The figurative post-Women’s-History-Month
hangover is my favorite time to reflect on my place in creating gender-equity
in my communities. I spend the month of March uplifted and energized by
celebrating groundbreaking women, past and present. Like many, I have the best
intentions to take my learnings and apply them in my personal and professional
life. It’s easy for me to say I will do more to actively support my fellow
women in the workplace. It’s even easier to roll into April and get wrapped up
in “the way things are” and do nothing.
As a former executive recruiter, I had the pleasure of
partnering with F500 C-suite executives, board members, PE and VC investors,
and founders to advise them on their most valuable resource — talent. The one
topic that came up in almost every conversation? Diversifying management teams.
I remember having similar conversations with executives that want to
create a more equitable workplace and want to hire more women
or people in underrepresented communities, but struggled to act on those
intentions.
So, join me in this post-Women’s-History-Month
reflection period to set our intentions, arm ourselves with the right
resources, and take action.
Women in VC
One of the sectors with the lowest percentage of women
in decision making roles is Venture Capital — which in my opinion is the sector
that has the most to gain by dismantling homophily. Venture Capital (comprised
of <12% female investing partners) can be the gatekeeper for the next ideas
and innovations that will shape the quality of our lives. Reaching gender
equity, at its minimum, is the smart business decision. At its best, data shows
that more women with investing power leads to better fund returns, diversified
investment decisions, lower risk, more innovation, inclusive cultures,
psychological safety in the workplace, and more profitable exits.
The Women in VC Equation
The other side of this “Women in VC” equation? Women
entrepreneurs in need of VC funding.
We have all seen the undeniable evidence of the
above-average performance of women-founded startups. When thinking about
revenue, profits, and exits, women-owned startups on average are simply better
investments, and yet see just 2% of investing dollars from VC. Worse, this
percentage has not changed significantly in the past few years.
The little I know about balancing equations leads me to one solution — if we want more women on the receiving side of investor dollars, then add more women to the check-writing side [increase in women check-writers = increase in funding in women]. Having more women investors roots out these gender biases that hinder ventures at the earliest stages.
The Gender Myth
I know I’m not sharing anything new so far but I think
it’s worth reiterating, especially since I still get “I just don’t understand
why more women aren’t interested in VC” comments when broaching this subject.
Or as a recent partner interviewing me said, “It just doesn’t seem like women
want this enough.”
So why does this myth still exist that women don’t want
to be in VC? In my casual investigations about this worn out trope, I can point
to the following phenomena:
1. The Gatekeeper Bias — some boys clubs want to stay boys clubs. It’s
the same cultural effect we’ve seen in other high-pressure/high-reward
male-dominated industries. Qualified women successfully enter the industry,
climb the corporate ladder (all while facing unique workplace pressures that
their male counterparts do not) but then eventually exit early. Retention is as
important as recruiting.
2. The Resume Snobs — as an MBA candidate in a top US program, I don’t
say this lightly: stop screening out candidates based on pedigree. An Ivy
League resume is incredibly impressive and a good indication of smarts,
leadership, and drive, but it’s only just that — an indication.
3. The False Narrative — this one is for my fellow women who are
interested in VC (and there are many). We’ve been told many
times that this industry is for risk takers, for former bankers, for those in
STEM, for those with large networks, for those with years of experience, for
those who meet every job description requirement. It’s easy to hear that and be
dissuaded (I’m guilty of this). I urge anyone with an interest in the VC world
to tune out the noise and move forward with your pursuit. The VC industry will
catch up to you.
A New Approach
Useful and diverse skills can be found in surprising
backgrounds — and often not in backgrounds that look like yours. But, creating
the diverse teams you seek takes work, and not just the “changing hearts and
minds” kind of work. Real change requires structural and organizational change.
So, if you (the VC) are having discussions about
diversifying your talent, and in particular hiring more women, then here are
some simple checks to ensure you are on the right track:
1. Uniformity is the death of new ideas. Be comfortable
with the different, the unique, and the new in other people. That short term
uncomfortable feeling you have is surmountable, and in return you will
dismantle the existing male-dominated networking effect.
2. Invest in a structured hiring process that cuts out
those sneaky opportunities for unconscious biases like pattern matching, and
conflating “liking someone” with liking the qualities in someone that remind
you of yourself (trust me, I do this too).
3. Start measuring your DE&I hiring, developing, and
promoting — and then share that data with the community. Transparency,
transparency, transparency!
Leading the Pack
The good news is, incredible leaders and innovators in
the VC industry are already doing the work successfully. Here are just a few
notable VCs, angel firms, consortiums, incubators, and funds doing it right.
·
BLCK
VC
So if you haven’t joined already, hop onboard! Take the
next 11 months to implement the changes you want to see in the workplace, and
we’ll join in celebrating your successes during Women’s History Month next
year.
Sources:
https://wappp.hks.harvard.edu/venture-capital-and-entrepreneurship
https://www.crunchbase.com
https://hbr.org/2020/01/how-the-vc-pitch-process-is-failing-female-entrepreneurs
https://blogs.cfainstitute.org/investor/2019/07/01/the-venture-capital-gender-gap-what-qualifies-as-female-content/
