Businesswomen Take Control of North Dakota Oil Patch
WHY YOU SHOULD CARE
These entrepreneurial women have seized on a growing, profitable market.
By Stephen Starr
Five years ago, Williston, North Dakota, was a hedonistic mess. Busloads of oil workers who’d moved here to work on Bakken oil rigs revived by hydraulic fracturing, or fracking, would clear supermarket shelves in minutes. Strippers were flown in from Las Vegas to meet demand in the male-dominated town. In March 2013, one man was shot dead following an argument outside a club.
Today, ground zero of North Dakota’s oil patch is a very different place. In late 2014, the price of oil dropped by half, prompting most transient, single male workers to pack up and leave. Families of professionals on long-term contracts in the local energy sector moved to Williston, creating a demand for services female entrepreneurs have since successfully filled.
Melissa Krause, who moved to Williston from Milwaukee in 2012, started off with Walmart and as a journalist. Two years ago, she opened QuickDraw Art Studio on Williston’s Main Street. Her ceramist and studio associate are women from Louisiana and Montana, respectively. “I knew if even a quarter of the children born here would stay in the region, then we were going to have a lot of young families who would need child-friendly outlets for entertainment,” says Krause. Business is already up 28 percent from last year, she says, and she’s looking at expanding the studio.
I know I made a good decision.
Krause isn’t the only woman to spot a business opportunity in Williston. In 2014, the city supported three women-owned businesses through its Star Fund with an estimated $41,436; that number has rocketed to 58 since the start of 2017, with an average annual payout of $323,892. Those figures are indicative of what’s happening statewide. North Dakota ranked first for “employment vitality” — the highest job growth rate and average number of employees — over the past two decades across all states, according to American Express’ 2017 State of Women-Owned Businesses report. North Dakota ranked second — tied with Maine and behind only Minnesota — when the 2018 report looked at the past decade.
“It seems like a lot of women knew what they wanted to see in the community and seized the opportunity to carve out a place in the market,” says Krause.
Though the cost of living has risen in recent years, off-the-beaten-track locations like Williston generally have lower business startup costs. That’s important to women, since, according to research from Columbia Business School, “female-led ventures are disproportionally overlooked by venture capitalists at multiple stages of the entrepreneurship pipeline.”
To be sure, different reports — and indeed other metrics in the State of Women-Owned Businesses report — illustrate how other states are doing well too. According to the 2018 report by American Express, South Dakota is where women-owned businesses wield the highest “clout” — a measure that includes revenue earned. Fit Small Business, a resource for small-business owners, ranked Texas, Ohio and Minnesota as the three best states for female entrepreneurs in 2019. But North Dakota, which came in ninth in that report, is the rare state to place among high or top rankers across rankings.
That makes sense, since women-owned businesses in smaller areas typically earn three to four times the revenue that their peers earn nationally, according to a 2015 study by finance website NerdWallet.
In addition to Krause’s art studio, there are Cooks on Main, Little Muddy Gifts, Fresh Palate health food store, beauty and nail salons and other women-owned businesses up and down Main Street in Williston. Just off this thoroughfare, there’s Chatter Pediatric Therapy and a host of other new, women-owned businesses.
For Williston native Mechelle Mortenson, the decision to move her Grace & Glam women’s boutique from a plaza on the edge of town to Main Street in July was an easy one. “Downtown has a lot more foot traffic and has been developing really nicely in the past few years. When the space came up for sale, it was a good opportunity to get in there,” she says. Mortenson estimates there are at least nine other women-owned businesses in the immediate area. “I employ four women. Two are from out of town that came because of the economy,” she says.
Mortenson’s boutique has been helped out by two grants: one from the Star Fund, worth $33,500, which helped purchase and remodel the space, and a state-sponsored “Renaissance Zone” grant, which exempts Mortenson’s business from paying property taxes for five years. Krause also highlights the role played by local authorities. “I think they understand that the more businesses that are here [downtown], the less people are likely to go somewhere else to shop, which keeps more money local,” she says.
Life is no bed of roses. Like all local businesses, entrepreneurs are dependent on high-income customers whose earnings, for the most part, are dependent on stable global oil and natural gas markets.
The nearest town with more than 100,000 people is a five-hour drive west, in another time zone. The nearest large city is Winnipeg, in Canada. The nearest Macy’s is in Fargo, almost 400 miles east. And while rural America has clear benefits for female entrepreneurs, cutting-edge startups are still mostly found in America’s major metropolises.
Still, those who’ve come to North Dakota have not done so under any illusions. “I don’t get back to Wisconsin as much as I’d like,” says Krause, “but I know what I signed up for when I decided to open a business. I know I made a good decision.”
- Stephen Starr Contact Stephen Starr