Too Little, Too Late: The Need for Better Legal Protection for Women Owned Businesses
One of the great things about having my own firm is that I get to work with all sizes of businesses, from startup/early-stage businesses to large multi-national corporations. As many folks know, I have a passion for women owned businesses – whether in law or outside of it. Over the last few years, I’ve worked with small businesses across a number of industries – food and beverage, fashion, consumer products, professional services, technology, etc. – some owned by women, some by men. One thing that has interested me is when and to what extent small business owners are willing to invest in legal services, especially intellectual property protection. I’ve also noticed a frankly disturbing trend – businesses owned by men or who have a man on the leadership team are more willing and ready to invest in these kinds of legal protection services than women. Although many women owned businesses have talked with me about potentially investing in legal protection, most of them end up deferring the projects – whereas men hire me, pretty much, right away.
As I thought about it, my experience is also consistent with what others who counsel business owners have told me. For example, when Fran Griesing and her team started what is now called Bossible (formerly Stiletto Savvy), they thought that they would be focusing on providing marketing and related services to women owned businesses – instead they found that more men were hiring them than women. I’ve also been studying trends in women’s patenting, which has been a hot topic this year for the USPTO and Congress. Notably, while the numbers of women in STEM fields still needs improvement, their patenting numbers fall far short of it and do not explain the patent gender gap. At least one study by the National Bureau of Economic Research quantified this trend, noting that only 7% of the gender gap in patenting is accounted for by the lower share of women with any science or engineering degree while 78% of the gap is explained by lower female patenting among holders of a science or engineering degree.
Interested in pursuing this further, I thought I’d speak to a few folks who focus on helping women owned businesses about this potential trend. Thus, I asked my own business coach, Kimby Berger of Her Corner about this and she said they have noticed this hesitancy from her clients as well – women agonize over every single business investment whereas men seem to decide to invest a chunk of money in the business and don’t think twice about it. I also spoke to the folks at WBEC-East, the Philadelphia regional chapter of WBENC, the largest certifier of women owned businesses, and they report seeing many women owned businesses coming to them who haven’t formed entities or obtained the necessary business licenses, let alone invested in lawyer drafted contracts or IP protection. Given this, WBEC-East has created the JumpStart Series and FastTrak program (several of which I’ve taught at) which cover these issues. However, I’ve noticed that at the WBENC national conferences, there are lots of programs educating women on marketing, business planning, the intricacies of government contracting, and the like, but there were no programs on the importance of legal protection.
Of course, I’ve seen plenty of male business owners who have written their own agreements (or gotten them off the internet) or filed for IP protection on their own and many women business owners do invest in legal protection; however, the gender disparity is clear. There could be a lot of reasons for it, not the least of which that male owned businesses are better funded and have more access to capital that they can use to invest in this kind of protection. But fundamentally, I believe we need to do a better job of educating women business owners on the risks of not properly protecting their businesses and the advantages to having a stronger legal foundation from which to grow.