Is U.S. Economic Growth in the Hands of Women? The Kauffman Foundation Thinks So

The Kauffman Foundation, which specializes in supporting entrepreneurs, has taken a keen interest in women in its latest research. Its recently published study, "Sources of Economic Hope: Women's Entrepreneurship," asserts that "American entrepreneurship and growth is in the hands of women. We need to figure out what will help the country take advantage of this opportunity."

That's a striking proposition, albeit an increasingly familiar point coming from funders. Before drilling deeper, though, let's talk a little about what the Kauffman Foundation is funding these days, and how its research on women fits into its broader strategy.

Lots of funders talk about jobs and opportunity. What makes Kauffmann special is that it fosters entrepreneurship and the creation of new businesses—which, of course, is how many new jobs get created in this country. You don't need to buy into the glorification of "job creators" to see how important Kauffmann's approach is, or how different from the more typical funding strategy of boosting education and skills on the dubious assumption that enough jobs will exist for all these people or that better human capital itself can drive growth.

Kauffman's grants over the last six months have mostly ranged from $5,000 to $200,000, with two big exceptions: $3.2 million for the National Bureau of Economic Research in Cambridge, for multiple projects including conferences and a Boot Camp for entrepreneurs; and $3.5 million for the Greater Kansas City Community Foundation & Affiliated Trusts to provide scholarships. You can see the full list here.

Its myriad smaller grants support entrepreneurship in higher education, general operating support for arts organizations, as well as research on economic issues and entrepreneurship. It seems to favor community colleges in its higher ed giving, which makes sense given the crucial role these schools play in ensuring that growing local businesses can find the skilled workers they need.

Kauffman is also funding a lot of research into "high-growth firms" in the U.S., trying to learn what kinds of businesses that do well in today's economy and why. While a higher proportion of its giving appears to go to Kansas and other mid-western states, it's also recently given to programs in Texas, Virginia, and Massachusetts.

Kauffman, like many foundations of the mid-20th century, was founded by a ROWG (in texting slang, that's Rich Old White Guy). Ewing Marion Kauffman was a small pharmaceuticals manufacturer who hit the big time. He started developing his Marion Laboratories in his basement, and went on to grow his initial $5,000 investment into a merger with Merrell Dow Pharmaceuticals in 1989, with estimated revenues of $930 million.

No wonder the guy became such a big booster of the American dream.  

Kauffman is perhaps most famously known for establishing the Kansas City Royals and bringing baseball back to the Midwest. Kauffman Stadium, the only American League baseball stadium named in honor of a person, was regarded as well ahead of its time when it opened in 1973. One other compelling factoid on Kauffman: He is a case study for early reading portending well for later success, since at age 11 he was bedridden with a heart condition and read 40 books a month for a year.

He established the Kauffman Foundation in the mid-1960s, out of a strong desire to help young, disadvantaged kids. Kauffman loved innovation, and he wanted his foundation to foster that love in others, and to spread their good ideas to other communities. He was an early dealmaker with high school students when, in 1988, he told some Kansas students that if they would stay in school, stay off drugs, and avoid teenage parenthood, he would pay for them to go to college. While similar programs rose up around the same time in different parts of the country, Kauffman wanted his program to be a philanthropic model of risk taking and community engagement to foster change.

And grants specifically supporting women in entrepreneurship? The Kauffman Foundation has been supporting women in business for at least a decade, with larger grants for women and entrepreneurship since 2010, when it began supporting Astia, a global nonprofit that advances women's entrepreneurship.

Astia is right on target with Kauffman's mission to support women entrepreneurs. Astia's goal is to "propel women's full participation as entrepreneurs and leaders in high-growth business, fueling innovation and driving economic growth." Along with providing early professional development for women's businesses, Astia helps women access capital so they can grow their businesses, since research like Kauffman's recent study shows that many women lack access to the dough that men have.

The larger context of Kauffman's recent work, obviously, is that the past decade has seen a stampede of funders zeroing in on women's empowerment as a key to economic development, especially in poor countries. Most notably, the microfinance movement has had a strong gender lens. 

Curiously, a search of recent grants by Kauffman does not turn up any grants in 2014 specifically for women. So perhaps with its most recent study, it's trying to figure out its next move.