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Everyone in tech seems to be talking loudly about the industry’s problem with women. Google and other Internet giants are self-reporting the grim gender gap in their companies, and making some laudable efforts to address it.
Tech media sites are covering the issue on a regular basis, if only because of the incessant news of sexist and otherwise bad behavior of tech executives. Women in tech, of course, are discussing the topic, and amplifying the conversation as never before (for reasons I’ll discuss more below).
However, apart from some notable exceptions, there’s one group who’s mostly staying quiet on the subject: Venture capitalists. Their silence is a mystery to me, because they have the most to lose from industry sexism — and the most to gain from demanding we improve.
Throwing good money after bad men
The thought occurred to me after reading about the latest example of juvenile offensiveness from a top executive at a hot startup: Aren’t the VCs who gave him so much money furious? Tens of millions of their dollars put in jeopardy not through a sudden shift in the market or change in business strategy, but bad personal behavior from grown men.
During the pitch session, did these VCs not do due diligence on the moral character of the founders — or at minimum, ask them if they have any skeletons in Google’s eternally searchable closet?
It’s stranger when founding executives are revealed to be sexist even though they’re leading startups utterly dependent on finding and keeping female customers. Venture capitalists pride themselves on maximizing profit, but their repeated backing of sexist founders threatens to disrupt their own investments.
How social media makes the problem better — and worse
Also notable is how many times tech exec sexism has been exposed not through Valley news sites, but through these execs’ own personal use of technology — via crude Tweets, Facebook updates, Instagram comments, e-mail, smartphone texts, etc. — revealing a profound misunderstanding of how the technology they’re supposed to be innovating on actually works. (This should be yet another red flag for their venture funders.)
On the other side of the ledger, social media also empowers women to stand up for themselves, call out bad actors, and amplify their grievances, as never before. #yesallwomen is not an anomaly, but the latest example of a trend that will only grow and expand. Thanks to tech, women have the tools they need to push back against tech’s problem with women — insuring the issue won’t be sidelined anytime soon.
Putting women in the business plan
Venture capitalist Natalia Oberti Noguera has a requirement that startups pitching her angel investing bootcamp include a female co-founder, and while it’s a great idea for her firm, which specializes in women-led startups, it’s probably not scalable into the Valley’s main line VC community, at least not for the short term.
Instead, the change that must happen first needs to be public-facing and pervasive, with VCs clearly conveying, via their websites, their social media channels, and speeches they make at incubators, hackathons, and other venues, the simple fact that adding women and attention to women to their business plan isn’t just a political nicety, but in a startups’ naked self-interest.
But it must go beyond that. To maximize their profit, VCs could even impose expectations on startups in business now, demanding that they not only make revenue and user growth targets, but hit milestones on the number of female executives they’ve at least attempted to recruit. (Companies with more female executives perform better, as do venture-backed companies with senior female executives.)
This also means creating and fostering an overall work environment that encourages both men and women to behave appropriately – not just to avoid lawsuits, but to better insure long-term profit.
Earlier this year, influential VC Hunter Walk proposed a system to track diversity in their investments, which I hope becomes an industry standard.
Another actionable step is to require that HR become a significant part of a startup very early on, to help establish a positive company culture — and, frankly, to train young founders in the basic standards of good character that many of them evidently didn’t learn from their parents.
And just imagine if, during any pitch session, a venture capitalist politely but firmly asked every budding young male entrepreneur: “Explain to me in detail how your business plan will earn revenue from women. And if you can’t, explain why I should give any money to a startup which ignores half the market.”
Alternatively, VCs could remain silent, and hope the problem goes away. Which essentially means gambling that the next PR disaster around this topic doesn’t risk their money — though the odds are, it inevitably will.
Vanessa Camones is the founder and CEO of theMix agency, a full-service marketing and communications boutique.