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Silicon Valley VCs and the Gender Gap 375

Posted by Soulskill
from the bake-me-a-pie dept.
fysdt writes with this excerpt from TechCrunch: "An analysis of Dunn and Bradstreet data shows that of the 237,843 firms founded in 2004, only 19% had women as primary owners. And only 3% of tech firms and 1% of high-tech firms (as in Silicon Valley) were founded by women. Look at the executive teams of any of the Valley's tech firms — minus a couple of exceptions like Padmasree Warrior of Cisco — you won't find any women CTOs. Look at the management teams of companies like Apple — not even one woman. It's the same with the VC firms — male dominated. You'll find some CFOs and HR heads, but women VCs are a rare commodity in venture capital. And with the recent venture bloodbath, the proportion of women in the VC numbers is declining further. It's no coincidence that only one of the 84 VCs on the 2009 TheFunded list of top VCs was a woman. ... Additionally, it is harder for women to obtain funding than for men. ... historically, women-led companies have received less than 9% of venture capital investments; in 2007, the proportion of funded female CEOs dropped to 3%."
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Silicon Valley VCs and the Gender Gap

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  • by zach_the_lizard (1317619) on Sunday February 07, 2010 @01:00PM (#31053012)
    Time for another insightful discussion on the gender gap in tech. There will be no flames, no attacks, and no blaming. Just quiet, reflective discussion.
    • Re: (Score:3, Interesting)

      I'm continually surprised whenever a gender related topic comes up for discussion on Slashdot. There is an awful lot of bitterness towards women on this site. Where it comes from, I don't know; but it is present across the tech sector. Considering how liberal slashdotters tend to be on most issues, this one really stands out like a sore thumb.

      • Re:Time for.... (Score:5, Informative)

        by russotto (537200) on Sunday February 07, 2010 @04:05PM (#31054284) Journal

        There is an awful lot of bitterness towards women on this site. Where it comes from, I don't know; but it is present across the tech sector.

        Stereotypical interaction between proto-slashdotter and female of similar age in junior high and/or high school

        PS: "Hi."
        FSA: "Eww, get away from me, you little creep."

        Understand now?

      • Re: (Score:3, Insightful)

        by timmarhy (659436)
        what, where do you get this idea we aren't liberal on women in the work place? the vast majority if post in this topic are to the tune of "whatever it's up to women to take the initative, we don't see what's holding them back".

        the fact that this topic keeps comming up indicates to me that the femminist movement is desperate to stay relivant. they won they equal rights years ago, now in the western world atleast women have the same if not MORE rights in the legal system then men. ever tried to win custody o

  • by Third Position (1725934) on Sunday February 07, 2010 @01:02PM (#31053028)

    ...that if women aren't highly represented in these endeavors, it might be a sign that women just aren't interested in the same damn things that men are?!

    Sheesh!

    • by noidentity (188756) on Sunday February 07, 2010 @01:09PM (#31053078)

      if women aren't highly represented in these endeavors, it might be a sign that women just aren't interested in the same damn things that men are?

      You've highlighted yet another gender gap that needs to be closed. We need to take stronger action to ensure that men and women are interested in all the same things!

      • Re: (Score:3, Funny)

        by Adambomb (118938)

        He must be from marketing!

        GET `IM!

      • by FooAtWFU (699187)
        I'll help you with quilting and embroidery as soon as you help me with approximate nonnegative matrix factorization and Team Fortress, dear. :)
      • You can laugh...but I've read articles on the issue from people who apparently hold exactly this position: that if girls and women aren't interested in tech, then we must find out how to *make* them interested, starting in the preteens.

    • I'm still upset at the misrepresented number of pregnant men.

      Seriously. 100% of females? I demand the government setup research to right this inequality.

    • by geekmux (1040042) on Sunday February 07, 2010 @02:06PM (#31053520)

      ...that if women aren't highly represented in these endeavors, it might be a sign that women just aren't interested in the same damn things that men are?!

      Sheesh!

      Thank you! Finally, someone said it. I mean seriously, would it come as a complete and utter shock sending Jesse Jackson on some sort of sexist/racist rant if he discovered that there were no men in the R&D department of Tampax? What, no male editors for Womens Fitness?!? Gee, there's only one female master mechanic in the tri-county area near my home?

      Some jobs are simply NOT appealing to women, period. It's not that they couldn't do the job. And I really get sick and tired of this kind of comparison being brought up every few months like we SHOULD be seriously worried about what gender sits behind a company instead of worrying about how good a given business plan is. The dot-bomb era was NOT because of gender imbalance in tech, management, or VC.

      And don't even think about pulling the racist/sexist card these days. A woman sits in the most powerful seat in Congress and a black man is running the United States. That speaks volumes from where we have come from in just a few decades. Bottom line is if a business plan is sound enough, a 12-year old could get funding.

    • by westlake (615356) on Sunday February 07, 2010 @02:40PM (#31053714)

      ...that if women aren't highly represented in these endeavors, it might be a sign that women just aren't interested in the same damn things that men are?!

      The same argument has been made historically to explain - and justify - the exclusion of women from every profession.

      The same argument has been used against those of other races and religions. It has never been far distant when the geek talks about outsourcing his work to India.

      Microsoft seems to care about this stuff:

      Women at Microsoft [microsoft.com], Women's Leadership Conference [conference-board.org]

      • Re: (Score:3, Insightful)

        by HuguesT (84078)

        Or the IEEE WIE [ieee.org].

        4% women engineers is not normal. I know, I married one, she dropped out of the profession not because of lack of capability or interest, but because of the lack of respect.

  • I've sometimes wondered about levels of testosterone and their link with "the desire to lead".

    Women and men are certainly mentally as capable as each other, but I wonder if there's a chemically induced motivation difference.
  • by markdavis (642305) on Sunday February 07, 2010 @01:07PM (#31053064)

    >"of the 237,843 firms founded in 2004, only 19% had women as primary owners. And only 3% of tech firms and 1% of high-tech firms were founded by women."

    Yes, we have discovered a massive conspiracy by society to prevent women from founding new companies. New evidence shows States refuse to give business licenses to women, especially if it is apparent it will be a high-tech company. News at 11....

  • So there are few women in technology. Sad. There are few men in primary or secondary education, nursing, or child care. Do we care?

  • As expected (Score:5, Interesting)

    by Just Some Guy (3352) <kirk+slashdot@strauser.com> on Sunday February 07, 2010 @01:08PM (#31053070) Homepage Journal

    If you believe that sociopaths are more likely to become effective CEOs, as has been claimed, then given that antisocial personality disorder is about 3 times more common among men than women, this is pretty much exactly what you'd expect.

  • by xtal (49134) on Sunday February 07, 2010 @01:08PM (#31053072)

    Film at 11.

  • management teams of companies like Apple — not even one woman.

    Well, it is Apple ... there's no *women*, but ...

    More seriously, it's interesting, but has little bearing on anything. Anyone done any studies on the lack (or excess) of LGBT in tech or venture capital?

  • by baronben (322394) <`ben.spigel' `at' `gmail.com'> on Sunday February 07, 2010 @01:18PM (#31053130) Homepage

    Okay, I guess I should get in here before it gets really bad. I'm a PhD student who studies entrepreneurship, so I've read a bit on the topic of gender discrimination and difference in entrepreneurship. In fact, I'm writing this instead of working on the lit review of my research proposal. There is plenty of evidence that women are discriminated when they look for loans or investments. A good read is Blake 2006 "Gendered Lending: Gender, Context and the Rules of Business Lending" in Venture Capital 8(2) pp. 183-201. Basisiaclly, there are pretty large, statistically signifigant, differences in loan approval rates between men and women, after controling for a host of factors like education, business plan, experience ect. Plenty of women applying for loans for high-tech businesses were told by the banker to instead start more traditionally women-oriented businesses like salons or clothes stores. On the venture capital side, access to venture capital is heavily dependent on social networks, if most venture capialists are men, then women will have a harder time getting into these networks. The old boys network still does exist, and it's hard to break in to.

    But why does this matter? The fact is that entrepreneurship is the only way that the American economy is going to grow. This is the best feature of our economy. So sure, I agree that women might not be equally as interested in entering the technical fields as men (though I'd say this is due in large part to implicit and explicit discrimination rather than anything biological). But we need all the entrepreneurs we can get. If women, who as you recall make up half the population, can't get a fair shake at starting high-tech firms poised for fast growth and export-base sales. we're doing the economy a disservice.

    • by barfy (256323)

      But we need all the entrepreneurs we can get. If women, who as you recall make up half the population, can't get a fair shake at starting high-tech firms poised for fast growth and export-base sales. we're doing the economy a disservice.

      Because we are not spending all the money? This is a crap statement, we would not be spending any more money here. The vast majority of companies that seek VC do not get VC. VC's really aren't leaving a ton of money on the table.

      It is a VERY hard game to break into, beca

      • Re: (Score:3, Insightful)

        by baronben (322394)

        Not everyone gets VC, and it's not an unlimited supply. The figures I'm looking at now from the Kauffman Foundation say about $230 billion in US in 2008.

        But, I don't think there's any reason to think that firms founded by women are any less productive or good targets for investment than those founded by men or by mixed-gender teams. In general, firms founded by women perform worse than by men, but this difference goes away once you look at firms in the same sectors (women are more likely to found firms in l

    • When considering loaning someone money, one must consider things the person is likely to do. Given that one cannot know the person in every detail, one uses the common behaviors of others similar to that person. Thus, when we, a Martian loan agency, are evaluating Earthlings for loans, we consider the behavior of other Earthlings, even though this particular specimen might not behave in the same way. Other Martian loan agencies have tried ignoring this, but they went under because their loans weren't as sou
    • There is plenty of evidence that women are discriminated when they look for loans or investments. A good read is Blake 2006 "Gendered Lending: Gender, Context and the Rules of Business Lending" in Venture Capital 8(2) pp. 183-201. Basisiaclly, there are pretty large, statistically signifigant, differences in loan approval rates between men and women, after controling for a host of factors like education, business plan, experience ect.

      I have looked up that study and I must say that I find the statements h

      • Re: (Score:2, Informative)

        by baronben (322394)

        Okay. I'm a geographer too, and I like that article, so I brought it up. If you want a more rigorous study, check out Coleman and Robb 2008 (http://ssrn.com/abstract=1260980). Right now it's just a working paper, but I think it's been accepted for publication. It's based off the Kauffman Firm Survey, which is a longitudinal survey of 4,928 entrepreneurs. It's get a crazy amount of data on all of them, like over 1,000 questions. It's an amazing resource, and even better, most of the data is publicly availabl

    • What we need are SUCCESSFUL entrepreneurs. You failed to mention what the return rate for VC's are on loans given to men vs. women. Successfully run VC's take into account EVERY aspect of the company they're giving money to. My dollar is on them getting consistently higher return rates from men...
    • by ffflala (793437)

      That's interesting. I just finished a semester on consumer protection law, with a heavy focus on Equal Credit Opportunity Act and similar measures that are designed to eliminate, among other things, gender discrimination in lending.

      A statistically significant disparity in loan approval ratings probably indicates that there are significant violations of the ECOA. This is curious, because the ECOA provides for considerable punitive damages for discriminatory lending practices. ($10k for individual actions and

  • If 3% of "tech firms" and 1% of "high-tech firms" were founded by women, and yet 19% are primarily owned by women, that seems to suggest that women position themselves very well in terms of getting to the top of these companies.

    In terms of founding firms, if one gender wants to found more firms --- then maybe they should just found more firms? I don't see how anything but the most abstruse and heavy-handed affirmative action is going to change that. ("Oh, you want a business license? But you're a male and

    • by a whoabot (706122)

      Sorry, I misread the "19%" as applying to just tech firms, when it was for all firms. That sort of throws out that part of my post.

  • it takes time (Score:5, Insightful)

    by CPE1704TKS (995414) on Sunday February 07, 2010 @01:23PM (#31053206)

    Silicon Valley is a meritocracy. People who get put in positions that they don't deserve, just because of their skin color or their gender might hold the title, but won't hold the respect or the credibility.

    I know plenty of females that are competent in terms of technology. But the ones who are in leadership positions right now started out in tech 20+ years ago. They were the first wave. Now, we have more females in the general ranks, and they will filter their way up. But it takes time.

    Force-feeding gender equality in a meritocracy won't work. They have to earn it just like everyone else. And when they do, no one will blink an eye or care, because everyone will think they deserve it.

    • by westlake (615356)

      Silicon Valley is a meritocracy.

      I wonder.

      Sloan Dean David Schmittlein was interviewing Douglas Leone, a partner at the venture capital firm Sequoia Capital and Sloan alum. Leone was dispensing advice about entrepreneurism when he let slip a remark that made me do a double take.
      Leone told the audience that Sequoia focuses on younger entrepreneurs because people over 30 aren't innovative. As a consolation prize, Leone said that the over-30 crowd could still make decent managers.
      The tendency of the social me

    • Re: (Score:3, Insightful)

      Well, Men outnumber women 4 to 1 or 5 to 1 in prison population too! Simple scientific fact is that there is more variation among men than in women. You will find more men at the bottom end of stupidity scale as well as at the top of intelligence scale. More men on the shorter side of the population as well as taller segment of the population. More men in risky all-or-nothing ventures as well as in safe-as-Fort-Knox job preferring bean counters.

      VC, company forming etc are off the well beaten path. No won

  • Guess we'd better force women at gunpoint to enter careers they wouldn't voluntarily choose to enter. After all, it's for their own good. And it makes the weak spined males feel better about themselves. Cuz that's what this is all about, isn't it?
    • Stop and ask yourself why they wouldn't voluntarily choose to enter the field. Could it be that gender-biased parenting and social norms influenced them not to pursue that path? If so, maybe we should be re-evaluating how we treat our children.

      Socialized gender differences aren't harmless. Do you think it's a good thing that most anorexics are female and most rapists are male? If women didn't develop eating disorders and men didn't rape, these horrible things would happen probably 90% less often in our soci

    • by dsoltesz (563978)
      As noted earlier, "You can lead a horse to water..." I don't know that the problem is discrimination, but perhaps more related to the question: Why don't girls play video games? Is it upbringing? Is it society? Is it education? Is technology presenting itself in a way that is simply not attractive to women? From my experience, women earn cred in the tech world the same way men do, and when they've earned it, they're treated equally. Techies are usually so eager to have anyone who understands what they do an
  • I'm trying to come up with something witty to say, but the only woman CEO that comes to mind is Carli Fiorina. That worked out well for HP...

    • Re:Carli Fiorina (Score:4, Interesting)

      by gestalt_n_pepper (991155) on Sunday February 07, 2010 @02:05PM (#31053504)

      Carli Fiorina was such a hugely pathetic failure at HP not because she is a woman, but because she zero engineering expertise (degrees in philosophy, medieval history and business if I'm remembering correctly). Apple found out the same thing when they hired John Scully to be CEO. Total fail. When non-engineers try and run tech companies, there seems to be a *much* higher probability of failure.

    • Carol Bartz. CEO of Autodesk, where she did well, then Yahoo, where she inherited a mess and isn't doing too well so far.

  • Division of labor (Score:4, Interesting)

    by vlm (69642) on Sunday February 07, 2010 @01:55PM (#31053444)

    Most comments seem to be from the outside looking in, looking from the big picture to the small.

    Try a different strategy. Look at the small picture and imagine it replicated a zillion times.

    So, the wife and I serve the evil empire at our corporate jobs. Due to gender quotas, etc, she's pretty much untouchable at a big enough corporation in her technical field. The only way it could be better for my wife, is if she were a minority. Me, I'm just another off the shelf white male tech dude. Which of us should stay in the corporate world to haul down some cash and (more importantly) health insurance? The replaceable cog in the machine man, or the quota'd fire-proof woman? Obviously the least risky solution is she keeps her day job, he forms the new company.

    Multiply by roughly 10000x and you get the reported numbers. No great surprise, really.

  • by NtroP (649992) on Sunday February 07, 2010 @02:07PM (#31053526)

    I do some "Angel" investing on occasion (I'm not at VC stage yet), meaning that I invest some of my money in promising startups. As much as it may seem that "the kids" have all the tech-saavy and good ideas, I look for startups that are lead by people with fairly extensive experience in both "tech" and business. That means that I'd be hard pressed to put my hard-earned money into a new company that's being run by a 25-year-old who is probably right out of college and has never run a business before. Now, I know that many of the great companies were started by kids with no business experience and I'm probably missing out on a good thing here. However, when I am presented with two competing proposals of otherwise equal potential where the difference is that one company is lead by a kid with no "real-world" experience and the other is lead by someone who's been in the field for 10-20 years, has run other businesses (even failed ones), I'll probably go for the experience - if all other factors are equal. In fact, I believe the youngest person I've ever funded was around 33 at the time.

    So, how does this fit in with the gender issue? I've been in the IT field since 1984 and I can tell you that girls were almost entirely absent from my field. What this means in terms of total experience today is that those in the high-tech field with the most experience tend to be predominately men. It would also follow that those with enough experience in their field who are seriously ready to both run a business that requires funding at the VC-level (i.e. millions of dollars) and have enough of a portfolio and background to attract VC would tend to be predominately men. Think about the ages of people running *most* large, successful companies; they tend to be in their 50's or older. Look back at how many women were in the workforce, getting management and "technical" experience in the 70's and 80's. Keeping in mind that during that time women really didn't have the same opportunities as men in the workplace and they tended toward more "traditional" positions - thus further reducing their potential experience in roles that would lead to high-level executive positions.

    Is this *fair* to women? Not really. They've always had to fight harder to be accepted into non-traditional roles in business. Is it *fair* to men for women to get moved into positions of authority simply because there aren't enough women in positions of authority? No. However, as someone who puts my money out there on the line, I'm looking for the best chance of a return that I can find. I don't care about the race, creed, color or gender of who's leading the company. I care about their chances of leading the company to success and my getting a return on my investment. Generally that will tend to lean toward those with experience, and in the technical fields that *tends* to be populated with males.

    Now, I'm always on the lookout for the exceptions...

  • by mc6809e (214243) on Sunday February 07, 2010 @02:23PM (#31053618)

    Homeless men greatly outnumber homeless women.
    Or how about fixing the died-on-the-job-gap, too?
    Men die more often on the job.
    Focusing on those few men that have been wildly successful is silly when so many other men are used and thrown away.

  • raising half a dozen children and later helping out with the grandchildren? On average, raising those children will have a bigger impact on society than spending her reproductive years on a career.

    If you wanted to cripple Western Civilization you could convince most of the smart women that they had to have careers, weigh down the middle class with taxes to curtail family size there, and give welfare to everyone else. Many people will beat the odds and more than a few trust fund brats will disappoint, but

  • Men are Riskier (Score:5, Interesting)

    by Doc Ruby (173196) on Sunday February 07, 2010 @02:36PM (#31053702) Homepage Journal

    Venture capitalists are risktakers. Tech top execs are risktakers. Overall execs are risktakers. Taking risks tends to send people to the extremes of their groups, bigger winners or bigger losers. Men tend to be at the top of professions, but also at the bottom, and in the lowest jobs, and without income at all. Men are much more likely to be injured by their jobs, to have risky jobs, and live shorter lives.

    Women tend to take fewer and less extreme risks, and tend to be in the middle of achievement, but more reliably achieve minimum standards of living.

    Biologically men are more expendable. Aggression gets more rewards, but it also takes more damage. The limiting factor on human population growth is the number of women, while even one man can produce an entire generation among all the women.

    There are social conventions held over from less developed societies that work to hold women back. And the bias towards training men to take risks and be expendable is an unfair gender bias now that the biological value isn't what determines social value.

    So long as risktaking is so different between men and women, rewardtaking is going to be similarly different. We could get closer to our inherent value regardless of gender's arbitrary constraints if we stopped ignoring the gender behavior that we are free to change, but don't, that affects success. And if we stopped ignoring the costs to either gender that come with either the achievement or the risktaking that underlies it.

  • So, Dunn & Bradstreet reports that 19% of all companies in all industries are run by women.

    And then it tells us 3% of tech firms were founded by women.

    And then it tells us that 1% of high-tech firms "as in Silicon Valley" were founded by women.

    Finally, it tells us that 9% of Venture Capital investments go to women-led companies (in some nebulous undefined "historical" time period) and for 2007 the figure is 3%.

    Let's see here ... 1% women led companies in Silicon Valley. 3% of VC funding.

    1%. Hmmm.

    3%. Hmm

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