Fortune Magazine is in its second year of taking an in-depth look at the number of female’s who hold positions of leadership in venture capital firms. It breaks the research into two categories – those firms that have raised over $200 million, and those who have raised over $100 million.
Last year the dismal picture portrayed only 4.2% of the firms had women in leadership in VC funds over $200M. This year the figure was only slightly better at 5.6% but that also included the smaller cohort of firms with $100M. Complete story here.
Two nights ago in Buffalo, NY the Start Up Grind presentation was by Rohini Srihari of Content Savvy who just completed a very successful round of capital. An impressive feat by any company, made more significant that it is a women in tech.
So while we applaud her efforts and accomplishments – we need to also acknowledge how very rare this is in both the tech and VC worlds.
I have attended a number of Start Up Grind events, as well as another gathering in Buffalo – FIKA – that aims to create a culture of entrepreneurship in our Rust Belt City. And despite the fact that I have many friends in the room at each event, I never feel like I fit in. I am a woman. And I am not in tech or VC.
It occurred to me a couple of months ago that the room is dominated by young white men because the people holding the purse strings in VC are most often older white men. And they look at these young guys with their gadgets and the promise of being the next big thing they see themselves as they were when they were young. They can relate to them. They understand the way they think, what drives them, what will make them successful.
So how can these older white men watch a presentation by a woman and see themselves in her? It’s more difficult, even for those who are avowed feminists or believe in the economic power of diversity. Human beings are hardwired with a prejudice, however slight, to relate to those that look like them (or like they did 20 or 30 years ago).
And that is why the issue of ensuring that women are holding positions of leadership when it comes to anointing a start up with capital is critical to female entrepreneurs. But it goes beyond that. Time and again research has proven that a gender balance of 30% or more on a corporate board leads to higher sustained profitability by the company. And that women in management and executive roles ensure that corporations succeed.
So it is not much of a leap to say that more women starting companies and completing successful rounds of funding will lead to sustained economic gains in their communities and throughout the Country.
This is not a women’s issue – this is an issue of basic economics. Let’s hope the VC funds catch on soon.