Capital Gains: Women, Babies, And Getting Ahead In BusinessS

Where are all the female entrepreneurs? Vivek Wadhwa and Stacey Higginbotham both wonder why women are less likely to be in the top ranks of the business world. Is it gender bias? Baby bias? Or an infuriating combination of both?

Wadhwa, writing for Tech Crunch, uses his piece to tackle common perceptions of women in the workplace.

Is the background or motivation of women that prevents them from becoming entrepreneurs? I just completed a project with National Center for Women & Information Technology (NCWIT) to find out (Kauffman Foundation will be releasing our research paper this spring). Our analysis of 549 successful startups showed there was virtually no difference in motivation between men and women entrepreneurs. Just like men, women started companies because they wanted to build wealth, capitalize on business ideas they had, liked the startup company culture, and were tired of working for others and wanted to be their own boss.

Tech Crunch utilizes a chart to illustrate that education-wise, there's very little difference between the education levels of men and women entrepreneurs.

Capital Gains: Women, Babies, And Getting Ahead In BusinessS

So if education levels are more or less equal, and the motivations are the same, why are so few women reaching the same professional heights as their male counterparts? Gender bias begins to loom large when Wadhwa begins asking successful entrepreneurs about their experiences in the venture capital pipeline. Venture capital is necessary for many entrepreneurs (particularly those working in technology) to move to the next level. In order to obtain millions of dollars for a business, many entrepreneurs seek out this type of funding from specialized firms, and submit their business plans, ideas for expansion, and revenue projections in hopes of enticing a venture capital firm to invest. However, this process can be a bit different for men and women.

Shaherose Charania, of Women 2.0, thinks it is because women have had few role models and mentors. Additionally, it is harder for women to obtain funding than for men. She notes that historically, women-led companies have received less than 9% of venture capital investments; in 2007, the proportion of funded female CEOs dropped to 3%. And there is another problem which her group works hard to overcome: some old-time VCs won't give women the time of day. Her group members recount examples of VCs and angel investors interrupting pitches to ask questions and make comments like:

* When are you planning to have kids?
* Why isn't "he" the CEO?
* So you moved here because your husband lives here? What if he has to move for work one day? Will you go with him?
* You should cut your hair, dress a bit more manly if you want to be CEO.

Wadhwa also speaks to Sharon Vosmek, CEO of venture accelerator Astia, who discusses the idea that the venture capital industry is operating with some level of systemic bias that disadvantages women. She argues that it isn't so much blatant discrimination, but a lot of factors that effectively stack the decks against females. Vosmek points out that since many business networks are segregated by gender, women are less likely to be in the "natural networks" that would lead to funding. In addition, Vosmek talks about "pattern recognition" - how many venture capitalists want to invest in a sure thing - and for many successful start ups, the common denominator has been "founders who were white, male, under 30, nerds, with no social life who dropped out of Harvard or Stanford (2009 NVCA conference)."

Wadhwa promises to produce a second column with solutions, but another writer has already jumped into the fray. Over on GigaOM, Stacey Higginbotham has a theory: the gap isn't due to education levels or experience, but rather perceptions about women and parenting. She discusses the thrust of Wadhwa's article, before explaining:

[I]t was a comment from TechCrunch reader Chem that actually laid bare the issue of why women aren't better represented in tech - essentially, it's because women have babies, and the perception is that when we do, we leave the workforce to take care of them. And while Chem's stereotype isn't correct ( I was back at work and even took on a more demanding job soon after my daughter was born), the fact that women are "supposed" to bear the brunt of raising children is a huge reason why women aren't more visible at the helm of venture-backed startups. It's the babies, stupid.

Or rather, it's the idea that women should shoulder the burden of raising children, an idea that dominates our society to such a degree that many women and men buy into it without question.

Higginbotham is correct - perceptions of women at work are always shaded by ideas of parenting and commitment. She also points to the framing of parental responsibilities in society, and mentions the prevalence of articles that highlight women struggling to balance their work and home lives, appearing alongside articles that treat men who take an active role in parenting as interesting anomalies. Higginbotham concludes;

We can bemoan a scarcity of female role models in tech, entice women into the math and science professions or even blame women who leave the work force to take care of kids for the lack of gender diversity, but to fix the problem, we're going to have to discuss the lack of parity between men and women when it comes to raising children.

Silicon Valley: You and Some of Your VC's have a Gender Problem [Tech Crunch]
Silicon Valley Has a Woman Problem, But Women Still Have a Baby Problem

Earlier: If There Were More Female Executives, We Would Have A Different Business World