(WOMENSENEWS)--The select club of women who own businesses with annual revenue over $1 million do things a bit differently from the majority of female entrepreneurs.

The 6 percent of female entrepreneurs who own million-dollar businesses don't max out their own personal credit cards; recourse of many cash-strapped female entrepreneurs, according to a study of the topic released today. Instead, they arrange a mix of credit sources to fund a business expansion. Not only do they line up credit in advance, they develop a mix of sources, from business credit cards and bank loans to Small Business Administration loans and vendor credit.

"Access to capital is the leading identified problem for women entrepreneurs," said Erin Fuller, executive director of McLean, Va.-based National Association of Women's Business Owners, a national organization that represents the interests of female entrepreneurs. The Center for Women's Business Research, which released the study, also produced data showing women used credit cards 36 percent of the time to finance the growth of their business. "We want to encourage women to be getting banks loans, lines of credit and creative financing deals like Small Business Administration loans," Fuller added.

"Looking at how these women have structured their business and how they are managing their business, particularly their finances, provides a key" for other female entrepreneur looking to expand their business, said Sharon Hadary, executive director of the Center for Women's Business Research.

More Certify as 'Woman-Owned'

Women at the helm of larger businesses are more financially sophisticated, according to the study, The Leading Edge: Women-Owned Million Dollar Firms. Another, perhaps less predictable finding: Women who run large businesses aren't afraid to define themselves as such. According to the study, they are nearly 2.5 times as likely as other female-owned businesses to be certified as a female-owned business. Certification as a female-owned business can be helpful in obtaining clients in some instances if companies or government agencies have a policy of doing business with female-owned companies.

Women running the bigger companies also network. The study finds that 81.3 percent of million-dollar female business owners said they belonged to formal business organizations, more than the 60.5 percent membership reported by smaller companies. The numbers are about the same for male owners of million-dollar business. As for women, mentoring and networking, be it through formal or informal channels, has been found over and over again to be critical for women to make contacts and access ideas as well as sources of funding, said Karen Kerrigan, president and chief executive of WE Inc., a nonprofit business association in Oakton, Va., that works to improve the business climate for female entrepreneurship.

Other key finding show that $1 million female-owned businesses are more likely to use formal advisors such as accountants, lawyers, boards of directors and consultants who provide what some describe as "mentoring" services.

"Clearly these women who have made it have had access to tools and knowledge and education that have brought them to where they are," Kerrigan added. "A lot of surveys have shown mentoring is key in this area. Having access to knowledge or education gives you more access to capital and access to markets."

More Negotiations and Financial Reports

According to the study, female owners of million dollar firms are also more likely than owners of smaller female-owned firms to use a variety of "bootstrapping" strategies to reduce the need for outside capital. These include negotiating better terms for their accounts payable, speeding up customer payments and leasing equipment.

They are more likely than the smaller female-owned businesses to produce financial reports such as balance sheets, income statements, cash statements, sales forecasts, and break-even analyses. They also produce many of these documents more frequently.

They also make better use of technology and are more likely to see the Internet and e-commerce as important to the growth of their business and more likely to have a Web site and use it for e-commerce.

While female-owned businesses have been growing over the past 10 to 15 years, it was the spurt of growth at the high end that really prompted the study, said Hadary. "One of the questions we had been hearing is what differentiates these larger women-owned businesses from the smaller ones."

Now armed with the answers, Hadary has set off on a nationwide tour with the study's sponsors to share the answers with female entrepreneurs. KeyBank and AT and T are hosting seminars across the country and inviting female business owners as another effort to get the word out. Hadary has already participated in seminars from Portland, Ore., to Albany, N.Y., and plans to take the message to Cleveland and Denver shortly.

Marianne Sullivan is a New York-based freelance writer who writes frequently on economics and finance.

For more information:

Center for Women's Business Research/
National Foundation for Women Business Owners:
http://www.womensbusinessresearch.org

Women Entrepreneurs Inc.:
http://www.we-inc.org

KeyBank--Women Owned Business:
http://www.keybank.com/templates/t-ps1.5.jhtml?nodeID=I-5