|
 To Atwood, who eventually won her funding from other backers, the
recommendation underscored an attitude in Silicon Valley that women
make second-class entrepreneurs. If more women held the purse
strings at venture capital firms, the attitude would change, she
said.
Despite the lip service Silicon Valley has given over the past
couple of years to the need to recruit more women venture
capitalists, at senior levels the industry’s gender balance hasn’t
budged, even as other industries with poor gender diversity show
improvements.
The issue matters because women venture capitalists have a direct
effect on the success of companies other women launch, say female
entrepreneurs, including serving as role models and being more
likely to spy potential in businesses that target other women.
About 4 percent of senior investing partners in U.S. venture capital
are women, according to data from Pitchbook, a consulting firm. That
is down slightly from 5 percent in 2010, and about even with 2008.
The numbers compare to 15 percent of executive officers at Fortune
500 companies, 24 percent of tenured faculty at U.S. business
schools, and 20 percent of the U.S. Senate - all areas that have
shown gains for gender parity in recent years while venture capital
has stagnated.
A leading ranking of venture capitalists, the Forbes Midas List,
noted just four women on its latest list of top 100 venture
investors. A few years ago, five women typically made the list each
year. And despite much discussion over the need to improve gender
balance over the past few years, many of the top firms still have no
senior women partners at all.
KEEPING QUIET
Some Silicon Valley women shy away from openly discussing the
shortage and the climate for women, believing their comments would
peg them as whiners and cut them out of deals in the case of venture
capitalists, or funding in the case of entrepreneurs.
Among firms that Forbes ranked as top because they provided multiple
partners to its Midas List, only one, Kleiner Perkins Caufield &
Byers, appears to have more senior female investing partners in the
United States compared with five years ago.
Kleiner has two women listed as lead partners in its most recent
funds. It is battling a lawsuit brought by former partner Ellen Pao,
who alleges harassment and discrimination. Kleiner denies the
accusations.
Kleiner declined to comment, but in a blog post two years ago
partner John Doerr said his firm was one of the most diverse in
terms of gender, age and ethnicity.
Another venture capital firm, DFJ, has one senior woman in the
United States, the same as five years ago. DFJ said it believed "a
diverse group of people makes better decisions, both within our
industry and the companies we fund." Accel, which declined to
comment, has no senior women investors in the United States,
although it had one previously.
Others, including Sequoia Capital, Greylock Partners, Benchmark,
Meritech Capital Partners, NEA, Andreessen Horowitz, and Bessemer
Ventures, had no senior women partners five years ago. They still
don’t today.
"No excuses," said a Sequoia spokesman. "We need to do better and
we're pursuing a number of initiatives to help." Sequoia funds
groups such as Girls Who Code, which teaches young women computer
programming. Many venture capitalists say a lack of women in
technology exacerbates the shortfall in venture.
Bessemer partner Ed Colloton said the firm believed in developing
talent internally and had "a strong pipeline of future female
partners" on the current team. A Greylock spokeswoman said the firm
has discussed how to improve the situation, including backing
startups with diverse executives in hope of cultivating a more
diverse next-generation group of venture capitalists.
A spokeswoman for NEA said it was “focused on having a strong bench
that will result in a more diverse GP (general partner) group over
time.”
Andreessen Horowitz's Peter Levine and Benchmark's Bill Gurley, both
general partners, said their firms were eager to hire a senior
female investing partner but hadn't found the right fit. Meritech
founding partner Paul Madera said he hoped to one day hire a female
partner.
BAD PRESS
The paucity of senior women VCs exists at a time when difficulties
facing women in technology have hit the headlines.
Examples include statistics showing low numbers of women at
companies such as Facebook and Google; a lawsuit by a female founder
of dating app Tinder alleging she was pushed aside; and three suits
brought by female employees at venture firms alleging harassment or
discrimination, or sometimes both.
[to top of second column] |
Despite the lawsuits, female venture capitalists say, the troubles
in venture generally lean to the subtle, such as leaving women out
of key meetings or social gatherings.
Even if they lack women in investment roles, which carry the most
prestige, many firms have senior partners in operational roles such
as marketing and finance, and many back female-founded companies.
“I am quite optimistic about women in venture,” said Benchmark’s
Gurley, who while he has no female investing colleagues himself
named Ruby Lu at DCM, Jenny Lee at GGV, and Rebecca Lynn at Canvas
as “fantastic” investors.
Other accomplished female investors include Mary Meeker and Beth
Seidenberg of Kleiner Perkins; and Theresia Gouw, formerly of Accel
Partners and now head of her own firm, Aspect Ventures.
FITTING IN
Many venture capitalists, both women and men, say that a big part of
the problem lies in the educational and career paths many women have
opted to pursue at a time when many firms seek VCs with technical
backgrounds.
The percentages of women majoring in engineering, computer science
and math have declined over the last decade, to 19 percent, 18
percent, and 43 percent of all students majoring in each of those
fields respectively, according to the National Science Foundation.
The percentage of female entrepreneurs has stagnated since the early
1980s at around 27 percent, says Ross Levine, a professor at the
Haas School of Business at the University of California, Berkeley.
“You have to say, ‘Where are the women in computer science?’” said
Ann Winblad, a founding partner at Hummer Winblad, who added that
her firm hires partners largely from the group of company founders
it has backed.
Top firms especially tend to lack senior women, leading to
comparisons with “Mad Men,” the TV show about 1960s-era advertising
where men dominate. Benchmark and Sequoia, for example, employ no
women in any investing capacity in the United States.
Most firms do the bulk of their investing in the United States, but
some of them say their numbers would be better if overseas offices
were included. Sequoia employs female managing directors in China,
for example.
Another issue is that top firms enjoy spectacular investing results,
leading to little pressure from their own investors -known as
limited partners - to change things, the LPs say.
“At the end of the day, it does come down to returns, and their
network,” said Atul Rustgi, a principal at Accolade Partners, a
limited partner whose portfolio includes leading venture firms such
as Accel and Andreessen Horowitz. Accolade raises the gender issue
with its portfolio firms, but “how much pressure you can exert is a
whole different matter,” he said.
Judy O’Brien, a five-time Midas List venture capitalist who is now a
partner at law firm King & Spalding, says, learning the ropes
without a female mentor can be tough. “You don’t quite know how to
conduct yourself in a senior position,” for example, establishing
stature in a meeting.
Many women say they did not initially aspire to become a venture
capitalist and needed someone to nudge them into the business.
Aileen Lee, a onetime engineering major who stepped back from
Kleiner Perkins two years ago to start her own firm, Cowboy
Ventures, spoke in April about her career in a speech at Upward, a
women’s organization founded by Lisa Lambert of Intel Capital.
It took Kleiner Perkins reaching out to her while she was an
executive at Gap, the retailer, before she even considered the
industry. The men she had known at Harvard Business School who
aspired to venture capital seemed worlds away. Drawing laughs, she
pegged them as preppie squash players and overly ambitious briefcase
toters.
"I just figured I’d never fit in," she said at Upward. "I don’t
still."
(Editing by Edwin Chan and Ross Colvin)
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