Running a company is no easy feat, and it can be even more complicated when encountering biases in different parts of society like women entrepreneurs often do.
There are many tools and opportunities ut there that can make the life of entrepreneurs much more manageable but access and use them optimally. The entrepreneurs need to know what is necessary for the company’s success and when to take specific actions.
A key area of knowledge is financial literacy, defined by Investopedia as “the ability to understand and effectively use various financial skills, including personal financial management, budgeting, and investing”.
For entrepreneurs, it is a vital skill. It can help project incomes and expenses, associate costs with revenue and evaluate which projects and investments are profitable and which are dragging back operations. In addition, it allows entrepreneurs to see hidden costs, like the necessary investment to have a functional sales funnel.
The lack of financial literacy can quickly slow down a company’s growth and make it compete at a disadvantage with other market actors. While this is an issue for all entrepreneurs, it can be even more daunting for women entrepreneurs as they face more significant difficulties in securing funding sources, so managing budgets adequately becomes even more of an absolute priority.
The Investopedia definitions can provide an excellent introduction to all women who wish to learn more. You can then visit the website of the EU-financed project FIT that aims precisely to support and improve the financial literacy of women entrepreneurs in Europe: https://the-fitproject.eu/
Finally, there are several online resources with stories and reports that can help delve deeper into specific topics; Some examples are:
- This FORBES article on financial literacy and women entrepreneurs: https://www.forbes.com/sites/stephanieburns/2021/11/15/financial-literacy-is-crucial-for-female-entrepreneurs/?sh=7c3f15ee1924
- The ACCA (the Association of Chartered Certified Accountants) report on financial education for entrepreneurs: https://www.accaglobal.com/content/dam/acca/global/PDF-technical/small-business/pol-tp-fefe.pdf
- The European Entrepreneurship Education NETwork (EE-HUB) report on sharpening financial education: http://jaeurope.org/index.php?option=com_attachments&task=download&id=354:Final_Education-Report-web
- The OECD/INFE core competencies framework on financial literacy for micro, small, and medium-sized enterprises: https://www.oecd.org/finance/financial-education/OECD-INFE-core-competencies-framework-on-financial-literacy-for-MSMEs.pdf
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