It’s Been a Tough Year for Women Founders. Here’s How They’re Handling It

For two months this summer, Stefanie Tacata worked out of her car. She and her wife were living with Tacata’s parents so that Tacata’s mother could look after their baby daughter. “Those first few weeks [of remote work]–it’s a blur, to be honest,” says Tacata, who co-founded Stateless Fashion Design and Consulting, a New York City-based company that develops and launches clothing lines for brands, with her wife, Souad Acha.

During a pandemic and economic recession, the challenges faced by women founders only multiply. Inc.’s 2020 State of Entrepreneurship survey, conducted with sister publication Fast Company, asked founders what it’s like to lead a business in the Covid-19 era. The responses from 229 women who completed the survey highlight three perennial problems faced by women that the pandemic has exacerbated: acquiring outside capital, managing childcare, and mental health issues. 

It’s hard to overstate the financial devastation wrought by the coronavirus on America’s small businesses, and women founders felt it keenly. Among the women who responded to Inc.‘s survey, 42 percent said the pandemic has pushed revenue down by 25 percent or more compared with the same time last year. In some industries, sales sputtered out in March and didn’t even begin to pick up until August.

“We essentially dropped to zero almost immediately,” says Joanne Sonenshine, whose Arlington, Virginia-based consulting firm, Connective Impact, helps nonprofits and international-development companies partner with government agencies. After several large clients halted their contracts, she says, “We had nothing in the pipeline, nothing happening.”

Samantha Snabes, a co-founder of re:3D, a 3-D printer manufacturer in Houston, saw sales drop and shipping costs skyrocket overnight. “There was a period of time for about four months where, in every way, we just couldn’t win,” she says.

Many founders sought loans and grants. While government aid is hardly a replacement for lost revenue–and the federal Paycheck Protection Program reached only a fraction of America’s small businesses–55 percent of women survey respondents took advantage of federal money to keep their businesses afloat. And 63 percent said they have not had to furlough or lay off any workers. For these women, the government stimulus programs worked as intended, allowing them to keep the lights on while figuring out what to do next.

Sonenshine says the PPP was “a total game-changer” for her business. She has no full-time employees but had to let go of all but one of her part-timers. PPP and Economic Injury Disaster Loan (EIDL) loans helped keep the business going until she could land new contracts. Now, she’s hiring.

“We’ve had to completely scrap all of the 2020 revenue goals, all the 2020 forecasts, and kind of start over,” she says, but “the outlook is pretty positive.”

If the drop in sales and abrupt transition to remote work weren’t bad enough, Covid-19 also created a childcare crisis. Fifty-one percent of women respondents who have children under 18 said they, not their spouse or someone else, spend the most time caring for children and helping them with at-home learning during the pandemic. (Some 29 percent said their children are old enough to need less supervision.) And while 17 percent of male respondents named themselves the primary caregiver, only 10 percent of women named their spouse or partner.

After trying to work from their apartment without childcare, Tacata and Acha stayed first with one founder’s family and then the other’s. Working long hours to keep their business afloat, they eventually settled in the suburbs, where their daughter could benefit from outdoor space–and a spot at a day-care center. Says Tacata, “It’s not my ideal thing, but it is reality.”

With the boundaries between work and home blurred, some women founders–even those whose businesses have started to rebound–are scaling back their growth plans. Sonenshine, whose 9- and 11-year-old sons began the school year remotely, says she’s rarely able to sit down and devote her full attention to business strategy. “I’m operating at 30 to 40 percent at most,” she says. She’s counting on an eventual return to in-person school to provide a reprieve. If remote learning continues past early 2021, she says, “I’m very concerned about the longevity of the business.” 

The extreme pressure of running a company during a global crisis exacts a cost beyond what’s measurable in dollars. Eighty-one percent of women respondents to Inc.’s survey reported recent mental health issues, including anxiety, insomnia, and exhaustion. “Nobody’s sleeping,” says Sonenshine. Snabes says she’s often so busy that she forgets to eat or goes a week without showering. “There are days when you just cry,” she says.