How can we encourage more women into careers in Venture Capital?
Did you know:
- In 2019, women comprised just 13% and 15% of partners in U.S. and Canadian VC firms, respectively
- Companies with over 30% women on leadership teams tend to outperform companies with fewer women in leadership
- A 10% increase in women partners at VC firms resulted in a 1.5% increase in annual financial returns
So what can we do to encourage more women into careers in Venture Capital? (and ultimately encourage more investment into women-led ventures?)
Ethical Digital is on a mission to change the trajectory of the Internet. To study this issue, we worked with the Diversity Institute from the Toronto Metropolitan University and Neal Dempsey, Managing General Partner of Bay Partners to create this report “Women and the Venture Capital Industry in Canada and the United States”.
We interviewed men and women in venture capital from across North America about how to reduce the barriers for women entering into careers in VC.
Here are some of the highlighted recommendations:
- Attract young talent to the VC industry through the procurement of government subsidies for internship and/or co-op programs
- Seek better access to scholarships that are geared towards women entering VC occupations, further improving the recruitment and retention of women in the field
- Challenge bias by shifting investor mindset to be oriented with the principles of diversity and inclusion
This literature review forms part of The Allyship initiative. The Allyship aims to increase the representation of women in venture capital across North America to 30%. The Allyship is an initiative in collaboration with renowned venture capitalist Neal Dempsey, managing partner at Bay Partners in Silicon Valley. The Allyship as a movement aims to combat the underrepresentation of women in the venture capital industry through research and large-scale communications to accelerate the current pace of social change.
As part of The Allyship, Ethical Digital launched an intensive eight-month research project with the Diversity Institute at Ted Rogers School of Management to discover the barriers for women entering the profession. Results from the research will inform The Allyship’s large-scale industry awareness and action campaign that will function as a roadmap for venture capitalists, entrepreneurs pursuing investment, and policymakers. This research project aims to promote gender parity in venture capital in order to secure a brighter and more diverse future for technology entrepreneurs, and the next generation of women entering the venture capital industry.
The venture capital (VC) industry is a dynamic and growing field that has significant contributions to Canada and the U.S.’s economic prosperity. Despite advancements in the field, barriers still exist for the career entrance, retention and advancement of women and their representation at all career levels. As the field continues to develop, researchers and practitioners alike are tasked with finding the “best practices” to remedying inadequacies that emerge, often coming short of a one-size-fits-all approach due to limited research.
This report aims to fill this knowledge gap by providing a synthesis of the current state of women’s representation in the VC ecosystem in Canada and the U.S. It begins with a detailed overview of the extant literature on the VC ecosystem in Canada with comparisons to the U.S. and United Kingdom, situating the significance of women’s representation and the need for change. Discussion continues by challenging current policies and practices in the field through the analysis of 15 interviews by key women VC senior leaders in Canada and the U.S. Findings that emerge call for judicious leadership for advancing the entry and advancement of women in VC firms and provide action oriented recommendations at the societal (macro), organizational (meso) and individual (micro) levels of the VC ecosystem.