepreneurial ecosystem in Chile and Peru shows that not all cases of female entrepreneurship fall into the category of low-impact or necessity entrepreneurship (Kuschel, Lepeley, Espinosa and Gutierrez, 2017; Kuschel and Labra, 2018). Indeed, there are increasing cases of new women-led businesses (WLBs), where the motivation to create a business does not come from necessity, inequality, or lack of opportunities. On the contrary, it comes from the idea of growing, innovating, and being able to expand locally and internationally; that is, from the motivation to seek opportunities for innovative and successful business models. This behavior is supported by research on this kind of entrepreneurship cases (Kuschel et al., 2017).

    This study aims to analyze different WLB cases in Chile and Peru, which are not related to assistance, subsistence, or low impact; on the contrary, new businesses looking for ways to rapidly grow and achieve above-average profitability levels. To develop this, five dimensions of analysis are proposed in connection with: (i) founders' personal characteristics; (ii) the technological level of the entrepreneurship sector; (iii) the level and type of innovation; (iv) internationalization scope; and (v) public policies' impact. To address this objective, the paper proposes the following research question: What are the main characteristics of Chilean and Peruvian WLBs different from the traditional subsistence perspective achieving high impact? To answer this question, the methodology used consists of a multiple case study, specifically analyzing seven WLB in each country. The sample was obtained from the databases of companies assisted by the Endeavor international accelerator (subsidiaries in Chile and Peru), which is well-recognized for supporting high-impact entrepreneurs.

    The results of this study show that WLBs in developing countries can be associated with growth, opportunity, and high impact. Likewise, some drivers for this would be innovation and the value added to traditional products and services; intensive use of information technologies; the influence of the ecosystem supporting WLB, public policies' effectiveness and accessible networks; and finally, the tendency and motivation to participate in international markets since founding the business. Consequently, given the promotion of an opportunity-based approach to the firms undertaken by women in Latin America, the article reinforces the concept of WLB, emphasizing that there are many cases seeking for new opportunities, achieving substantial growth and high impact.

    In addition, given the study's results, this paper aims to motivate and influence public policy makers in Latin America, particularly Chile and Peru, to align their support programs towards female entrepreneurship. Furthermore, while a new concept for WLB is not proposed, the results look to shift the associated paradigm of scarcity and necessity to opportunity and high growth.

    This article is structured as follows. The second section focuses on describing the literature related to the research topic. The third section shows the methodology used and describes the case studies. The fourth section discusses the results of the WLBs under analysis. Fifth section presents the arguments for policymakers and researchers, and the last section provides the conclusions of the study.

  2. Literature Review

    What would explain the association between female entrepreneurship and low impact? For Brydges and Hracs (2019), many women define the idea of entrepreneurship and being their own boss as a way to positively balance work and life, which often involves taking care of household chores and raising children. Likewise, other studies argue that women usually decide to venture into businesses similar to those performed at home, such as trade and services (Kobeissi, 2010; Kargwell, 2012), in the pursuit of being culturally and socially accepted. For Yang and Triana (2019), this is quite strange, since the economic results of entrepreneurial activity in commerce and services are not directly related to lower performance.

    Nonetheless, there is a bias regarding women's entrepreneurship as a necessity entrepreneurship. Hence, in many countries, public programs have been developed to improve the outcome of women's entrepreneurship. For instance, De Mel et al. (2014) analyzed a productive support program that sought to enhance the growth of women's entrepreneurship in Sri Lanka through training and technical assistance. Moreover, these new businesses did not manage to grow and most of them would be mainly subsistence low-impact ones (Emran et al., 2011; Analoui and Herath, 2019; Córdova and Huamán, 2019).

    In order to challenge this traditional relationship between female entrepreneurship and necessity entrepreneurship, it is important to highlight cases of WLB unrelated to necessity and vulnerability as relevant drivers for economic activity. In fact, Kuschel and Labra (2018) comment on the identity of the first generation of female technology entrepreneurs in Chile, who created completely original companies driven by technological opportunities. Therefore, there are many cases of women entrepreneurs who have managed to develop and expand their businesses, which can be defined as high-impact ventures (Endeavor, 2020).

    Previous research has argued that the success of women entrepreneurs would depend on factors such as determination, education, business resilience, personal satisfaction, and the provision of employment (Agarwal, Ramadani, Dana, Agrawal and Dixit, 2021). High impact ventures, also defined as by opportunity or dynamic ventures, are likely to have a close relationship with more developed countries (Reynolds, 2002). These businesses can have a positive effect on economic development and growth, and introduce a beneficial change in entrepreneurial activity as a whole (Acs and Amorós, 2008; Larroulet and Ramírez, 2008). High impact businesses are understood as ventures in which entrepreneurs decided to take advantage of a market opportunity using innovation as a main driver (Amorós and Poblete, 2013), and are considered as a key aspect to compete with differentiated products and services in both national and international markets (Hitt, Ireland, Camp and Sexton, 2001).

    2.1 The importance of innovation and the level of technology

    According to The Organisation for Economic Cooperation and Development (OECD) (2007), in the Oslo Manual there are four types of innovation, including product, process, organizational, and marketing innovations. The first two are generally called technological innovations while the other two are non-technological. However, as for the most current version of the Oslo Manual (OECD/Eurostat, 2018), a reduction was made from these four types to exclusively the first ones being called technological innovations; that is, product innovations and business process innovations. Considering the latest changes, the general definition of innovation remains being relative to a new or improved way to do things that differs significantly from the previous and is useful for internal or external purposes, whether these are technological (product and processes) or non-technological (organisational and marketing).

    Many people promote innovative ventures, especially those with a technological background (Audretsch and Link, 2018), as this is a traditional view of innovation. For the Inter- American Development Bank (IADB) (2020), this type of enterprise would enrich the productive and business frameworks of a country. Nevertheless, Chesbrough (2007) stated that innovation is not necessarily linked to technology (products and processes), but also to changes in the business model...

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