Why do women in business avoid paying themselves?

What is success for women in business if it isn’t being able to make enough money to make a livelihood?

Yet why do women in business avoid paying themselves for their work?

It’s a puzzling notion that women who run small businesses, startups and bootstrap their blogs into communities aren’t taking the time to give themselves a living wage. After all, isn’t the whole idea behind work and having a business to make money from it?

Yet a study by the Australian Women’s Chamber of Commerce and Industry found only 37% of women pay themselves a market wage. In fact, the majority of women in business aren’t paying themselves at all. We’re launching ideas with personal savings or via debt through credit cards and loans. We start in debt, with less than $7000 on average to our name, and forget to pay ourselves 50% of the time.

No wonder we still struggle to be taken seriously in business. It’s an attitude that is counter-productive to success and holds many of us back from reaching our full business potential.

Money isn’t bad. It’s our lack of respect for it that creates the problem.

It isn’t an optional extra when it comes to business. You either make money, or you’re out of business.  There isn’t an option C.

Here’s why women in need to pay themselves for the work they do

Women in business for the long haul

If you have loans and credit cards paying for your business expenses, one day you’ll need to pay that debt back, and with interest. If you want Angels to invest in your startup, you’ll need to demonstrate you have a plan for making the money back in the future to qualify. They are after all, investors chasing a return on their money.

Even if you are backing yourself with your own savings or supplementing income through other work endeavours, there is only so much money you can draw from these situations before they run dry.

When you deal with the reality of “where is the money going to come from to pay that bill?” on a personal level, you are more hungry and realistic about what you need to do. There’s no big fluffy cushion of money. There’s just you, your business, and “how the heck will I pay the rent this month?”

How liberating!

It means you have more than debt to show for your failures and your wins are your own. Plus it spurs you on to be more creative and applied in the things you do. And it makes saying no to stuff that isn’t a priority much, much easier.


Realism relies on you paying yourself 

It pains me to see women in business stumping up tens of thousands of dollars for business courses when they barely have a business.

Each time I see a beautiful bunch of samples and freebies flying around, I manually calculate the cost and ask “is this event worth that?”

When early stage women in business  are talking in terms of their busy social calendar as a benchmark of success, I become concerned.

Keeping up appearances at conferences and handing out your business cards to your peers instead of customers makes no sense and no money. Samples are great, but only if they are paid for by profit and have return on investment clearly marked in the column next to ‘outgoings’.

It costs money to expand, to market, advertise, staff and service a business, no matter the model. If you don’t know how to handle money properly, things will get very wobbly, very quickly.

Sure, those samples and those photos from the conferences look great in the office, but what’s the point if you still have no customers?

It seems counter-intuitive to pay others to service your business when you fail to ensure your costs are catered for.

The psychological impact of not paying yourself

Want to avoid burn out, stress and get enough sleep at night? Then you need to pay yourself.

Life is expensive. We all have personal expenses like rent or mortgage, food, transport and bills that we as individuals need to cover. And things can happen we didn’t budget for.

If you don’t have money coming from you business to cover these you are inviting further debt in your life, asking someone else to carry the financial load, and/or are going to face some pretty serious consequences. It’s not about only having the money to cover the essentials. It’s about having a buffer for when the problems come knocking at the door.

Money problems create extra stress on your health, relationships and sleeping patterns. It’s not worth it.

Besides, when you don’t pay yourself for your hard work, you risk sending the signal to yourself and to observers that what you do doesn’t matter, that it’s a hobby. Or that you lack the fundamental ability to run a successful business because you haven’t considered cash flow. And this could negatively impact your customer’s faith in you.

Plus, you can diminish your own faith in your abilities. The more you work without making real, tangible and measureable progress, the less petrol you can have in the old “up and at them” tank. How can you take yourself seriously alongside other women in business if you’re constantly under economic pressure?

The more you do for the least amount of return, the easier it is to let things slide.

When women avoid paying themselves, they also set up a false idea of where their business is headed. Why would you open yourself up to such dangerous self-deception?

If you value your ideas, you need remuneration.  Business is hard enough, without adding extra worries and problems through skipping rudimentary requirements.


Myths related to women in business and their success measurements

“But everyone loves the idea.”

“We’ve got a massive following on social media.”

“I was asked to speak at such and such.”

Using metrics like these to measure the success of your business are lovely, but they don’t pay the rent.

Seriously, walk into any real estate agent and ask your property manager to accept LIKES in lieu of direct deposit. Offer to speak at their next coffee break on your product. If they haven’t rung the insane asylum to get you sectioned, it should teach you a valuable lesson on why social endorsement is lovely, but it’s hardly the whole business ball game.

Including softer values as a metric is great for helping to strengthen your personal brand, but hanging your entire business on them is very dangerous.

Think about what you want more for a second – would you prefer to shout

“Hurrah, my latest 100 person targeted campaign secured me 15 new paying customers!”


“Hurrah. I spoke in front of 100 people and 15 other speakers said I did very well.”

Recognition is nice, but it becomes a little hollow after a while, right?

Having community and exposure should be viewed as an opportunity to gain paying customers, not in lieu of them.

Think about Facebook. We like photos, pages and statuses all day. It doesn’t mean it changes what we do, our plans, or will get us thinking about what we like for more than the time it takes to click.

Money is proof people have made a commitment to your business. It is proof they don’t just like the idea of your business in principle, they want it to work for them. Without the money, you don’t have very much real proof at all.


Creating a sense of urgency

Money makes us hungry. It makes us want to accrue more wealth. Once you start seeing money come into the bank account, your world view changes.

As Jane Huxley explained during the brainmates ‘making great products’ summit at Vivid Sydney, setting a revenue target without necessarily knowing where the money will come from drives you forward. As the time to hit the target approaches, you’ll start to innovate around making that financial goal.

No goal means no sense of urgency. And no sense of urgency means less pushing of the business envelope.

Plus, if you are one of the women who avoid paying themselves, you’ll never know the sweet taste of paying for something you have toiled and sweated for. Why deprive yourself of that indescribable joy?

The bottom line about women in business and that old money allergy

Measuring your business success without considering the number of paying customers and how much they pay you, and in turn the profits you make, is worse than the Emperor’s New Clothes. It’s cheering on a naked emperor and agreeing with everyone else because you are not brave enough to face the truth.

Frankly, I know which kind of woman I would rather be.

Don’t you?

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