This article appears in the Oct. 26 issue of the Magazine.
BOSTON’S STARTUP COMMUNITY has long resided in the shadows of Silicon Valley, which lays claim to the most venture capital investments, bigger IPOs, more tech-sector jobs, and, sure, even better weather. But a bold idea is taking shape: Could the Boston area become the more hospitable alternative to the Silicon Valley goliath, an innovation hub that supports women, values diversity, and champions work-life balance?
To many, the idea doesn’t seem that far-fetched. “Boston already has a much more inclusive way of operating — leverage that further, and it could be a competitive advantage for this tech community,” says C.A. Webb, the executive director of the New England Venture Capital Association in Cambridge. “Boston isn’t as flashy or as social or as superficial, frankly, as other communities can be. I think the advantage of that is that there isn’t as much artifice that ends up creating walls where people can visibly see they’re being excluded and this isn’t a place for them.”
Tech leaders say two factors are already working in Boston’s favor: The limited geography of its startup community makes close-knit networks inevitable, and experienced women have proved willing to extend a hand to younger peers. “Silicon Valley is very spread out,” says Anita Brearton, cofounder of the marketing platform CabinetM in Boston and cofounder of the city’s Women’s Entrepreneurial Council. Here, “you have Boston and Cambridge and now Somerville, and it’s all very accessible. We have wonderful universities, a lot of investors, there are accelerators, formal meet-ups, a rich ecosystem in a geographically dense area where everyone is tightly connected and everybody knows everybody.”
This is not to say that Silicon Valley is against supportive networks, but the area continues to be known for its hoodie-wearing, code-obsessed young white male solo entrepreneurs. Data released this year by Silicon Valley heavyweights Facebook, Google, Yahoo, and Linked-In confirmed their workforce is overwhelmingly male and white or Asian. Even the fictional HBO show Silicon Valley, which caricatures the startup scene, was called out by critics for having its own gender problem: The first season featured only one recurring female character, who serves as an assistant to a male venture capitalist. Silicon Valley, the real one, has also been called out time and again for perpetuating a “culture of failure,” where the popular mantra among young founders is “fail fast, fail often.” An oft-cited (but inaccurate) statistic is that nine out of 10 startups fail. This culture is virtually absent in the Boston area. Instead, the region’s overarching attitude is that it can take many years to build a stable company, according to Jules Pieri, cofounder and CEO of The Grommet, a product launch platform in Somerville. As a result, companies have more time to consider rounding out their team. “In Silicon Valley . . . you can get away with — and still be an attractive candidate — a resume that would really be a non-starter here in Boston,” Pieri says. It’s seen as inefficient and expensive to build a team around someone who might just up and leave within the year, she explains.
As the region works to differentiate itself from the Valley, more investors are noticing. According to the National Venture Capital Association, Massachusetts was the top VC fund-raising state in 2013 at $5.5 billion; California, usually the leader, came in at $5.3 billion. Meanwhile, in March, Governor Deval Patrick launched the Women in the Workplace Initiative that aims to advance women in all industries in the state; earlier this month, that initiative included a challenge to get 100 companies to agree to adopt women- and family-friendly policies. And in June, more than 140 of the state’s top CEOs and business leaders gathered at MIT to, as the event’s organizers described it, advance Massachusetts’s “competitive position in the global economy by closing the gender wage gap and increasing the number of women on boards of directors.”
For many, it’s beginning to feel like a movement. “There’s a lot going on in Boston to support women entrepreneurs,” says Joshua Henderson, vice president of Springboard Enterprises, a nonprofit that backs female-led ventures and runs programming for women across the country. The Boston area, he says, has the highest concentration of participating entrepreneurs. “I’ve seen more here than in any other city,” he says.
ALL THIS GLOWING TALK is not to say there isn’t room for improvement in Boston’s startup universe. Some businesswomen say they still face subtle gender-related discrimination. “People would look at me and assume that I didn’t have any technical skills . . . and that used to irritate me. It still does irritate me,” says Emily Green, CEO of Boston-based Smart Lunches, an online ordering and food delivery service. Jennifer Lum, cofounder and chief strategy officer of the advertising service Adelphic Mobile of Waltham, writes in an e-mail: “Many times when I’m scheduling meetings, assistants will assume that I’m an assistant rather than a meeting participant.”
Some complain that the startup social scene — where all-important networking takes place — skews toward men with offerings like Beer O’Clock. “There’s this certain vibe — this professional relationship that men have with each other that women don’t have with men,” says Lauren Abda, founder of Boston-based Branchfood, which sets up events focused on food innovation, and managing director of the South End office space called The Food Loft. “I don’t want to say I’m excluded from that.” Abda adds, though, that she’s “not invited on the founder-meeting golfing things they go on or the sailing things that they go on.” She pins this dynamic to the proportional presence of men in her field, not to any intentional malice. “I still feel like the majority of founders are men and they kind of just want to hang out with themselves.”
There’s also the matter of funding. Maria Cirino, cofounder and managing director of the Boston VC group .406 Ventures, describes the innocuous process by which venture firms end up becoming “male bastions.” “You’ve heard the stories: Tommy and Bobby used to work together, then they founded the firm together, and they find other Tommies and Bobbies,” she says. “Having been in VC for eight years, this strikes me much more. Senior partners who are women are so few and far between.” Cirino calls the lack of women in top positions at venture capital groups a “black eye for the industry,” which prides itself on ideas like innovation and disruption.
According to Webb of the New England Venture Capital Association, pitches to and conversations with potential funders often take place as a result of “outbound” efforts — VCs reaching out directly to companies and people whose work they find intriguing. “So long as investors remain a modular group of people,” she says, “the likelihood is that they socialize with people like them, and people like them will continue to be funded.” Ambar Bhattacharyya, a vice president at the Cambridge office of Bessemer Venture Partners, notes that his firm attempts a more inclusive approach. “We’ve historically been very thematic, very proactive in terms of seeking out companies,” he explains. “Certainly we’ll get introductions to companies and we’ll get intermediaries to send companies our way.”
It’s clear that seemingly harmless missed opportunities to share coffee with an investor are also missed opportunities to make important connections. “If you’re going to start a business, you never go in blind. You need a warm introduction. . . . You stand a far better chance raising capital,” says Brearton of the Women’s Entrepreneurial Council. “Historically, women just haven’t been in those circles.”
IF THE BOSTON STARTUP community really is aiming to cement its image as more inclusive than Silicon Valley, tech leaders say both women and men must recognize and work toward this goal. After participating in several sessions at the SXSW Interactive Festival in Austin, Texas, last March, Henderson of Springboard Enterprises found that even including the word “women” in a presentation title changed attendance demographics. By the end of a session on promoting female entrepreneurs, the only men remaining in the room were members of the panel. When the topic was a general one on funding, the demographics of the room swung the other way — mostly men, with a handful of women.
“Women talking to women isn’t enough,” says Teresa Nelson, an entrepreneurship professor at Simmons College. “Sometimes men feel like they’re not welcome at meetings we have, or they ask, ‘Is it OK if I come? Do you want men on your board?’ ” she notes. “It’s a problem when good men think of this as a women’s issue, not just a social issue.”
Local startup leaders say companies need to be deliberate in their hiring methods. “It’s important to make sure you have men and women at recruiting events — women go to tables that have women there,” says Dulcie Madden, cofounder and CEO of Boston-based Mimo, which produces “smart” baby monitors. “We get equal spread of applicants and then go
gender-agnostic from there.” She believes it’s important for women to be included in a company’s founding team or first five hires. Betsy Myers, founding director of Bentley University’s Center for Women and Business, notes: “Young women ask: ‘Is there someone in that company that looks like me?’ ” Myers says a firm’s entire executive team must prioritize diversity. “We can’t do it alone — it has to be integrated into the fabric of the organization,” she says. “If the CEO doesn’t think it matters, it’s not going to change.”
Beyond hiring decisions, companies need to promote the development of female employees and encourage work-life balance, some tech leaders say. For instance, Kyruus, a Boston firm that helps hospital networks improve their patient access and referral systems, has developed a way to address cases where men might have negotiated a higher starting salary: The company periodically runs analyses of all its job offers and aims to bring everyone up to fair market rates. It is similarly generous about employee time off. “We are completely flexible about people needing to take time off to spend with their families,” says Julie Yoo, Kyruus cofounder and chief product officer. “It’s extremely important to us that our company culture encourages camaraderie right off the bat.”
And while some mentorship of Boston area women already takes place, there are calls for increased levels. “We could certainly use more women entrepreneurs,” says Christina Chase, a lecturer and entrepreneur-in-residence at the Martin Trust Center for MIT Entrepreneurship. “There are no clear, easy fixes, but from my perspective, it means mentoring young women to know it’s possible, giving them the confidence to take riskier paths and the tools to de-risk that path.”
Growing the ranks of businesswomen and giving them more startup opportunities makes sense from a fairness point of view. But experts say there’s another reason: Studies have shown that companies with women on the board or in other leadership roles have better financial performance than those without.
The growing momentum to diversify our startup community, then, makes business sense. To put it simply: Boston is not Silicon Valley. It can be better.
FEMALE ENTREPRENEURS AT A GLANCE
15% — Percentage of US companies receiving venture capital investment in 2011-2013 that had a woman on the executive team (in 1999, it was fewer than 5 percent)
2.7% — Percentage that had a female CEO
> Companies with exclusively male executive teams are more than four times as likely to get venture capital funding
6% — Percentage of partners at US venture capital firms who were women
> Venture capital firms with female partners are three times more likely to invest in companies with female CEOs
California, New York, and Massachusetts
States with the highest number of investments in companies with women on the executive team (these three also have the largest number of venture capital investments)
For advice for female entrepreneurs from women leaders in Boston’s startup community, read BetaBoston’s “How to succeed as a woman entrepreneur.”
Correction: An earlier version of this story incorrectly referred to the way the Boston firm Kyruus handles salaries.