#301
The SHEconomy

Published:

Aug 24, 2019


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Published:

Aug 24, 2019


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The SHEconomy is the growing portion of the American economy driven by women. In its latest research report, Morgan Stanley reports that this part of the US economy is booming – contributing to an outsized share our current economic growth.

So what are the SHEconomy tailwinds, and what does it mean for investment opportunities and financial services?

The growth in the SHEconomy has three important tailwinds – single woman are growing as a demographic (25% of the US population), the female workforce is growing (44.5% of the US workforce), and women’s purchasing power is expanding (3% CAGR versus 2.5% for men). Still, there are many obstacles to overcome - chief among them the 22.5% wage gap between men and women.

To increase exposure to the SHEconomy, Morgan Stanley recommends buying stocks such as LuluLemon, Nike, TJ Maxx, Starbucks, and Tesla. In the private sphere, fintech startups such as Miss Kaya, FinMarie, and Ellevest are providing digital wealth management tailored to the evolving needs and values of women.

VCs should also pay attention – KPMG has found that fintech startups with at least one female founder have more than double the internal rate of return (IRR) than all-male founding teams.

As secular trends push us towards improved gender equality and female empowerment, we are happy to recognize the outsized role women will play in the economy for the coming decades.

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