Women in VC: Fueling the Female Funnel

Over the last decade, the proportion of women partners categorized as key decision-makers in VC firms has declined from 10% to 5–8%. You can ask yourself, why is this an issue? The answer is simple: encouraging women into VC is just smart business. Women investors tend to invest in more women-led companies, which has been shown to improve the performance of VC firms as a whole. What’s more, as investors, they can help their portfolio companies succeed. It is in all of our best interests to encourage women to join the venture world (and then stay in and excel). When asking VC partners why they have fewer women in Investor positions in their fund, a scarily common answer is: ’There just isn’t a population of qualified women who want to become VCs.’ My hypothesis is that this is untrue but that we just don’t try hard enough to find female candidates.

In my 9 years of working experience in Recruitment, I have always been fortunate to work for international companies (such as Uber, OYO, Egon Zehnder, and BCG) and in diverse teams. In recent years, calls for greater diversity in the workplace have increased exponentially. When you add diverse voices to your teams, you do not only reflect society better, but you also learn things you wouldn’t have known otherwise, you build better products and you increase equity in the workplace and beyond.

Currently, I work at Antler, a Global VC. We find and enable the world’s most brilliant and determined individuals to build global businesses from the ground up. We are proud to say that 42% of our portfolio companies have at least one female co-founder. But why are other VCs lagging behind? Why does only 5% of VC Capital flow to diverse teams?

Because there are too few women making VC investment decisions. Various worthwhile initiatives have sought to increase the presence of women on both sides of the VC equation, but in my opinion, VC’s need to have gender-balanced investment teams, and hiring more females into your VC will require perhaps a little bit more effort, but bring a series of financial and non-financial benefits.

1. Referrals

Most companies cite referral programs as their “Most Effective Source of Hire.” However, there is also a risk of recruiting from the ‘inner circle’. The concern is that employees or people in your network refer candidates “like” them, which might end up creating a homogeneous candidate pool and hence hurt diversity. It’s an ongoing effort that requires attention and deliberate action. We need to continue to be mindful of diversity when implementing referral programs. Here are 2 suggestions to help you be mindful of diversity when implementing referral programs:

• Go broad: Companies have many people in their networks that they respect beyond employees. Consider engaging investors, portfolio companies, friends, alumni, and thought leaders in the space for a broader spectrum of referrals.
• Go blind: Many companies limit unconscious bias in their recruiting process by removing pictures and names when screening candidates. Think about how you can extend this practice when reviewing referred candidates.

2. LinkedIn sourcing:

You can source on Linkedin with Keywords and in this section drop most common female names.

You can also source for women using gendered phrases- these are fairly obvious: she, her, female woman, girls, etc.

By adding these to a search string you can now find even more talented female candidates on LinkedIn. Think about how people will phrase some of their recommendations for example, which are searchable, on a LinkedIn profile.

• “I worked with her on…”
• “she was my manager”
• “she was my direct report and I recommend her”

These words and phrases exist on people’s profiles, not necessarily in their bios but on their recommendations or the recommendations they have written for other people- this text is searchable on LinkedIn.

Searching for women’s colleges is another sure-fire way to find epic female candidates during your sourcing process. By searching for a list of traditional women’s colleges you can then incorporate these colleges and universities into your boolean search.

3. Interest groups:

By leveraging the amazing groups on Linkedin you can start building a really strong pool. There are plenty of examples of women-specific groups in the technology industry such as:

• European Women in VC
• Women in Finance
• Tech Savvy Women
• Fundright
• Female Investors Network (FIN)

4. Events:

You can host internal recruitment events, targeting certain groups, or you can partner with existing associations or simply attend events where you can scout female talent.

For example, PwC hosted Career Lounge events in various PwC locations. The format is simple. For one evening, female candidates invited to attend the event get the chance to meet and talk with female role models from across PwC’s consulting business.

5. Partner with Universities:

Universities are not only a great source for interns, but through their alumni networks, they can also support you in finding diverse Leadership candidates. For example; Vista Equity Partners actively recruits and hires diverse talent at its firm and across its portfolio of companies at all levels. Vista Equity Partners is helping to close the opportunity gap through initiatives like The Vista Frontier Fellows program — a summer internship program for women — and Vista also works with universities and organizations to find qualified candidates and — very importantly — invites other private equity firms to recruit from the pool of candidates.

6. Agencies:

While by no means exhaustive, the job boards and portals listed here are a great place to start when you have a new role to fill within your organization. They each attract diverse talent and empower underrepresented candidates to get their dream jobs.

7. Create public awareness

To really be an inclusive organization, your business leaders and HR teams are going to have to work together in building the right policies, programs, and initiatives. It is equally important to showcase the success of those initiatives by highlighting existing role models to the outside.

What else?

Whilst these are merely tips to increase the top of the funnel, that is not where things end. VCs will have to adapt their interview process; make sure you include female interviewers as part of the panel. Make sure you ask gender-neutral questions. Do not make a hiring decision before you have seen at least two diverse candidates at the final stage. You also need to make sure you build an inclusive culture — otherwise female candidates will not accept your offer or leave again before they complete their probation period. Pinterest, as part of their onboarding, had every employee participate in training to prevent unconscious bias.

Conclusion

Recruiting diverse talent starts with actively building a diverse pipeline. In this article, I shared some tips to diversify the top of the funnel. It is too easy and unfair to say there is less supply of strong female investment talent — but you will have to step out of your inner circle and take a more diligent approach to commit to having a diverse pipeline of candidates, a diverse interview panel, a fair evaluation process, and an inclusive culture.
The good thing is, it will pay off! The VC community as a whole should ensure they’re bringing in more women leaders into top positions.

Happy hiring!