The plain numbers about women in tech – The VCs

Comments

1. Sheryl Schultz says

   January 31, 2012 at 10:54 am

   Thanks for this post. You absolutely got it right. Re: Golden Seeds. In addition to their $26.5MM fund, they have a network of 235 individual investors that are funding high growth women owned businesses across the country. Since 2005, they have invested $29MM in 42 companies.

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2. Gabby Hon says

   January 31, 2012 at 1:03 pm

   Whitney, would it be a terrible imposition to inquire as to the founding dates of all the firms? Primarily the first batch. My thought process is this: because women have only, really, been actively in the wider workforce for ~40 years (And I think it can be fairly said that no real strides into management and the C-suite were made until the 80s), there does not exist the same level of personal wealth that would enable women to become investors, particularly in the very large, well-known firms.

   We’re also talking about a generational difference: women who are old enough to have amassed significant wealth and influence are from a generation in which having children and staying home to raise them was of high importance than career and wealth development.

   Once again, we have the Baby Gap as well as the Women Haven’t Been Working In the Professional World As Long As Men Gap. So, that women lag men in significant percentages across many areas really isn’t surprising.

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   • whitney says

     January 31, 2012 at 1:45 pm

     Gabby, I had intended to include the founding years, but then left them out at the last minute. The post is now updated. Turns out there’s no correlation at all between age of fund and gender ratio. In fact two of the oldest funds, Sequoia Capital and Kleiner Perkins, both founded in 1972, have the most female investors.

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   • Marcos Polanco says

     January 31, 2012 at 8:34 pm

     Gabby,

     Take a look at the supply chain for HOW these individuals made it to their investment post. The pathway includes, typically, hitting it out of the park as a tech CEO. Now, where do these CEOs come from? Typically, they are software geeks. So, without conducting a scientific study, the root cause of the lack of female VCs is the lack of female software geeks. Though Silicon Valley in particular is far from a meritocracy, as Vivek Wadhwa has so amply documented, the pathway does not include wealth as VCs manage funds on behalf of third parties. Notice that the leading VC in Silicon Valley today is Marc Andreessen, and he’s just 40.

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     • Gabby Hon says

       January 31, 2012 at 10:16 pm

       The singular of ‘data’ is not ‘anecdote’. Without a great deal more information about these investment firms, their investors and the backgrounds of those investors, we don’t know anything. Nada. Zippo. Zilch.

       To be honest, this is something worthy of considerable research. I mean, it’s interesting that women aren’t represented in higher numbers in the tech industry — but I’m more intrigued by *why* it’s interesting. I mean, where do we get the notion that a) more women should be in tech and b) what the hell would it mean if there were more women in tech?

       And, of course: slippery slope! Because if you’re going to start counting according to external differentiators such as sex/gender, then well, race is next. And then sexual orientation. And then disability. And then. . . And then . . . And then. It honestly never stops.

       The important question — the only question that matters — is whether these investors are bringing experiences and points of view that are helping their firms earn a bunch of money. And if not, then that’s no one’s problem but the firm’s.

       The only diversity that counts — the only kind that will deliver any kind of long-term benefit — is diversity of the mind.

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3. Steven A. Lowe says

   January 31, 2012 at 1:22 pm

   Very interesting research Whitney, thank you.

   The question that leaps to mind: is there actually a large enough pool of qualified women to balance things out?

   For example, if there are 5M programmers in the USA and only 500K are women, having an idealized workplace gender balance of 51%-49% (to reflect the general population) in all IT companies is simply going to be impossible.

   What does your research say? Are there enough qualified women to go ’round?

   Keep up the great work!

   –S

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4. Pamela Castillo says

   January 31, 2012 at 6:24 pm

   This is a great and eye-opening article, thanks for doing the research!

   Good news: DFJ Gotham has added a women venture partner – Joy Marcus! http://www.dfjgotham.com/bio_marcus.html

   Heard her speak at the Women’s Entrepreneurship Festival and at a breakfast put together by DailyWorth and she’s fabulous and super smart.

   +1 woman #ctr!

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5. Marcos Polanco says

   January 31, 2012 at 8:38 pm

   Whitney, you indicate that female internet usage should be an indicator, or that there should be some correlation with the presence of female venture capitalists. Note that that massification of the internet is a very recent event…it is only quite recently that design and marketing skills, not raw techie geekiness, became an important differentiator in the tech industry. Thus, the females that will become the relevant VCs given the trends you correctly indicate are probably, and quite hopefully, hard at work creating the companies that are riding the current trends. VCs today come from another generation when none of the trends that you point to were yet in place.

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6. Sarah says

   January 31, 2012 at 9:16 pm

   Wow – Whitney. This must have taken an incredible amount of work to put together. Thank you so much for doing it… really good for people to see!

   Sarah

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7. Carissa Ganelli says

   January 31, 2012 at 9:31 pm

   Hi Whitney,

   Thanks for putting the spotlight on the paucity of female representation. I have to say that in my 20-year career, I have NEVER experienced as much sexism as I have in the past few months trying to raise money for my startup. Here’s a sample of actual comments that were made to my face by VCs (not angels):

   “Do you have kids?”
   “Who’s watching them?”
   “I can’t believe your husband married you.”
   “Have you heard of Golden Seeds?”
   “Do what you know like something related to babies or fashion”
   “You’ll probably need help with the financials”
   (even though I have an MBA in finance from Kellogg).

   I can’t make this offensive cr*p up.

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   • Cori Johnson says

     February 3, 2012 at 2:22 pm

     Wow. That’s disgusting. I hope there someday is a way to name names to call these assholes out for their unacceptable behavior.

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8. erin newkirk says

   January 31, 2012 at 10:10 pm

   This is the crux of the argument for me. I am baffled by it.

   “With women making 85% of purchasing decisions and far surpassing men in their Internet usage, doesn’t it seem wrong that hardly any women are involved in controlling which companies create our future?”

   That being said, it’s exciting to think about how much opportunity there is out there for Internet start-ups and investors that really “get” women.

   #ctr

   Reply

9. Natalia Oberti Noguera (@nakisnakis on Twitter) says

   January 31, 2012 at 10:57 pm

   Whitney,

   Thanks for highlighting the lack of diversity in the VC ecosystem.

   Your post particularly resonated with me as I’m working to increase diversity in the angel investing community.

   According to a report by the Center for Venture Research at the University of New Hampshire, only 12% of U.S. angel investors were women, and only 5% were minorities in 2011.

   The Pipeline Fellowship trains women philanthropists to become angel investors through education, mentoring, and practice. Fellows commit to invest in a woman-led for-profit social venture in exchange for equity and a board seat.

   Here’s to your upcoming progress report indeed being a _progress_ report!

   Reply

10. Joan Pepin says

    February 1, 2012 at 1:41 am

    Excellent research! And some good points about the baby gap, etc. There are some explanations, but at the end of the day, a phenomena I see at work all throughout Silicon Valley is that these VCs apply their “pattern matching” thinking when they decide which founders to fund, and they then encourage or force those founders to follow the same “pattern matching” when they hire their senior management teams. Those senior managers then roll this downhill and since the original “pattern” the VCs try to match is their own reflections, you wind up with a bunch of men who all went to to the same five schools running everything. This then causes a whole lot of groupthink and negates all of the advantages of having a diverse and creative workforce.

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    • Rohan Jayasekera says

      February 1, 2012 at 11:12 pm

      I’m glad that Joan Pepin brought up the “pattern matching” method of deciding where to invest, which to me seems like the strongest force in perpetuating the status quo. It may not matter as much who pattern-matches (men vs. women investors) as who dominates the pattern being matched (founders who are almost all men) — though I would still hope that women investors, as the “newcomers”, would pattern-match less slavishly and then, as Joan points out, would be less likely to impose past patterns on those they fund.

      Reply

11. Christine Tsai says

    February 1, 2012 at 2:25 am

    Hi Whitney – 500 Startups didn’t make the list (our fund size is much smaller than all these firms), but our investment team is 50% women. (2 out of 4), and we also have 1 non-investment woman partner (Christen O’Brien).

    Reply

12. Hamutal Meridor says

    February 1, 2012 at 2:56 am

    Thanks for this important post Whitney!

    I believe the problem grows even deeper. The predominantly male funding scene sets an inherent male preference in the whole fund raising process, as this VentureBeat post suggests:
    “Women aren’t as good and don’t like fundraising because the current mode of fundraising is built by men and for men. Most of the characteristics that are best for fundraising are especially aligned with typically male characteristics — characteristics like asking for what we want without apology or projecting confidence bordering on arrogance.”
    http://venturebeat.com/2011/12/06/women-founded-funded-startups/

    Reply

13. Joy Marcus says

    February 1, 2012 at 10:10 am

    Id like to give DFJ Gotham credit for one (me). You will see me on the website.
    However, we have a long way to go all of us.

    Reply

    • whitney says

      February 1, 2012 at 10:15 am

      My mistake! That’s now fixed. Sincere apologies and thank you for bringing it to my attention.

      Reply

14. Mark Chou says

    February 1, 2012 at 10:18 am

    For what it’s worth, the New York City Investment Fund (where I work) currently has a team of 5 investment professionals, with 2 associates supporting three female partners investing primarily in enterprise IT, cleantech, biotech, and consumer/retail companies in the 5 boroughs. Definitely not the norm, but perhaps an encouraging data point for you.

    As a side point, I think it’s the DFJ network with ~$6bn AUM; I’d venture to say that DFJ Gotham is significantly smaller than that.

    Reply

15. Alex C. says

    February 1, 2012 at 2:08 pm

    Thank you so much for sharing this research with us, Whitney – it’s such an important topic!

    Reply

16. Kat Gordon says

    February 1, 2012 at 6:56 pm

    I live in Silicon Valley yet work in another field where women are grossly under-represented: advertising. Only 3% of creative directors are women, despite the fact that women control 85% of consumer spending. My favorite comment from above is Erin’s: “That being said, it’s exciting to think about how much opportunity there is out there for Internet start-ups and investors that really “get” women.”

    There are riches beyond compare available to “Guys Who Get It” — that is men who understand that involving women + investing in their ideas goes far beyond gender-equity — it’s very, very smart business.

    Reply

    • erin newkirk says

      February 1, 2012 at 7:16 pm

      Kat,

      It’s no surprise you are in advertising with the ability to spot market opportunity a mile away. :)

      As I wrote my comment last night, I mused over how we have to continue to relive the same struggle over + over that has played out in consumer packaged goods and auto and many other industries. This “crazy” notion that women represent a lot of untapped buying power.

      Feels only right that someone in advertising will come up with today’s “soap opera a-ha” for VCs. I’m betting it’s a woman.

      Reply

17. Jess says

    February 2, 2012 at 7:19 am

    Is it really necessary to BE part of the target audience in order to understand it? I would have thought that UX design answer would be ‘no’.

    And maybe it perpetuates the idea of the great gender divide to say that men could never understand what women want?

    I, too, am interested in WHY it would be this way – but I don’t think it makes logical sense to demand change without good reason. I’m not sure that better serving the needs of a female market is a good enough reason.

    Reply

18. Patricia Marchetti says

    February 2, 2012 at 1:13 pm

    This is illuminating, but not surprising. It’s one reason why I’ve seen more events and organizations spring up for women entrepreneurs like me.

    I can’t speak for all of the VCs. But I recently met Brad Feld at Foundry Group and despite the fact that they don’t have female investors there, Brad seems to be working hard with the National Center for Women in IT on changing the equation. More female tech geniuses will someday equate to more entrepreneurs that eventually become VCs.

    Reply

19. kylie sachs says

    February 3, 2012 at 10:40 am

    Whitney – it’s interesting what you learn when you let the facts speak for themselves. We hear a lot about how more women should be engineers and that will address the issue but I am not sure that is right…how many of the current VCs are engineers? Many certainly but I asked that question on a panel once and the response was less than 30% of VCs at the firms we were discussing. So what to do? I think keep executing like you do and making your work speak for itself. I have my own thoughts on this here: http://realtismoi.wordpress.com/2011/11/15/stranger-in-a-strange-land-or-being-a-woman-in-tech/ from back in November. KS

    Reply

20. Lon Hetrick says

    February 3, 2012 at 10:44 am

    Whitney, I think that people in a free society will naturally gravitate to what interests them and what they are qualified for. I don’t think there’s a need to see a societal inequity behind the phenomenon you document here, anymore than there would be that there are very few female construction workers and mechanics. People are driven by interests; they don’t mindlessly self-distribute evenly into career paths that reflect the general demographics of the population.

    If your research included interviews with male dominated VC firms and you uncovered a bias against women, yes, that would indicate an ethical problem. But as it is, I must agree with Gabby above and say I can’t see any ethical issue here at all.

    Of course, full disclosure, I’m a man.

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    • Cori Johnson says

      February 3, 2012 at 2:38 pm

      “People are driven by interests; they don’t mindlessly self-distribute evenly into career paths that reflect the general demographics of the population.”

      I disagree, Lon. Children do grow up with some inherent understanding of gender identity, but interests are encouraged or discouraged by the socialization we receive from birth. It’s not “mindless” to be influenced by the implicit expectations of our culture. To say that there are not a lot of women in tech (and, by extension, VC firms) because women aren’t generally interested in tech is to discount the staggering efforts women are making to be seen and succeed in our field. At every turn there are problematic symptoms of inequity: hiring bias in startups; “booth babes” at trade shows; sexist jokes, comments and advances at tech conferences; women being ignored or harassed online or criticized for “attention whoring” for wearing a cardigan in a company photo; and here, male-dominated command of investments. This is not anomalous. This is a trend.

      If you still cannot see the ethical issues, I recommend you look closer before dismissing the concerns as moot.

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      • Lon Hetrick says

        February 3, 2012 at 2:53 pm

        I appreciate your perspective. But I confess that I choose (naively, perhaps) to optimistically believe that women in tech or finance or whatever are more self-empowered, and self-determined than you seem to give them credit for. Cultural influences are only that: influences. They can be resisted. If I am naive on this and there is a real problem, then women of America can count on men like me to be part of the solution, not the problem.

        Reply

21. Naomi Niles says

    February 6, 2012 at 2:32 pm

    Thank you for addressing this, Whitney! It’s super important to talk about.

    You know, I just believe that many women play a different game. Yes, there is some oppression. Being a self-employed young woman, I’ve gotten my fair share directly and indirectly from both men and other women.

    I feel like it’s been worse from other women, ironically (please don’t shoot me for saying so).

    On the other hand, the last few years have taught me a big lesson: If you don’t like the game being played, make your own.

    I don’t think this needs to be about one gender or another either. Just that some of us would rather do things differently. If you have a business that you feel can be profitable and scalable AND you put your passion into it, I really don’t see anything wrong with that.

    In fact, I think the world seriously needs more businesses like this.

    Reply

22. Emma says

    September 20, 2012 at 11:56 am

    I just tweeted at you, but I’ll post here too. I’ve noticed this trend in tech and VCs for the last couple of years and appreciate you shedding some light on this topic. I come from a design background and have been working heavily in UI now for the last few years and am getting into more UX (my minor in psychology is finally coming in handy). I’ve noticed that in the visual design and UI world, there are very few women. I’m an active Dribbbler and I can tell you it’s overwhelmingly male. I did a quick search, as I have no access to hard stats to help determine a ratio, on designers with a primary skill set in UI. Out of the top 75 UI designers, only 5 of them are women. At my company alone, there are 4 women in a team of 15. Aside from myself, the other women’s jobs are as follows: database specialist, project manager, and office/accounting manager. I also noticed, as I was registering for our local Startup Weekend event, that the judges and coaches were also primarily male. 1/ 5 judges, 1/10 coaches. I’ll be interested to see what the ratio is for participants.

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23. Jacqui Emerson says

    August 7, 2014 at 11:17 am

    Is there any update on this, or are we still in the same place as we were three years ago?

    Reply

    • Whitney Hess says

      December 22, 2014 at 2:44 am

      I haven’t done a recount recently, but maybe I should…

      Reply