Abstract:
This research set out to understand the challenges facing black female entrepreneurs in South Africa in accessing early-stage capital for high growth ventures This research further sought to examine how these entrepreneurs used entrepreneurial ecosystems (EEs) to access capital against the theory of social capital as an entrepreneurial resource. The report outlined the experiences of fourteen South African black female entrepreneurs and insights of four South African fund managers into the challenges faced by these entrepreneurs. Qualitative techniques were used to reveal the entrepreneurial journey of female entrepreneurs to access early-stage capital.
The study underscored the rigorous requirements of funders. Findings indicated the importance of angel investment or seed capital as a necessary pre-cursor to venture capital. The study also showed that non-financial support played an essential role in early-stage entrepreneurship. The research found that women entrepreneurs experienced gender bias because of gender stereotypes. The study did indicate however, that cultural expectations and the traditional role of women, were inhibiting factors. Results showed that entrepreneurs relied extensively on social networks to access resources. Results further demonstrated that black women face challenges in accessing certain networks which prejudices their ability to raise capital. The study showed that background, education, and work experience were significant contributing factors to entrepreneurial success. Finally, research indicated mixed views on the effectiveness of South African government support.
The research contributes to the theory of entrepreneurial ecosystems by enriching the understanding of the interactions between different components of the EE and demonstrating the impact of social capital on black female entrepreneurs in an emerging market/developing country context. This report contains recommendations for policy makers and the designers of SME development programmes.
