5 Reasons Women Entrepreneurs Should Consider Buying a Business (Infographic) Women comprise a growing percentage of entrepreneurs but seem less interested in buying a business than in starting their own.

By Mark Daoust

Opinions expressed by Entrepreneur contributors are their own.


You may have seen that the number of women entrepreneurs is on the rise. But even though female entrepeneurship is growing - up 30 percent since 2007 -- there is still work to do.

Currently, women only make up 37 percent of entrepreneurs, and if we look at how women participate in entrepreneurship, we see that they are lagging in many key categories.

I reviewed my firm's last three years of transactions - we help online entrepreneurs sell their web based businesses -- to see if I could learn more about how women were involved in this part of entrepreneurship.

Follow Us: Women Entrepreneur on Facebook, Twitter and Instagram

We gathered a lot of interesting data, but the number that stood out above all the rest was the fact that out of all the acquisitions we inspected, only three percent of the buyers were women.

Women & Entrepreneurship

Source: Quiet Light Brokerage

Why don't women look to acquire?

The lack of interest in acquisitions could be a result of natural differences between men and women. Kat Loterzo, a successful business coach, noted what she observed in differences between her male and female clients.

According to Loterzo, for women, their business is something that they allow to be deeply tied in with their identity. So they'll make their decisions more based on emotions rather than based on outcome. As a result, most women will be less likely to want to buy someone's business.

Psychology Today has published a lot of information on the differences between genders. Among their observations, it notes that "girls and women tend to input or absorb more sensorial and emotive information than males do."

Because women have a tendency to view their business more as a part of their identity, it seems that they are less likely to want to make someone else's business their own.

Women should consider acquisitions.

Depending on the type of business you want to build, there can be many benefits to building one rather than buying one. For example, if you are looking to disrupt a marketplace, you'll be looking at a startup.

However, depending your goals, an acquisition may actually help you reach your goals quicker. Acquisitions allow you to do the following.

  • Reach profitability quicker. Startups often see little to no profits in their first year or first few years. Buying an existing business allows you to tap into profitability from day one.

  • Acquire goodwill. Goodwill is all the non-tangible business assets that are difficult to replicate. This includes a business reputation, its branding or customers offering referrals. Goodwill takes time to build, unless you acquire it.

  • View historical data. Starting a business involves a process of testing and experimenting with what works and what doesn't work. This can take time, money and a lot of effort. When you buy an existing business, however, you have reams of historical data at your disposal.

So what factors should you consider before making an acquisition? Loterzo offers five suggestions for women, who are considering an acquisition.

Related: 7 Steps to Prepare Your Company for an Acquisition

1. Don't let your identity get wrapped up in your business.

Kat already explained why many women don't pursue acquisitions. However, when looking at potential acquisitions, it's important to take a step back from the business you want to acquire. This will help you make a results-driven decision.

"If you want to be successful as an entrepreneur, you need to learn to make decisions based on the result you want," Loterzo said. "These should not be emotional decisions. Emotions can factor in, but ultimately, to take a step forward in business and be successful, you need to be able to put emotion aside and ask 'What are the facts and what is the expected result?'"

2. Ditch the women's entrepreneurial groups.

While entrepreneurial groups can be invaluable resources for networking, advice and support, Loterzo sees many women's groups influencing female entrepreneurs to do things that are not results-driven.

Instead, rather than turn to these groups for advice, find someone who has acquired a business before, and ask them for practical constructive advice.

Related: My Post-Acquisition Report Card

"There is a bit of a rainbows and unicorns type of feeling around the land of female entrepreneurship. You're going to end up in this world of women, who are talking about "What color should I make the picture on my website?' or "What do you think of my new photos?' But when I go into male entrepreneurship groups, the focus is much more from the get-go on "What do I need to do to get this monetized?' rather than "First I'm going to spend $20,000 or $30,000 on a website or photoshoot' or pretty much nothing of substance."

3. Focus on the analytical.

While men and women are equally analytical in their thinking, women's brains are wired to combine analytical and intuitive thinking. Intuition is a powerful force when looking for problems in an acquisition. However, determining the upside of a business should be done on more of an analytical level.

4. Don't let fear delay your dreams.

In a way that only Loterzo could say, "Don't let your bullshit be bigger than your dreams."

Psychology Today noted that women tend to react more negatively to unpleasant experiences, and also experience less joy at positive outcomes than men. This can lead to more hesitation when pursuing an entrepreneurial goals.

5. Take advantage of your intuition.

While a business should be bought based on objective data, using intuitive thinking that comes more naturally for women is something to take advantage of. Buying a business involves a series of objective and subjective clues and cues. Women seem better equipped to sense danger signals than men.

"Women are able to tap into their intuition more readily than men - to go on gut feel -- and use their emotion to their advantage. This is very relavant to acquisitions," Loterzo said.

Related: 7 Vital Steps to Position Your Company for Acquisition

Depending on what your entrepreneurial goals may be, looking toward buying a business may be the path that brings you the result you are looking for. As women continue to make inroads as entrepreneurs, hopefully more women will consider acquisitions and the benefits that buying a business can bring.

Wavy Line
Mark Daoust

Founder, Quiet Light Brokerage

Mark Daoust’s passion for creating sales agreements that benefit both sides of the table led him to create Quiet Light Brokerage in 2007. Guided by the bedrock values of honesty, integrity and transparency, Daoust built Quiet Light to help sellers of internet businesses. His own business recently was selected as the #1 brokerage for buying and selling websites valued at over $1 million. Quiet Light and Daoust are headquartered in Minnesota, where Mark sometimes gets to run home to help his wife teach a quick class to his four children.

Editor's Pick

A Leader's Most Powerful Tool Is Executive Capital. Here's What It Is — and How to Earn It.
One Man's Casual Side Hustle Became an International Phenomenon — And It's on Track to See $15 Million in Revenue This Year
3 Reasons to Keep Posting on LinkedIn, Even If Nobody Is Engaging With You
Why a Strong Chief Financial Officer Is Crucial for Your Franchise — and What to Look for When Hiring One

Related Topics

Business News

More Americans Are Retiring Abroad, Without a Massive Nest Egg — Here's How They Made the Leap

About 450,000 people received their social security benefits outside the U.S. at the end of 2021, up from 307,000 in 2008, according to the Social Security Administration.

Business News

Woman Ties the Knot at White Castle Almost 30 Years After the Chain Gave Her Free Food as a Homeless Teen

Jamie West was just 12 years old when she ran away from the foster care system.

Business News

Lululemon Employees Say They Were Fired for Trying to Stop Shoplifters

Two Georgia women say Lululemon fired them without severance for trying to get thieves out of the store.

Business News

7 of the 10 Most Expensive Cities to Live in the U.S. Are in One State

A new report by U.S. News found that San Diego is the most expensive city to live in for 2023-2024, followed by Los Angeles. New York City didn't even rank in the top 10.

Business News

New York Lawyer Uses ChatGPT to Create Legal Brief, Cites 6 'Bogus' Cases: 'The Court Is Presented With an Unprecedented Circumstance'

The lawyer, who has 30 years of experience, said it was the first time he used the tool for "research" and was "unaware of the possibility that its content could be false."