Yes, Silicon Valley Is Still Awful to Women, But We Can Help

Women are making progress despite the system, and they need our help.

Women are still very much a minority in Silicon Valley. Fewer than 30% of tech workers are women, fewer than 20% board members, 17% startup founders and 8% investment partners. Many women feel that the system is rigged against them. It feels rigged when you were the only woman in your computer science class, get a job as an engineer in a highly competitive company, and are told that women aren’t suited to engineering. It feels rigged when Juicero raises millions of dollars in funding for pointless tech, and your breakthrough product doesn’t get funded because VCs think it’s a “women’s thing.” It feels rigged when they tell you maybe you should just go pitch female VCs – as if there are that many of them! – because maybe they’ll ‘get it’. It feels rigged if you are the only female partner in your firm, and your colleagues assume you’re only bringing that deal to the table because the company is led by a woman.

Despite this, women are making progress all over the Valley, supported by a community of women that acts as a safety net for us all. Some are turning to crowdfunding, e.g. Naya Health’s Kickstarter campaign, and Genneve’s IFundWomen campaign. New models are emerging, like SheEO’s ‘radical generosity’ idea of women supporting women with low-interest loans and opening up their network.

When I first moved from London to the Bay Area five years ago to join X, I knew hardly anyone here. My new team consisted mostly of introverted engineers; it took them two weeks to even start talking to me. I was lonely, like I had never been before in my life. Silicon Valley is famous for its networking, and I wasn’t part of the network. I reached out to Nilofer Merchant, an author who had promised to introduce me to people when I met her. To my surprise, she came through. She organised a gathering of ten women at her house in Los Gatos. There was good food, good wine, and a henna tattoo artist. Nothing like bonding with strangers while having your exposed midriff painted with henna flowers… By the end of the evening, I felt I had known those kickass women for years. They welcomed me into their community, introducing me to other fabulous women, to the concept of going for a hike instead of going for a drink, and to brightly coloured Tieks ballet flats that look as good in the office as on a hike.

Why do we still need women’s networks?

When I first moved here, I had no idea how much I would come to appreciate this community of women. In Europe, I had never been part of any women’s group. In the Valley, they are an essential survival mechanism. Ask any woman; they are likely to be a member of at least one women-only mailing list, women employee group, female CEO breakfast club or women on board initiative. They attend women robotics meetups, tech talks and conferences. Grace Hopper Celebration, the biggest gathering of women in computing, grew from 500 attendees in 1994 to over 18,000 this year. Since that first dinner at Nilofer’s house, I have hosted women events at my house and at X’s offices to pay it forward, introducing great women to each other who came as strangers and left as friends or collaborators.

I turned from a latent feminist into an active feminist as I discovered how much Silicon Valley’s system is rigged against women. Fewer than 30% of tech industry jobs are held by women. Fewer than 20% of board members are women. Only 17% of startup founders and 8% of investment partners at venture capital firms are women. Less than 10% of venture capital goes to companies founded by women. Liza Mundy wrote a well-researched piece in the Atlantic earlier this year, ‘Why is Silicon Valley so awful to women?’, which I pay homage to in my title. When I sent it round to friends and colleagues, many women wrote back and said they recognised the patterns.

I’m an incurable optimist, so I see the events of the past six months as a sign that things are changing for the better. First, women are starting to speak out and fight back against the bro culture, perhaps encouraged by Susan Fowler’s blog post and the upheaval that followed at Uber. Second, men are stepping up to support them. It was painful for Google’s female engineers when their hard-won credentials were being challenged yet again in James Damore’s ‘manifesto’, but there were plenty of voices who supported them both inside and outside the company. My favourite rebuttal of Damore’s arguments is a Medium post by Xoogler Yonatan Zunger who points out that senior engineers need people skills to be good at their job, not just coding skills. Third, companies are more transparent about their diversity data and taking more of a stance. In 2014, Google were first in the industry to publish its diversity data, and got flak for having fewer than 30% women. When ten other major tech companies quickly followed suit, it emerged that 30% was the industry average. Many tech companies now publish their data every year; at least they are willing to be held accountable. Google did fire Damore for breaking the company’s code of conduct and reiterated its commitment to diversity on its diversity website.

Progress is frustratingly slow in the corporate tech world, but the venture world is moving at an even more glacial speed.

Source: Crunchbase, May 2017

Crunchbase has been tracking female founder representation of U.S.-based companies since 2009. Their 2017 Female Founder report found that the percentage of female founders stubbornly remains at 17%; there has been no increase in the past five years.

In 2016, Crunchbase’s first Women in Venture report found that only 38% of the top 100 venture firms had at least one female partner, and only 7% of the total partners were female. In their 2017 report it had increased to 8% female partners. Change is slow because established firms add very few new partners. The landscape is more likely to shift thanks to a new crop of VC firms founded or co-founded by women, such as Aspect Ventures, Cowboy Ventures and Forerunner Ventures. At firms founded in the past five years who have at least one female co-founder, around 50% of the investment partners are women.

I have been mentoring startup founders in Europe since 2001, but I only started focusing on women after I moved to Silicon Valley. European female founders are also in the minority, but they are not as isolated. First, there are role models. One of the most high profile founders of the early dotcom era was a woman, Lastminute.com’s Martha Lane Fox. She went on to become the UK government’s digital inclusion czar and now sits in the UK House of Lords and on Twitter’s board. Second, cities like London and Berlin are not dominated by tech. Female tech founders are surrounded by high profile female leaders in media, finance and politics. The US chose not to elect a female president, but Germany and the UK are led by women.

In Silicon Valley, the few women who do start companies are surrounded by a male-dominated ecosystem: The last generation of successful founders who are now redeploying their money are all men (Skoll, Omidyar, Musk, Page, Brin, Andreessen, Horowitz, Thiel etc). Most VC investment partners are men. Most startup board members are men. Women are not part of the boys club, and many find it harder to raise capital.

Janica’s story: A typical Silicon Valley female founder story?

One female founder’s story was recently told by Bloomberg’s Emily Chang and Ellen Huet under the headline “A Smart Breastpump: Mothers love it, VCs don’t. The New Yorker’s Jessica Winter was even more blunt: “Why aren’t mothers worth anything to venture capitalists?”

I first met Janica Alvarez in February 2014 at the Women 2.0 conference in San Francisco, not long after she had founded Naya Health to make a better breast pump.

Photo: Janica Alvarez/ Naya Health

I had only recently stopped breastfeeding my daughter, so my memories were fresh. The stress of finding time in my calendar for pumping sessions labelled ‘moo time’, trying to maximize milk extraction while checking my email. The awkwardness of storing my milk in the communal fridge, wondering whether somebody would accidentally put it in their macchiato. Schlepping my enormous pump to conferences, freezing the milk and hoping it would not get confiscated by airport security on the way home. The embarrassment of doing conference calls during pumping sessions when I was desperate to get the time back, hoping other people on the call would not notice the sound of the pump. At least my office did have a mother’s room. Many mothers are not so lucky.

All these memories came flooding back to me as I listened to Janica telling me how she was designing a better breast pump. A pump that was comfortable to use, as efficient and fast as a hospital-grade pump with the size and weight of an ordinary pump, beautifully packaged so you would not be embarrassed to carry it through an office or airport. I decided there and then to invest in Janica’s angel round, ignoring advice from a seasoned VC who doesn’t invest in baby product companies while his kids are small because his brain won’t assess them neutrally. I definitely wasn’t neutral. I really wanted this product to come into the world. My due diligence consisted of a cursory glance at Naya’s revenue and cost projections which were wildly optimistic like most early stage startups, and asking a friend who was still breastfeeding to test the pump. She confirmed that it was indeed both comfortable and fast, and became an investor herself. Since then I have been working closely with Janica as she went on her journey to turn the pump from a concept to reality, figuring out manufacturing, distribution, marketing – and fundraising.

Fundraising for Naya was difficult from the start. Janica was a first time founder, and working on a product that didn’t neatly fit into categories. Consumer VCs were afraid of a medtech product that required FDA approval. Medtech VCs were afraid of a consumer product that required retail distribution and mass marketing. Male VCs didn’t understand Naya’s product, saying they had to ask their wife or sister about it. Janica was initially reluctant to tell investors that her co-founder was her husband Jeff, in case they didn’t want to invest in a husband/wife team. I convinced her to lean into it, since it was part of Naya’s origin story: When Janica struggled with her breast pump, her mechanical engineer husband Jeff took it apart and said, “There must be a better way to design this thing.” After male VCs commented on her figure and berated her for not being home with her children, Janica started taking Jeff to investor meetings. This came at a price: investors would mostly talk to him during the meetings.

Of course Janica is not alone. Another wife and husband duo, Victoria Ransom and Alain Chuard, had the same experience when they were fundraising for Wildfire, their social marketing company that eventually sold to Google for $350M. Overall Victoria doesn’t feel that she was discriminated against because she was a female founder, but she noticed differences in VC behaviour: “Investors would ask Alain all the questions, even though I was the CEO.” Earlier this year, I hosted a small summit of 20 women startup founders in the women’s health and baby space. Some are working on products that are even harder or more embarrassing to explain than a breastpump. Surbhi Sarna of nVision Medical is working on a diagnostic tool for ovarian cancer that is inserted via the vagina. Jill Angelo founded Genneve to help women deal better with menopause, a topic nobody likes to talk about. Liz Klinger of Lionessmakes a smart vibrator to improve female sexuality. You can imagine how their meetings with male VCs went.

We need more female VCs, but that won’t fix the problem entirely.

Many female founders I spoke to were at some point advised to pitch to female angels or VCs. The problem is that there are not that many of them, and the story of who invests in female founders is much more complex.

Over the past 10 years angel groups and VC firms have been emerging that focus on women, many of them founded by women themselves. Angel networks such as Astia Angels, Pipeline Angels, Broadway Angels and Golden Seeds invest in female-led companies, and train women in investing. Frustrated with conventional models, Trish Costello set up Portfolia, an investment platform. Crunchbase lists 25 organisations and firms investing in female and minority-led companies. However, most of these firms invest at the early stage of the pipeline, with the majority of VC funds controlled by established firms who are mostly male.

Interestingly, both Crunchbase’s Women in Venture 2017 report and analysis by Bloomberg found no evidence that firms with female investment partners are more likely to invest in female founders. In fact, Bloomberg found that some firms who fund a lot of women-led companies have no female partners at all.

Source: Bloomberg, May 2017