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Scott Kirsner | Innovation Economy

3 things venture capital should do to bring more women into the business

Maria Cirino, cofounder of .406 Ventures in Boston, says the venture capital industry has a made a good start on tracking diversity. Wendy Maeda/Globe Staff/File 2014

Are things getting better or worse when it comes to women in the venture capital industry?

We don’t know, because no one is regularly collecting data on the issue. Not the National Venture Capital Association, the industry’s major trade association, and not the Cambridge-based New England Venture Capital Association.

Kind of odd, isn’t it, for a business that is obsessed with gathering data? Venture capitalists spend all day grilling founders about how many customers they have, how fast revenue is growing, and how big the total addressable market could be.

But the VC industry’s numbers don’t seem to be heading in the right direction. A 2014 report on the industry’s gender gap by Babson College found that the number of women making investment decisions at VC firms — what is typically known as a “general partner” role in the business — had declined from 10 percent in 1999 to 6 percent in 2014. Last October, Wayland angel investor John Landry looked at 22 firms based in Massachusetts that manage more than $20 million each, and found that only 3 percent of the people green-lighting new investments were women.

Why is this a big deal? “My core point is that it is suppressing innovation,” said Landry. “If 85 percent of consumer purchases are managed by women, it seems like a pretty big [incongruity] if 94 percent of people deciding to invest in new companies, nationwide, are men. It doesn’t make any sense.”


Meredith Flynn-Ripley, CEO of Cambridge text-messaging startup HeyWire, said that VCs often say that “they typically decide in the first three minutes of a pitch, ‘Is this someone that I like, is this someone that I want to spend a lot of time with, someone that I have things in common with?’ If that’s true — which I believe it is — that expectation only raises the bar even higher for women, because how many men are going to instantly feel comfortable with a woman?”


And Elizabeth Lawler, CEO of Conjur, a Waltham cybersecurity startup, observes that when male venture capitalists invest in a company, they join its board of directors. Often, that leads to companies still having all-male boards when they go public. (Lawler is the only woman on Conjur’s five-member board.)

The National Venture Capital Association last published data about the gender makeup of the industry in 2011, when 11 percent of survey respondents identified themselves as female investors (as opposed to support staff, handling operations, marketing, or recruiting). The association formed a diversity task force in 2014, and last August, more than 40 of the NVCA’s member firms signed a pledge to increase diversity as part of a White House event.

That pledge promised that the industry would release another report on diversity in the fall of 2015. But the report never came out, and NVCA communications vice president Ben Veghte told me this week that the association was “currently in the field” with a survey to measure female representation in the industry, along with other data points. “Can’t tell you when that will be released,” Veghte wrote via e-mail. Not exactly the epitome of urgency. (Veghte later explained that the initial survey produced “faulty data,” and that the association had engaged a new research firm to start again.)

Maria Cirino, cofounder of Boston-based .406 Ventures and a member of the NVCA task force, said that “I’d categorize it as a very good start. Do we have data? No. Are we working toward it? Yes. Do we have a long way to go? Yes. It’s a continual sort of drumbeat. Every time you show up at an NVCA event, you hear about [diversity].”


Jody Rose, executive director of the New England Venture Capital Association, said she is leaving it to the national group to collect data. But she said her group is working to promote opportunities for women in the tech industry more broadly, “through our support of organizations like SheStarts, Girls Who Code, WE_Bos, InnovationWomen,” and Capital W, a conference for female entrepreneurs held this month in Boston.

Collecting data on a biennial basis would keep the issue of women (and minorities) in venture capital on the front burner. But what would get things moving in the right direction, fast?

I’d suggest three things, all of which were backed up by the female entrepreneurs and investors with whom I spoke.

First, if Boston-area VC firms are, as Landry’s findings suggest, doing worse than the national average, why doesn’t the New England Venture Capital Association run a yearly one-day training program for its members, focused on overcoming unconscious biases in hiring, promotion, and making investments? There’d be no stigma that this is a problem for any specific firm, just something that would be constructive for every firm to participate in.

Second, where do venture capital firms get the money they invest? Much of it comes from pension funds and university endowments. They don’t typically report on the gender diversity of the venture firms they’re asking to manage their money, but it would be great for their retirees and donors to put pressure on them to do so.


Finally, women who get wealthy in the business world should be encouraged (and trained) to make investments as “angel investors,” and to put money into VC firms founded by women. One of the real pioneers in that area has been Golden Seeds, a New York-based group for women that offers training on how to become an investor.

In Boston, there are three relatively new funds that have at least one female investor as a founder: Project 11 Ventures, Assemble VC, and Glasswing Ventures.

Rudina Seseri, one of the founders of Glasswing, said, “Not having diversity of thought and points of view around the table hurts our business.”

For now, female entrepreneurs pitching all-male VC firms will just have to work a little bit harder. Entrepreneur Jill Kravetz recalls that when she was raising money for Gloss48, a now-defunct site that marketed independent beauty brands, she created a slide specifically to answer the question, “Do women really buy that many different beauty products?” It was a photo of a woman, annotated with 48 products from head to toe that many women purchase at least occasionally, from lip liner to pedicure tools.

The name for it? “The man slide.”

I’m looking forward to the day when female founders won’t have to include that one in their PowerPoint presentations.

Scott Kirsner can be reached at