People are up in arms after the recent reporting by The Information that six women entrepreneurs were sexually harassed by the managing partner of a VC firm, and rightly so.
While the news is making headlines globally, the more substantive questions remain — what will happen when the buzz fizzles out? Do we go back to business as usual? Maybe we try and be a little more aware, or just a little less sexist? It’s time to take a hard look at how we are conducting business in venture and address the role of women in our industry.
VCs are agents of change and innovation, investing in the future. For an industry that drives innovation — from the Internet and the mobile revolution, to self-driving cars and artificial intelligence — we have a difficult time changing ourselves.
Always looking ahead, we need to look at the present, at ourselves, today. Only 17 percent of startups have female founders, a number that has remained flat for the past five years, and only 7 percent of general partners in VC firms are women. These statistics are dismal and underscore four persistent problems in our industry:
- We aren’t funding enough women entrepreneurs
- We don’t have enough diversity in the senior ranks of the management teams in our portfolio companies
- We don’t have enough independent directors that are women on our boards, and
- We don’t have enough women who are general partners in venture firms.
What will it take to move the needle so that women are respected and integrated as equals across all aspects of our industry?
Let’s start by looking around the table in our Monday partner meetings to see how many women, and for that matter, how many minorities, are true members of our general partnerships. And by true, I’m not referring to recent MBAs who are handed partner titles, but have no investment authority or sufficient economics in the general partnership.
The same kind of accountability goes for looking at the number of women entrepreneurs we are funding. In this digital age where we have seen a dramatic rise in tech-enabled businesses, not just traditional tech businesses that require computer science and engineering degrees, by now we should have funded many more women entrepreneurs. Yet, that’s not the case.
By not funding women entrepreneurs and not having women’s voices as directors on our boards, we are listening to half of our audience. This miss is even more accentuated when considering that in 80 percent of households, women are the financial decision-makers.
As VCs, we work so hard to identify and collaborate with outstanding founders who have the vision and execution strength to disrupt the present and reimagine the future, yet we willingly choose to ignore half the talent pool. Funding exceptional women entrepreneurs means good business, and a higher potential for returns, just as it does for their male counterparts.
And, for those of us women who are already sitting at the board table, who are members of GPs or hold C level executive roles, let’s not get comfortable in monopolistic roles – we need to take an active role in pulling up other women alongside ourselves.
Agents of Change
While the past is not always an indication of the future, we have all seen the challenges that the VC community is dealing with today in other industries. Fields like medicine and academia have made progressive strides — we should too.
It starts with people speaking out – like the brave women who have just come forward – and each one of us being accountable for how we conduct business and doing our part to create diversity in our firms and portfolio companies.
Our partnership at Glasswing Ventures stands behind the #DecencyPledge, and fully supports the NEVCA, in taking taken a stand for change. In a business that is all about change, venture has waited far too long and the moment for change is now.