This is the first in a four-part series examining the changing economics of women’s entrepreneurship during National Women’s Small Business Month.

Women’s entrepreneurship has reached a point where the way we measure progress needs to change.

According to the U.S. Census Bureau , women owned 14.2 million U.S. businesses in 2023, generating approximately $2.8 trillion in receipts. Women also owned approximately 1.4 million employer firms, representing 22.9% of all U.S. employer businesses.

A separate Census analysis of business ownership trends found that women-owned employer firms increased nearly 20% between 2017 and 2023, while minority women-owned employer firms grew 49.8% during the same period.

Those numbers represent substantial progress. As National Women’s Small Business Month brings renewed attention to women entrepreneurs this October, it is also an opportunity to look beyond how many businesses women own and examine what happens to those businesses after they are started.

From business ownership to business growth

One indication can be found in the difference between employer and nonemployer businesses. Women owned 42.3% of U.S. businesses without employees in 2023 but only 22.9% of employer businesses, according to the Census Bureau.

There is nothing inherently unsuccessful about building a business without employees. Many entrepreneurs intentionally operate profitable companies with small teams or no employees at all. Still, employment remains one measure of economic impact, and women-owned employer businesses already have a significant one: they employed approximately 11.1 million workers and generated roughly $523.8 billion in annual payroll in 2023.

Revenue provides another measure. The Federal Reserve Banks’ 2026 Firms in Focus: Gender of Ownership , based on the 2025 Small Business Credit Survey, shows women-owned employer firms concentrated more heavily in lower revenue categories than men-owned firms. Twenty-nine percent of women-owned firms surveyed reported annual revenues of $100,000 or less, compared with 15% of men-owned firms.

At higher revenue levels, the difference widens. Twenty percent of women-owned employer firms reported revenues exceeding $1 million, compared with 38% of men-owned firms. Only 2% of women-owned firms reported more than $10 million in annual revenue, compared with 7% of men-owned firms.

That is where the conversation about women’s entrepreneurship needs to expand. Business formation remains an important measure of economic participation, but it does not tell us whether businesses are increasing revenue, employing people, generating profits or creating long-term wealth.

Growth doesn’t always mean financial strength

There are encouraging signs. Forty-two percent of women-owned employer firms surveyed by the Federal Reserve reported increasing revenue during the previous 12 months, and 60% expected revenue to increase during the following year.

But growth and financial strength are not necessarily the same thing. Only 37% of women-owned employer firms reported operating at a profit, compared with 53% of men-owned firms. Nearly two-thirds of women-owned firms described their financial condition as fair or poor, according to the Federal Reserve’s gender-of-ownership data .

Those numbers complicate a narrative that measures progress primarily through business formation.Women are starting businesses, and many are growing their revenues, but women-owned employer firms remain disproportionately concentrated in lower revenue categories and report lower profitability than men-owned firms.

The reasons are unlikely to be explained by any single factor. Firm age, industry, access to capital, operating costs, business networks, customers and other conditions can all influence how a company develops. Women-owned firms in the Federal Reserve survey were also somewhat younger than men-owned firms, an important consideration when comparing revenue and profitability.

Understanding those factors matters because women-owned businesses are no longer a small corner of the American economy. They represent millions of companies, trillions of dollars in economic activity and millions of jobs.

Measuring the next chapter

The rapid growth of women-owned businesses, particularly minority women-owned employer firms, represents a significant shift in the American business landscape. But the next chapter of women’s entrepreneurship should be measured by more than how many businesses women start. Revenue, profitability, employment, longevity and wealth creation provide a broader picture of what business ownership ultimately produces.

Understanding what determines those outcomes also requires looking at the economic environment surrounding women entrepreneurs. The remaining articles in this series will examine three parts of that environment: whether the data we use to understand women-owned businesses are keeping pace with today’s economy; whether the entrepreneurial ecosystem, including capital and business-support infrastructure, is meeting their needs; and whether women-owned businesses have access to customers and markets capable of supporting meaningful growth.

Women have demonstrated that they will start businesses. The next measure of progress is what happens after they do.