The Role of Social Capital and Human Capital in the Growth of Women-Owned Enterprises in the United Kingdom

Abstract

Research investigating women-owned businesses has developed considerably over the past two decades. There are, however, few British studies that have specifically focussed on growth oriented women-owned businesses. The current study aims to fill this gap. Its purpose is to explore the effect of social capital and human capital on the growth of women-owned enterprises in the UK. The research contributes to the knowledge of women’s entrepreneurship as the first to study the moderating role of human capital in building and using social capital in the UK. It develops the theoretical premise that women entrepreneurs with higher human capital gain credibility and centrality in networks, accumulating social capital based on their importance for other network members and their business stakeholders. This mixed method study involves both collecting and analysing quantitative and qualitative data. Statistical analysis using SPSS was applied to analyse quantitative data collected through 517 on-line completed questionnaires from three different regions. The qualitative data collected through face to face interviews with 42 women entrepreneurs were also analysed and interpreted. The findings suggest that the social capital possessed by women entrepreneurs plays an important role in the growth of enterprises. Women entrepreneurs use different sources to build and use their social capital at different stages of growth and in different industry sectors such as manufacturing or services. Women entrepreneurs with higher human capital are more likely to identify opportunities, generate ideas and show creative thinking in introducing novel products, services, location, processes or systems, which makes their growth path exponential. There are implications of this study for women entrepreneurs to build and use their social and human capital for the growth of their enterprises. And there are also implications for politicians and business organisations, who must devise policies to develop opportunities for existing or potential women entrepreneurs for building their human based capital.