In many developing countries, there are lots of people starting their own businesses. More than half of all workers in these growing markets, both men and women, run small businesses.

Sadly, many of these entrepreneurs struggle to make a decent living. And for women, it’s even harder because of a gap between men and women that keeps getting in the way of success.

Entrepreneur support

To help out, governments and charities spend a ton of money each year on training programs. These programs often include mentors who guide and support entrepreneurs. But here’s the catch: female entrepreneurs usually don’t benefit as much or sometimes not at all from these programs.

A new study from the University of Notre Dame, Texas A&M, University of Chicago, and London School of Economics suggests a simple change to make things better for women. The study looked into whether the gender of the mentors makes a difference and found that it doesn’t matter for men. However, when female mentors were matched with female entrepreneurs, it made a big difference.

The study involved 930 entrepreneurs in Kampala, Uganda. About 40% of them were women, and they were randomly matched with a female mentor, a male mentor, or no mentor at all. The mentors, recruited by Grow Movement from around the world, worked with the entrepreneurs remotely for several months using video calls, phone calls, texts, and shared documents.

Female mentors

Two years later, a follow-up survey showed that female entrepreneurs in developing markets benefitted a lot more when they had a female mentor instead of a male one. Why? Female mentors turned out to be more positive and social in their interactions with female entrepreneurs, showing they were more engaged. The study revealed that women with female mentors learned to build better relationships with customers. For example, they started checking in after a purchase to ask about their customers’ experiences and how things could be improved.

“This really helped improve their firms’ performance,” the researchers explain “Our findings show that firm sales and profits of female entrepreneurs guided by female mentors increased by, on average, 32% and 31% compared with the control group. And these estimates are even greater for high-aspiring female entrepreneurs.”

On the flip side, when we look at the group that didn’t have any mentorship (the control group), there wasn’t a significant improvement in sales and profits for female entrepreneurs mentored by men during the study. These findings highlight a straightforward but impactful new approach that can be used as a policy tool.

“We have already shared our findings with several organizations, including some of our contacts at the World Bank who frequently design business support interventions delivered in emerging markets, many of which involve some kind of mentor,” the authors conclude. “We hope that female emerging market entrepreneurs will get paired with female mentors in the future, which, based on our findings, should help to break the glass ceiling and improve business outcomes.”