COVID-19 Disproportionately Impacted Women. This Loss Could Have a Big Ripple Effect On Our Economy

 COVID-19 Disproportionately Impacted Women. This Loss Could Have a Big Ripple Effect On Our Economy

By Cate Luzio

COVID-19 is disproportionately impacting women and people of color. The National Bureau of Economic Research estimates that the pandemic has already eliminated 25% of women-owned businesses. As revenues and profits dwindle on average for these businesses, the pandemic will further increase gender inequality in ownership and broaden economic disparities and create what some are calling a “shecession.

Some early-stage businesses such as female-centric coworking spaces are struggling to stay open, and this will have a broader impact. With no path forward, these women-focused communities are shutting down, and women are yet again being shut out.

Between 2016 and 2019, women-focused communities were opening up all over the world particularly in the form of physical spaces. From the Wing in New York City to the Riveter in Seattle, the Assembly in San Francisco to the Broad in Richmond, and dozens in between, they provided women access to remote workspaces and, more importantly, access to communities of like-minded individuals to connect, learn, and simply expand their networks. The proof of concept for this new model was there and had the potential to impact millions of women. And until March 2020, the runway of growth for these communities seemed unstoppable.

This is personal for me as the founder of Luminary, a physical space and global community built on advancing women in the workforce through programming, connection, and support. The pandemic brought on challenges that no one could have predicted, and I found myself having to temporarily close our doors and pivot our business completely online.

Since Luminary opened its doors, I began growing a network of women’s partner spaces around the country with reciprocal benefits for our respective members. This experience brought me closer to dozens of founders as we grappled with the unique challenges that accompany running communities anchored by physical spaces. Faced with mounting rents and staff now working remotely, these membership spaces saw their entire business model hit a standstill while revenues hit unconceivable lows.

While many of these communities also offered digital programs and platforms of some sort, their physical spaces allowed people to meet face-to-face, gather for events, and work outside their homes. Although I was able to reopen Luminary, so many of our partner communities and other spaces around the country weren’t able to survive the virtual reality we are living through. Now, there’s the ripple effect as some of these essential spaces and communities close their doors forever.

“The Emery was a lifelong dream of mine. I have always enjoyed helping others, and the Emery allowed me to do so on a grand scale,” said Aileen Lavin, founder of the South Florida-based community. “I loved that we were making a positive impact in the community and helping so many women [with] the opportunity to find both personal and professional success,” she said. Lavin launched the Emery in early 2019 with financial support from her parents as well as her own funds. Unfortunately, as a result of COVID-19, the Emery was forced to close. “It was no longer practical to maintain a business whose success was contingent on large physical gatherings,” Lavin said.

Regardless of how prepared any small-business owner was for an economic downturn, there are only so many levers to pull in a business plan to deal with the devastation of COVID-19. Despite many women’s communities pivoting to virtual events, the blow to revenue that comes from memberships and in-person events has been too great to sustain. “COVID-19 crushed our business model,” said Ali Greenberg, founder of the Broad workspace and social club in Richmond, Virginia.

The Broad was self-funded and opened in 2018. “As a space built on in-person connections, a shift to digital was a good Band-Aid but not an effective long-term solution for us,” she explained. Although the Broad was profitable within three months of opening and continued to grow until the pandemic hit, Greenberg made the decision to permanently close in June. “The changes we would have had to make to our model to reopen would have changed everything about what our business set out to be,” Greenberg said.

The Broad is not alone in closing. The Riveter, which had expanded rapidly to nine spaces with plans to add more locations across the country, announced it was closing all of its existing spaces at the end of June and moving completely online. The Wing temporarily shut down its 12 (and counting) spaces in February and has yet to reopen. While businesses like the Riveter and the Wing had tens of millions of venture capital dollars behind them, the majority of community women’s spaces, such as Luminary and the Broad, are bootstrapped.

Denver’s Charley Co., founded by Bryn Carter, announced in May that it was closing permanently less than a year from the time it opened. “When 2020 started, I was excited to see where Charley’s was going,” Carter recalled. “Our memberships were growing, and events in the space were booked out months in advance. We had so many plans and ideas for our community,” said Carter. But the pandemic’s impact was too much for the start-up community to bear. Overnight, almost all of the company’s revenue dried up. Carter put memberships on hold and pivoted online for a cheaper monthly rate. “I loved the community that was built, and all the incredible women I met because of it,” she explained. “However, gathering spaces are not doable in our current state, and as a small, independently owned business, there was no way I could keep it afloat.”

Read more

Originally posted on Fast Company

Kanarys

Leave a Reply

Your email address will not be published. Required fields are marked *