The largest businesses owned by women had a hand in nearly all of L. A. County’s major industries, racking up $18.9 billion in revenue in 2017.
The total for the top 100 women-owned companies that make up this week’s Business Journal’s list came to a 1.8 percent hike on sales from the prior year.
More than half – 58 – of the companies listed saw increases in annual revenue, while 24 posted declines for the year, five reported flat sales, and 13 were kept even based on Business Journal estimates.
The combined rate of sales growth for the women-owned businesses lags the combined performance of companies on the Business Journal’s recent list of the 100 largest minority-owned businesses, a group that climbed to $18.7 billion in revenue in 2017 thanks to a 6.4 percent cumulative increase from a year earlier.
The women-owned businesses, defined by those with at least 50 percent female ownership, remain skewed toward professional business services, including staffing and advertising firms, entertainment and other creative sectors.
The financial and technology sectors are scarce on the women-owned business list. Investment firm Levine Leichtman Capital Partners in Beverly Hills – which ranks No. 7 and is 51 percent owned by Chief Executive Lauren Leichtman – was the most prominent of a handful of entries from the financial sector on the list.
Four of the 100 companies are technology enterprises. They include IT service providers – No. 10 Dynamic Systems Inc. in El Segundo and No. 12 GST Inc. in Cerritos – as well as staffing firms specializing in IT, such as No. 20 El Segundo-based RJT Computers Inc. and No. 31 Beverly Hills-based TechLink Systems Inc. That’s compared to staffing and advertising/marketing/public relations firms, of which there are about 12 each.
The comparatively small number of women-owned businesses in tech on the list doesn’t come as a surprise to experts despite the growth of Silicon Beach as a major tech hub in the last five years.
“Tech has historically been and still is a male-dominated field,” said Susan Harmeling, associate professor of clinical entrepreneurship at USC’s Marshall School of Business. “Attitudes from cultural, social and familial expectations of women, and the discouragement young girls’ face in STEM fields has resulted in what we see today.”
The top three businesses were co-founded by women and their spouses. Lynda Resnick’s Sawtelle-based Wonderful Co. is ranked No.1 on the list with $4.2 billion in revenue, a 12 percent decline year over year. Next is Jin Sook Chang’s Forever 21 Inc. in Lincoln Heights with $4 billion in revenue, an increase of 17.7 percent compared to 2016 and third on the list is Peggy Cherng’s Panda Restaurant Group based in Rosemead, clocking in with $3 billion in revenue, up 3.3 percent year over year.
Resnick spoke to the Business Journal in May about the importance of finding the right business partner.
“There doesn’t have to be a man; you just have to know what your strengths are,” she said. “He [Mr. Stewart Resnick] could have been a woman; he could have been a monkey. He’s brilliant with numbers…I am more the creative force in our union, and he is more the business-savvy force.”
A 2016 report on gender and entrepreneurship by the Kauffman Foundation, a nonprofit based in Kansas City, Mo., found that women-owned businesses tend to be smaller on average and financed at lower rates.
“This is a big problem particularly in tech,” said Jesse Draper, a venture capitalist and founder of Halogen Ventures based in Santa Monica, referring to the lack of financing.
Access to capital is a big factor, as men generally control majority of venture capital, she said. Draper founded Halogen in 2016, an early-stage venture capital fund focused on female founded tech companies. The company closed a $10.4 million round last year and counts 40 portfolio companies under its umbrella.
Jesse Draper is fourth-generation venture capitalist as the daughter of Tim Draper, a renowned Silcom Valley investor. She said she has encountered women billionaires hesitant to invest in Halogen but would “gladly sign away millions to charity,” she said.
But L.A. is friendlier to women in tech compared to Silicon Valley, Draper added.
“There are more female investors and more female founders here,” she said. “Up north, all of the traditional venture funds don’t have a female founder or assistant. That’s a problem.”
Investing in women should be more than a trend, Draper said, because “it should always be incredible to invest in a company that has a great product and happens to be run by a woman.”
Some local venture capital funds that have invested in women-led businesses include Santa Monica-based Upfront Ventures and Venice-based Crosscut Ventures.
Arianna Eisenberg made a career switch into entertainment after a short-lived stint as a broadcast journalist in the early 1980’s. In 2003, she started her own film production company, No. 16 Aegis Film and Television Group based in Hollywood. She now counts 25 employees on her payroll and recorded $62 million in 2017 revenue, a 5.9 percent increase year over year.
Eisenberg, who is a writer, screenwriter and post-production editor, is in the process of securing funding for a movie adaptation of her first book, “Jemiyah Jones and the Kingdom of Nir,” which she wrote in 2014. She’s waiting to get confirmation of a pending $100 million from investors, she said.
Eisenberg said that while entertainment was particularly tough for women entrepreneurs, the Me Too movement has helped improve the situation from what it was 15 to 20 years ago.
“I would urge women to speak up, and I have always pushed back when I’ve dealt with issues like that,” she said. “But women do feel intimidated in speaking up because there is a real fear of losing their jobs and being blackballed in an industry which is still run heavily by men.”
USC’s Harmeling said that things were improving.
“There’s a little more awareness, more nuanced ways women are portrayed and more awareness of biases these days, especially with the younger generation,” Harmeling said. “It’s baby steps and we’ve come far, but we still have a long was to go.”
For reprint and licensing requests for this article, CLICK HERE.
Stories You May Also Be Interested In
- Women & Wealth
- Silicon Beach Report March 30: Female-Focused Venture Fund Raises $10.4 Million
- Silicon Beach Report May 22: Openpath Launches with $7 Million Raise
- L.A.’s Edge; Kareem’s Socks; Tortilla’s Twist?
- Women’s Businesses Climb 7% to $19.2 Billion
- List Story
- Fledgling VC Outfit Takes Flight
- Dating App Exec Puts Power in Women’s Hands