The United States Small Business Administration was established after World War II with the goal of helping small businesses participate and thrive in our economy. Today, the SBA connects business owners with financing and education. Since its inception, the SBA has enabled millions of loans, and countless business counseling, training, and mentorship sessions across many groups and dozens of district and regional offices.
Kathleen McShane is the Assistant Administrator and the proud leader in charge of overseeing the SBA Women’s Business Centers throughout the country. According to the SBA, the WBC mandate is to “provide advice, assistance and support to promote, coordinate, and monitor the efforts of the Federal government to establish, preserve, and strengthen women-owned business.”
Formerly the CEO and Founder of Ladies Launch Club, an organization dedicated to providing mentorship and education for female entrepreneurs, McShane has devoted much of her life and career to promoting and supporting the economic activities and power of American women.
As an SBA leader, she has been well-positioned to continue that work and to comment on the changing landscape for women in business and entrepreneurship today. In a recent phone call, she shared her perspective with us on what has and has not changed for women at work, and her hopes for how the SBA can continue to support women in the future.
Fundbox: The business landscape is always changing. In 2019, what is your top advice for women who want to not just grow their businesses but truly thrive in environments or industries where female leadership may not be the norm?
Kathleen McShane: If you asked me that question 10 years ago, I’m sorry to say the answer would be pretty much the same.
A lot has changed in terms of support for women who want to launch or expand a business, but a lot has not changed in terms of the biases that are associated with women and the fact that women really don’t have the access [to capital] that they need.
When I talk this way, I’m speaking generally, [from my experience]. I also believe that women haven’t changed enough in terms of how we see ourselves.
As much as it has to do with [gender] bias [in business], a lot of it has to do with the way women approach business, which is totally different from how men approach it. That doesn’t mean that one approach is right and one is wrong. It simply means that women approach things differently.
For example, we find that many women don’t typically go into business explicitly to make a lot of money, whereas men [will say they] go into business to make money. It’s clear that that’s what they want to do.
What a Lack of Confidence Costs
Fundbox: What is so different about how the women you see approach business?
KM: With many women, their confidence level can be lacking. [In my experience at the SBA], we think anecdotally that Women’s Business Center (WBC) programs can increase their confidence. We do a study every year because we’re instructed by Congress to talk about what we’ve done and what the outcomes have been, and I included a question about confidence.
In our recent study, 76 percent of women strongly agreed or agreed that going through services that are women-centered increased their confidence. [Editor’s note: According to a representative for the SBA, this survey was internal and has not been published.]
Confidence affects our success. For example, some women don’t think of themselves as worthy, which keeps them from charging properly for their services. I say, “If you don’t have enough confidence to charge me properly, why should I have confidence in you to hire you?”
One of the things that we worked on in [my former company] the Ladies Launch Club, was to really begin to shift the mindset.
When women work with other people to increase their confidence, when they’re willing to go into a mastermind group or peer to peer advisory group, and have others challenge them, and not feel defeated afterwards, that goes a long way.
Positive Psychology as a Crucial Tool
Fundbox: You have been trained in positive psychology. Do you recommend women business owners look into this as a way of shifting their mindset?
KM: Absolutely positively, women should take positive psychology, and that doesn’t mean you have to go to Penn as I did.
I was actually going to start a business running positive psychology workshops, that’s why I did it. I’ve actually been considering putting some curriculum in our WBCs that actually addresses positive psychology. It almost makes me want to start another business because it gives me goosebumps.
It is so amazingly powerful in terms of shifting the mindset. It’s a way for you to look at the world in a different fashion. We tend to internalize, women especially. We think things are always our fault.
The protocol that one uses in positive psychology stops you, and you’ll ask yourself questions. “What is this triggering in me? What do I do to stop it?”
When you start thinking about these things, seeing those barriers becomes much more obvious, so you can act with intention.
Training, Mentorship, and What Women Gain at the WBC
Fundbox: Your work with the SBA and the Women’s Business Centers is specifically focused on training and providing mentorship to women. What can female entrepreneurs gain from working with the centers?
KM: There are a number of things that they can gain. One is that confidence factor that I pointed out. From that same study I mentioned, 91 percent of respondents said that they would recommend a WBC.
What women walk away with is what I describe as technical training. That includes [things like], how do I market a product or a service? How do I use social media? How do I use QuickBooks or any of those services that are out there? How actually do I write an application to get funding?
We work with women to help them with all of these tactical things.
We also offer a secure environment for women to be really challenged and not feel as if they are failures. Again, that requires a whole mindset shift. Mastermind programs are unbelievable because that really makes a woman accountable. They’re given homework and they’ve got another five or six women in that program to provide a support system. They’re not going to come back not having accomplished that homework.
The peer-to-peer advising is really powerful because generally, people who have different experiences come from a totally different point of view. The fuzziness is diminished because somebody will say, “Wait a minute, that doesn’t make a bit of sense to me.”
Some of our centers are actually testing matching women with mentors. Those mentors deliver two things. One is that counseling, but they also become role models. Women don’t have a ton of role models. This matching addresses that.
Fundbox: Why are mentoring and matching so important? What impact do you believe that they will have?
KM: Again, women often don’t have mentors. When they decide to launch or expand a business, they really feel that they’re all alone. Many do not know where to go to get help. If they have a mentor that says, “There are three or four or seven organizations out there that you should look into. Or of those seven that are out there, this, given what your challenges are, is the best for you,” that is extremely powerful.
Those mentors will also challenge those women and they’ll challenge in a very positive way, which allows the woman to get clearer in terms of her business proposition.
Fundbox: What’s the SBA attitude toward promoting and supporting women in entrepreneurship generally?
KM: The attitude of the organization is very much to support entrepreneurs. Administrator McMahon has a certain loyalty to female entrepreneurs because she was one. She knows what it was like. My group, the Office of Women’s Business Ownership, is solely focused on women.
Having said that, if a man does want to go through the program, of course, we would accept them. The other SBA groups are more focused on where a business is in its life cycle.
Fundbox: When it comes to firms in the financial industry, financial technology firms like Fundbox or others, what do you think these firms can do or should be doing to help promote financial inclusion, especially among women business owners?
KM: I think the first thing is awareness. How do I make sure that my centers are aware of people like you that are out there?
I love the idea of your project, [the What If whitepaper on the gender credit gap]. It’s more important because it is educational. I want to send [information about this] to all my WBCs so that they become educated about what’s out there.
We have over 100 centers throughout the country. We plan to, in early 2019, open more. We’re committed to helping. However, we like the idea of working with other people who have great expertise in areas that perhaps my centers don’t, and are willing to educate my centers in terms of what is available.
About Women’s Business Centers
Women’s Business Centers (WBCs) represent a network of over 100 centers throughout the U.S. and its territories. The WBCs are designed to assist and educate women in starting and growing businesses. WBCs seek to “level the playing field” for women entrepreneurs, who still face unique obstacles in the business world.
SBA’s Office of Women’s Business Ownership (OWBO) oversees the WBC network, which provides entrepreneurs (especially women who are economically or socially disadvantaged) comprehensive training and counseling on a variety of topics in several languages.
To learn more about the OWBO and to locate WBCs by state, visit the SBA website.
To learn more about SBA loans for funding your small business, how to apply and more, visit the SBA or our guide to SBA loans.
This interview has been edited for length and clarity.