commissioned by American Express OPEN.…his report was commissioned by American Express OPEN and published in March of 2013. The information contained in this report was prepared

Growing Under the Radar: An Exploration of the Achievements of Million-Dollar Women-Owned Firmscommissioned by American Express OPEN

ALICE LANE HOME COLLECTION

ADAM BENNETT AND JESSICA BENNETT,

MEMBER SINCE: 2001

LEAH BROWN

A10 CLINICAL SOLUTIONS, INC

MEMBER SINCE: 1998

FACE STOCKHOLM

MARTINA ARFWIDSON, GUN NOWAK

MEMBER SINCE: 1994

KEEPME.COM

ALISON KAY AND ANNE DES BARRES

MEMBER SINCE: 2004

2

GROWING UNDER THE RADAR: AN EXPLORATION OF THE ACHIEVEMENTS OF MILLION-DOLLAR WOMEN-OWNED FIRMS

This report was commissioned by American Express OPEN and published in

March of 2013. The information contained in this report was prepared from

sources and data that we believe to be reliable, but we make no representation

as to its accuracy or completeness and we assume neither responsibility nor liability

for any damages of any type resulting from any errors or omissions. The report is

provided solely for informational purposes and is not to be construed as providing

advice, recommendations, endorsements, representations or warranties of any kind

whatsoever. Opinions and analysis contained in this report represent the opinions and

analysis of Womenable, a research, program and policy development consultancy,

and do not necessarily represent the opinions or analysis of American Express

Company or any of its affiliates, subsidiaries or divisions (including, without limitation,

American Express OPEN).

Our sincere thanks are extended to the Economic Census Branch of the Company

Statistics Division of the U.S. Census Bureau, which provided invaluable insights

during the preparation of this analysis.

Visit openforum.com/womensbusinessreport

3


In the second annual State of Women-Owned

Businesses Report, published by American Express

OPEN in March 2012, we noted that over the past 15

years, just 2% of women-owned firms have reached

or surpassed the million-dollar revenue threshold.1

We surmised that one reason for a lack of progress

at the highest levels of business achievement may be

that women-owned firms are “growing past” the 51%

ownership definition, thereby disappearing from the

ranks of “majority women-owned.”

It is also the case that a wide variety of firms are found

within the “million-dollar plus” population—ranging

from relatively small, privately held $1 million firms to

large, publicly traded multi-billion dollar corporations.

Certainly the absolute number of million-dollar women-

owned firms has grown over the past decade (+31%).

Perhaps even if the share of million-dollar women-owned

firms has not increased, the economic robustness of

businesses within this top size category has grown.

We are now able to shed new light on this important

issue. This report examines data that have never before

been published, investigating the growth in the number of

million-dollar firms within more detailed size categories:

$1 to $4.9 million, $5 to $9.9 million, and $10 million+.

This analysis does indeed show that women-owned firms

have been “growing under the radar.”

QUICK FACTS

• Over the past decade, the growth in the number

of women-owned firms with $10 million or more in

revenues has increased by 56.6%, a rate 47% faster

than the rate of growth of all $10M+ firms and

nearly twice (+98%) the rate of growth of all women-

owned firms.

• Between 2002 and 2012, the number of all women-

owned firms has grown by 28.6%, slightly more than

the 24.4% increase in all U.S. businesses. Similarly, the

number of $1M+ women-owned firms has grown by

30.7%, just over the 28.9% increase in all million-dollar

firms. But, at the highest end of sales achievement,

the number of $10M+ women-owned firms has grown

by 56.6%—fully 47% higher than the 38.4% increase

among all $10M+ firms.

• The share of firms reaching this rarified atmosphere

remains small. Within the population of million-dollar

firms, 75% have $1–$4.9 million, 12% have $5–$9.9

million, and 13% have $10 million or more in revenues.

Among million-dollar women-owned firms, 82% have

$1–4.9M, 10% have $5–9.9M, and 8% have $10M+

in revenues.

• The industries home to the greatest share of million-

dollar firms that exceed the $10M threshold include:

wholesale trade (20%), finance/insurance (12%),

transportation/ warehousing (11%), and arts/

entertainment/recreation (10%).

1 Compared to 5% of all firms, a share that has also remained unchanged since 1997.

4


Key Findings

Over the past decade, the growth in the number of women-owned firms with $10 million or more in revenues has increased by 56.6%, a rate that far surpasses that of all women-owned firms, all million-dollar women-owned firms AND all $10 million+ businesses.

• Between 2002 and 2012, the number of majority

women-owned firms with $10 million or more in

revenues increased from 8,110 to 12,700—a 56.6%

increase. During that same time period, the number

of women-owned firms with $1 million or more in

revenues grew from 116,985 to 152,900—a 30.7%

increase. Thus, the growth in the number of $10M+

women-owned firms exceeds the growth of all $1M+

women-owned firms by 84%.

All Firms

24.4

28.6

All $1M+

28.930.7

$1–4.9M

26.128.1

$5–9.9M

36.734.3

$10M+

38.4

56.6ALL FIRMSWOMEN-OWNED FIRMS

American Express OPEN/Womenable estimates as of 2012, based on previously unpublished 2002–2007 data from US Census Bureau.

% C

han

ge in

# F

irm

s, 2

00

2–

20

12

NUMBER OF $10M+ WOMEN-OWNED FIRMS UP NEARLY 57% OVER PAST DECADE

• Also between 2002 and 2012, the number of all women-

owned firms grew from 6.5 million to 8.3 million, an

increase of 29.2%. Thus, the rate of growth in the

number of $10M+ women-owned firms is nearly double

(98%) that of all women-owned firms over the past

decade AND all million-dollar women-owned firms.

• Comparing growth rates among the firms of highest

achievement finds women-owned firms again

surpassing average growth by a large margin. The

growth in the number of $10M+ women-owned firms

(56.6%) surpasses the growth in the number of all

$10M+ businesses (38.4%) by fully 47%.

47

84

98

% G

row

th o

f $10

M+

WO

Bs

vs...

GROWTH IN # OF $10M+ WOMEN-OWNED FIRMSEXCEEDS GROWTH OF OTHER FIRMS BY WIDE MARGINS

All $10M+ Firms $1M+ WOBs All WOBs


• While this remarkable growth at the high end of

business success is newly uncovered, it may not be

new. However, greater visibility for women business

owners of achievement (in the news media generally

and as recipients of awards and recognition on lists)

and more widespread networks for women business

owners (especially peer support networks for business

owners of achievement) have made it easy for growth-

oriented women business owners to find role models

and mentors, two ingredients that fuel business growth

and success.

5


The share of firms reaching this rarified atmosphere remains small. Just 2% of women-owned firms have $1 million or more in revenues, as do just 5% of all U.S. businesses. Within the population of million-dollar firms, three-quarters or more (75% of all firms, 82% of women-owned firms) generate between $1 and $4.9 million in revenues, while just 13% and 8%, respectively, meet or exceed the $10 million threshold.

• Crossing the million-dollar revenue threshold is a feat

that few U.S. firms achieve. Just 1 in 20 (5%) U.S. firms

have met or exceeded the million-dollar threshold, and

just 1 in 50 (2%) women-owned firms have scaled the

“Heartbreak Hill” of the entrepreneurial marathon.

MOST FIRMS ARE SMALL: MOST $1M+ FIRMS HAVE LESS THAN $5M IN SALES

86.6% 82%

10%

8%1.8%1.9%

9.7%

ALL WOMEN-OWNED FIRMS MILLION-DOLLAR WOMEN-OWNED FIRMS


<$500K$100–499K

$500–999K$1M+

$1–4.9M$5–9.9M

$10M+

• Within the population of million-dollar businesses,

the story is much the same—most $1M+ firms can be

found in the $1 to $4.9 million sales bracket. Fully 75%

of all million-dollar firms have between $1 and $4.9

million in revenues, as do 82% of million-dollar women-

owned firms. Twelve percent (12%) of all million-dollar

firms, and 10% of million-dollar women-owned firms,

have between $5 and $9.9 million in revenues. Just

13% and 8%, respectively, have $10 million or more in

revenues.

29

10 11

86

% S

hare

WO

B v

s. A

ll Fi

rms

WOMEN-OWNED FIRMS ACCOUNT FOR 1 IN 3 OF ALL FIRMS, 1 IN 10 $1M+ FIRMS, AND 1 IN 16 $10M+ FIRMS

All Firms $1–4.9M $5–9.9M $10M+All $1M+Firms


• Thus, the share of women-owned firms in a given

business population declines as firm size increases.

Overall, women-owned firms comprise 29% of the

business population, regardless of firm size. Women-

owned firms comprise 31% of the population of firms

with less than $500,000 in revenues. Among firms

with $1 million or more in revenues, 1 in 10 (10%) is

a woman-owned firm, and among enterprises with

$10 million or more in revenues, just 1 in 16 (6%) is a

woman-owned enterprise.

There are four industries in which the share of $10M+ firms exceeds the national average (8%) when examining the million-dollar firm population. They are: wholesale trade (20%), finance and insurance (12%), transportation and warehousing (11%), and arts/entertainment/recreation (10%).

• In the 2012 State of Women-Owned Businesses Report,

we noted that women-owned firms led sector-level

growth in seven of the 13 top industries.2 We also

pointed out that women-owned firms in wholesale

trade and accommodation/food services had the

largest share of $500,000+ revenue firms, and that

2 Those industries were, in order from widest to narrowest gap: wholesale trade, finance and insurance, other services, real estate, health care and social assistance, construction, and arts/entertainment/recreation.

6


women-owned firms in two industries—construction and

transportation/warehousing—were those standing toe-

to-toe with their industry competitors (in terms of being

equally likely to have $500,000 or more in revenues).

• In this analysis—looking within the population of

million-dollar women-owned firms—we find that

women-owned firms in wholesale trade have achieved

the highest level of firm revenues. Fully 20% of the

million-dollar women-owned firms in this industry

have topped the $10 million mark, well above the 8%

seen among all million-dollar women-owned firms.

Women-owned firms in three other industries have

also exceeded the 8% national average: finance and

insurance, in which 12% of million-dollar women-

owned firms have achieved $10M+ in revenues;

transportation/warehousing, in which 11% have passed

the $10M mark; and arts/entertainment/recreation, in

which 10% have done the same.

2

87 7

13

20

3

8

3

11

2

12

1

6

1

5

9

0 0

8

23

1

10

5

3 3

Share of WOBs w/$1M+ RevenuesShare of $1M+ WOBs that have $10M+ Revenues


All

Ind

ust

ries

Con

stru

ctio

n

Who

lesa

le

Trad

e

Reta

il Tr

ade

Tran

spor

t/W

areh

ousi

ng

Fina

nce/

Insu

ranc

e

Real

Est

ate

Prof

essi

onal

/Sc

ient

ific/

Tech

nica

l Ser

vice

s

Adm

in/

Was

te S

ervi

ces

Educ

atio

nSe

rvic

es

Hea

lth C

are/

Soci

al A

sst

Arts

/Ent

erta

in/

Recr

eatio

n

Acco

mm

/Fo

od S

ervi

ces

Oth

er S

ervi

ces

1

Per

cen

t S

har

e

WOMEN-OWNED WHOLESALE TRADE FIRMS MOST LIKELY TO EXCEED $1M AND $10M THRESHOLDS1 in 8 Exceed $1M: 1 in 5 Largest Firms Exceed $10M

• As previously noted, within this select group of

companies, growth over the past decade has been

strong, and higher than other $10M+ firms, all million-

dollar women-owned firms, and all women-owned

firms. But in which industries has growth been the

strongest? In the industries where growth has been

strongest for women-owned firms overall: health care

and social assistance and education services.

57

20

50 46 4640 42

6047

178183

18

65

-18


All

Ind

ust

ries

Con

stru

ctio

n

Who

lesa

le

Trad

e

Reta

il Tr

ade

Tran

spor

t/W

areh

ousi

ng

Fina

nce/

Insu

ranc

e

Real

Est

ate

Prof

essi

onal

/Sc

ient

ific/

Tech

nica

l Ser

vice

s

Adm

in/

Was

te S

ervi

ces

Educ

atio

nSe

rvic

es

Hea

lth C

are/

Soci

al A

sst

Arts

/Ent

erta

in/

Recr

eatio

n

Acco

mm

/Fo

od S

ervi

ces

Oth

er S

ervi

ces

%G

row

th in

# $

10M

+ W

OB

s, 2

00

2–

12

GROWTH IN NUMBER OF $10M+ WOMEN-OWNED FIRMS HIGHEST IN HEALTH CARE, EDUCATION SERVICES

• Between 2002 and 2012, the number of women-owned

firms with $10 million or more in revenues has nearly

tripled in health care and social assistance (up 182.7%)

and in education services (up 177.8%). Growth has also

been stronger than average in accommodation and

food services (+64.8%) and in professional/scientific/

technical services (+60%). Only in the other services

category (home to such disparate firms as beauty

salons, pet sitting, dry cleaners and automotive repair)

has the number of very large firms declined (down 18%).

In summary, this analysis of previously unpublished

Census data tells us that the growth of majority women-

owned firms at the highest level of business achievement

has been nothing short of remarkable—and has been

occurring under our very noses, below the “million-

dollar radar.” It makes us wonder what further economic

contributions could be measured if we took a look at the

growth and development of women-led firms—those

firms led by a woman or women whose ownership share

exceeds that of other owners, yet falls below the 51%+

government definition of women-owned. Stay tuned.

7


ACKNOWLEDGEMENTS

This analysis continues the investigation of trends in

women’s entrepreneurship provided by The State of

Women-Owned Businesses Report, published earlier this

year by American Express OPEN.

This analysis was prepared by Womenable, a research,

program and policy development consultancy whose

mission is to help improve the environment for women-

owned businesses worldwide. Womenable pursues

this mission by working with the stewards of women’s

entrepreneurship around the world—policy makers,

multi-lateral organizations, corporate decision makers,

entrepreneurial support organizations and the women’s

business community—to help elevate, implement and

improve policies and programs to support women’s

enterprise development. Learn more at womenable.com.

Both American Express OPEN and Womenable express

their gratitude to the Economic Census Branch,

Company Statistics Division of the U.S. Census Bureau

for providing the heretofore unpublished data used in this

analysis, and for their invaluable service to the women

business owner community through their quinquennial

Survey of Business Owners and its improved

dissemination through the American FactFinder web site

and Public Use Microdata Sample (PUMS).

STUDY METHODOLOGY

This report is based on data from the United States

Census Bureau, specifically their quinquennial business

census, the Survey of Business Owners (SBO), which

is conducted every five years in years ending in 2 and

7. Data from the past two Census surveys—2002 and

2007—were collated, analyzed and extrapolated forward

to 2012, factoring in relative changes in Gross Domestic

Product (GDP) both nationally and at the industry level.

Industry definitions were changed between the 1997

and 2002 censuses, so trends for this analysis can only

go back 10 years. All GDP data were obtained from the

Bureau of Economic Analysis (bea.gov), another bureau

within the U.S. Department of Commerce.

Specifically, growth in GDP from 2002 to 2007 ($10.5

to $14 trillion) was compared to that from 2007 to the

fourth quarter of 2011 ($14 to $15.1 trillion). Relative

annual growth rates were then used to estimate the

growth in the number of firms over the 2007 to 2012

period—thus bending a straight-line extrapolation

downward in keeping with slower economic growth

during the period. This was done at the national level

and by applying actual gross industry-level product

figures (which were available up to the fourth quarter of

2010). For detailed information on the 2002 and 2007

economic censuses, visit: http://www.census.gov/econ/

census07/www/get_data.html. A preview of upcoming

changes for the 2012 economic census may be found at:

http://www.census.gov/econ/census12/.

8


Trend in Number of Million-Dollar Women-Owned Firms by Industry, 2002–12*

Women-Owned Firms

% Share Among All US

Firms, 2012

% Change in # Wmn-Owned

Firms, 2002–2012

% Change in # All Firms,

2002–122002 2007 2012 (est.)

Total US

All women-owned firms 6,489,483 7,793,139 8,345,600 29.2% 28.6% 24.4%

Firms w/ $1M+ revenues 116,985 141,503 152,900 10.0% 30.7% 28.9%

$1–4.9M 97,633 116,395 125,100 11.0% 28.1% 26.1%

$5–9.9M 11,242 13,899 15,100 8.2% 34.3% 36.7%

$10M+ 8,110 11,209 12,700 6.1% 56.6% 38.4%

Agriculture, Forestry, Fishing, Hunting (11)

All women-owned firms 24,458 26,783 28,500 10.7% 16.5% 6.7%

Firms w/ $1M+ revenues 288 283 300 5.2% 4.2% 7.8%

$1–4.9M 248 253 260 5.3% 4.8% 5.3%

$5–9.9M D D D — — 23.1%

$10M+ D D D — — 24.7%

Mining (21)


Firms w/ $1M+ revenues 410 732 600 7.4% 46.3% 29.1%

$1–4.9M 303 507 400 7.5% 32.0% 28.2%

$5–9.9M D 122 100 10.0% 163.2% 24.7%

$10M+ 69 103 100 5.9% 44.9% 27.0%

Utilities (22)

All women-owned firms 2,066 3,763 1,200 7.4% -41.9% -13.7%

Firms w/ $1M+ revenues 59 70 100 6.3% 69.5% -12.4%

$1–4.9M D D D — — -14.8%

$5–9.9M D D D — — 7.5%

$10M+ D D D — — -14.5%

Summary Tables

* Sources: 2002–2007, US Census Bureau; 2012, American Express OPEN/Womenable estimate.

D=Numbers too small (<50) and therefore not disclosed.

9



Women-Owned Firms


Firms, 2012


Firms, 2002–2012


2002–122002 2007 2012 (est.)

Construction (23)



$1–4.9M 10,813 14,019 12,000 8.2% 11.0% 10.5%

$5–9.9M 1,337 2,178 1,700 8.4% 27.2% 16.9%

$10M+ 833 1,316 1,000 5.3% 20.0% 17.1%

Manufacturing (31–33)


Firms w/ $1M+ revenues 11,640 11,442 11,600 9.2% -0.3% 0.2%

$1–4.9M 8,365 8,099 8,400 10.6% 0.4% -0.1%

$5–9.9M 1,623 1,562 1,600 8.6% -1.4% 0.2%

$10M+ 1,652 1,781 1,700 6.2% 2.9% 0.9%

Wholesale Trade (42)



$1–4.9M 11,512 11,938 12,200 11.5% 6.0% 3.4%

$5–9.9M 2,628 2,642 2,600 8.4% -1.1% 11.7%

$10M+ 2,401 3,149 3,600 6.8% 49.9% 29.6%

Retail Trade (44-45)

All women-owned firms 944,682 918,804 913,600 34.0% -3.3% 4.1%


$1–4.9M 19,106 20,706 21,000 11.5% 9.9% 10.3%

$5–9.9M 1,749 2,112 2,200 7.3% 25.8% 35.7%

$10M+ 1,439 1,951 2,100 6.1% 45.9% 15.2%

Transportation and Warehousing (48–49)



$1–4.9M 2,840 3,617 3,400 10.6% 19.7% 28.6%

$5–9.9M 375 561 500 8.6% 33.3% 48.6%

$10M+ 392 477 500 6.8% 27.6% 16.2%


10



Women-Owned Firms


Firms, 2012


Firms, 2002–2012


2002–122002 2007 2012 (est.)

Information (51)



$1–4.9M 1,582 1,677 1,700 10.9% 7.5% 13.9%

$5–9.9M 203 200 200 7.4% -1.5% -0.3%

$10M+ 221 206 200 4.1% -9.5% 8.8%

Finance & Insurance (52)



$1–4.9M 2,428 2,611 2,700 7.5% 11.2% 21.3%

$5–9.9M 304 274 300 4.7% -1.3% 5.9%

$10M+ 285 380 400 3.4% 40.4% 19.7%

Real Estate, Rental, Leasing (53)



$1–4.9M 4,463 4,909 4,800 12.7% 7.6% 10.2%

$5–9.9M 321 431 400 8.9% 24.6% 22.0%

$10M+ 211 307 300 5.7% 42.2% 11.2%

Prof/Sci/Tech Svcs. (54)

All women-owned firms 934,851 1,096,614 1,154,800 29.1% 23.5% 21.2%


$1–4.9M 10,099 13,263 14,400 11.9% 42.6% 38.9%

$5–9.9M 809 1,244 1,400 9.5% 73.1% 40.3%

$10M+ 500 750 800 5.1% 60.0% 34.8%

Management of Companies (55)

All women-owned firms 2,100 1,791 1,700 6.4% -19.0% -6.9%


$1–4.9M 458 380 400 11.4% -12.7% -25.6%

$5–9.9M 228 338 400 14.3% 75.4% -8.9%

$10M+ 587 662 700 4.3% 19.3% 10.2%


11



Women-Owned Firms


Firms, 2012


Firms, 2002–2012


2002–122002 2007 2012 (est.)

Admin, Support, Waste Svcs (56)



$1–4.9M 6,135 7,770 7,500 16.9% 22.2% 25.8%

$5–9.9M 797 1,095 1,000 15.4% 25.5% 28.3%

$10M+ 546 799 800 9.5% 46.5% 23.1%

Educational Svcs (61)



$1–4.9M 931 987 1,100 9.3% 18.2% 23.7%

$5–9.9M 90 77 100 4.2% 11.1% 32.8%

$10M+ D 75 100 2.4% 177.8% 80.1%

Health Care & Social Assistance (62)



$1–4.9M 8,508 13,167 22,000 13.8% 158.6% 84.9%

$5–9.9M 641 924 1,500 7.2% 134.0% 95.5%

$10M+ 283 476 800 3.8% 182.7% 108.5%

Arts, Entertainment & Recreation (71)



$1–4.9M 1,508 1,606 1,600 8.5% 6.1% 23.7%

$5–9.9M 96 138 100 4.0% 4.2% 37.5%

$10M+ 85 133 100 4.2% 17.6% 31.7%

Accommodation & Food Svc (72)



$1–4.9M 6,278 8,284 8,800 11.5% 40.2% 41.9%

$5–9.9M 322 414 400 7.3% 24.2% 40.4%

$10M+ 182 286 300 5.6% 64.8% 38.9%


D=Numbers too small (<50) and therefore not disclosed.

12



Women-Owned Firms


Firms, 2012


Firms, 2002–2012


2002–122002 2007 2012 (est.)

Other Services (81)



$1–4.9M 2,855 3,387 3,400 10.0% 19.1% 21.5%

$5–9.9M 123 146 100 4.5% -18.7% 25.5%

$10M+ 122 112 100 3.7% -18.0% 8.4%


13


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Documents

commissioned by American Express OPEN.…his report was commissioned by American Express OPEN and published in March of 2013. The information contained in this report was prepared