Overcoming Sexism in Venture Funds and Silicon Valley
Only seven percent of partners in global venture funds are women, and the number who sit on the investment committees are much lower, according to the CrunchBase Women in Venture report from last year.
Women make up 85 percent of consumer purchases, according to Bloomberg, so their input is vital when it comes to macro-investment decisions.
Venture funds cannot be truly adding value for clients when they lack a complete understanding of the markets they serve, is the belief of Melissa Guzy, who runs Arbor Ventures, Asia’s largest financial technology (fin-tech)-focused venture fund, and one of the first venture capitalist companies in the world to be founded and led by women. Although Guzy has been a venture capitalist for the past 17 years she has never sat on a board of directors with another woman, she says.
To resolve this imbalance, the world needs more female entrepreneurs with start-up experience that can provide mentorship, says Guzy, who founded Arbor Ventures with Wei Hopeman in 2013.
“Companies, whether in technology or not, need diversity regardless of gender, race or religion. It is the diversity of a team that can change the world and foster innovation and ideas,” she says, in an interview in Hong Kong.
Guzy points to a slew of sexual harassment cases in Silicon Valley that have surfaced this summer, prompting a number of high-profile mea culpas and resignations from tech CEOs, including Dave McClure of investment firm 500 Startups; Marc Canter of Macromedia; Chris Sacca of Lowercase Capital; Binary Capital co-founders Justin Caldbeck and Jonathan Teo; and Uber founder Travis Kalanick.
“People can be forgiven for transgressions, but the recent events of Silicon Valley are not isolated nor are they new. Sexism in the Valley might be in the news lately but for any women entrepreneurs or venture capitalists, this behaviour has been the ‘norm’,” she adds.
Why is there such a sexist culture in an industry that in so many ways is progressive? “There’s a difference between IQ and EQ, and many of these CEOs have very high IQ but low EQ. And when it comes to start-ups, they are often on the verge of chaos, internal or external, and there’s so much to do every day that the idea of employee or people management is put off until later."
"As for venture capital firms, they have no excuse,” she adds.
Guzy says that this is not a new problem, but a number of cases coming to the fore at the same time have highlighted the issue. “Many women have kept quiet over the last two decades and the reason is simple. The reaction and the advice in the past was to keep quiet, as there is nothing to gain from the situation. This is true on an individual level, but collectively time will be lost in making progress for the next generation,” she says. “It’s not any better now than it was. Silicon Valley is a microcosm that lives in its own world. When we were raising our fund in Asia the only sexism we ran into was in California, which is supposed to be one of the most liberal cities in the world.”
When asked about how women should respond to the sexism issue, Guzy’s response is simple: “Ignore the noise and move forward but never lose respect for yourself and don’t hesitate to stand up for what is right. Being an entrepreneur and committing yourself to a start-up is not an easy road, and sexism is just one of the hurdles that we face along the way.”
Is having children a barrier to success as a woman? “Having kids and a career in the US can be far more challenging than in Asia," she says. "In the US the maternity leave is very short and you don’t have the same domestic helper support structure. In Silicon Valley it is hyper-competitive so if you pull yourself out for any amount of time, you’ve pulled out. But it’s a decision people have to make.”