Article Written by Dr. Susan Clark Muntean
Are you ever frustrated with the fact that the Big Tech companies, platforms, retailers, media conglomerates and really most large corporations across the globe don’t design their products and services in a way that best serves half the population? Those that lead corporations make decisions every day that impact women and our families in ways that don’t serve us well, contributing to a pipeline problem!
How can we get women seats at the head of the table across sectors and industries?
Let’s focus on the “pipeline problem”:
The growth rate of women launching their own businesses has been outpacing that of men for years. In terms of business ownership, women have risen the past decade from 30 percent to nearly 40 percent of business owners as females are founding businesses at nearly twice the rate of men. Yet in 2020, less than 3 percent of all venture capital investment dollars went to female founders.
Given this form of investment is the path to an initial public offering on a publicly listed stock exchange, this translates into a miniscule number of women heading up the Fortune and S&P500 companies. We need to fix this pipeline problem together!
The good news is there is nothing wrong with individual women; biases in the systems and institutions that serve entrepreneurs are what need to be fixed. As my research highlighted in Entrepreneurial Ecosystems: A Gender Perspective published by Cambridge University Press, much of the gender gap can be attributed to structural, attitudinal and institutional barriers, and not some deficit in individual women or among women as a category.
The advice women receive is also flawed.
Too often, women are advised to act more like men in their entrepreneurial endeavors. But individual women are not the primary source of the gender gap in equity finance either. The main barriers lie in our perceptions of women, entrepreneurs, and who is worthy of investment, mentoring, and other resources.
Here are the top five ways to close the gender gap in equity finance, without putting the onus on individual women to change who they are or what they are doing as founders.
- Ask women founders what they want and need, without judgment and by checking your assumptions about women and your stereotypes about entrepreneurs. Actively listen and design programming, resources, and support according to what women ask for. Women know best what they are striving for, what they are experiencing, and what barriers and issues they face as women. Understanding these challenges is the first step to designing solutions to resolve the underlying problems women face as entrepreneurs.
- Design your outreach, programming, and events in a way that is inclusive and represents women, their interests, and needs. For example, holding weekend-long hackathons and pitch competitions late into the night, with atmospheres invoking memories of college fraternity parties is likely to turn off too many women and make the probability of their participation and satisfaction greatly reduced. Instead, make sure events featuring panelists, keynote speakers and experienced mentors are representative of the population you seek to serve.
- Respect women’s ideas, competence, ambition, and capabilities. An all-too-common complaint among female founders is that they feel condescended to and assumed incompetent, or as a cute anomaly or exception, or both. You wouldn’t want your daughter to be treated this way, so give women the same level of respect, dignity, and treatment as men, which they deserve without question or hesitation.
- Commit to transparency, accountability, action, and change. If leaders, gatekeepers, decision makers, and investors cannot hold themselves and their organizations to account for closing it, the gender gap in business and entrepreneurship will continue as it has for decades, with 97 percent of all venture capital funds in an average year being invested solely in male founders and their ventures.
- Fix a common underlying source of the gender gap, which is something called implicit bias—that is, stereotyping that is unconscious or subconscious, but nevertheless ubiquitous and harmful. Investors, resource providers, and leaders of organizations that have a mission to support and fund entrepreneurs such as those who run accelerator programs, incubators, co-working spaces, small business development centers, angel investor networks, and venture capital firms are the primary source of implicit bias that works systemically against female founders. Fixing the bias requires awareness, training, and holding these important actors responsible for the choices they make. Reward decisions that promote gender equity. Use metrics to measure progress on closing the gap. When those responsible for inclusive economic development through entrepreneurship commit to inclusion, keep themselves accountable through transparency, accountability, and positive and negative consequences for choices made, we will see the needle change on who gets funding and which firms succeed.
Share these with your network and especially with the men and leaders of support organizations that want to do a better job serving women, but don’t know how to get started. Let’s solve the pipeline problem and shift the paradigm now!
Dr. Susan Clark Muntean is Associate Professor of Management at the University of North Carolina, Asheville. She is the author with Banu Ozkazanc-Pan of Entrepreneurial Ecosystems: A Gender Perspective published by Cambridge University Press.