In chapter after chapter of this book, you have read inspiring stories of innovating women who defied the odds and achieved success. Each had a different background, motivation, and potential. Each had a different path to success. There was no single problem or solution. That is why we decided to crowdcreate this book—so that we can learn from women from different walks of life, all over the world. Every woman’s circumstance is different, and each must look within herself to understand what it will take for her to rise and achieve her potential. To increase the chances of success, they must learn from the experiences of others and work together.
It is no doubt harder for women to gain funding, mentorship, support, and connections than it is for men. The deck has been stacked against them. Women see the technology industry as a boys club, so they are shying away from studying computer science. Their proportion in computer science programs dropped from 37 percent in 1987 to 18 percent by 2012. When women join technology companies, they often get discouraged because they are the only women in a group and are treated differently from everyone else, or they are discriminated against—either deliberately or because of a subconscious bias. When women choose to start technology companies, they face rejection—and abuse—by a venture capital system that is dominated by males. Dan Primack of Fortune magazine calculated[1] that as of 2014, only 4 percent of senior investment partners at venture firms are women—and he found none at the heavy-hitters. Heidi Roizen brought to light the perils that women face in her very powerful essay. Few women are able to navigate these treacherous waters.
But things are changing for the better on all of these fronts, especially in Silicon Valley. There is a growing awareness of the problem, solutions are being discussed and implemented, women are beginning to help each other, and the venture capital system is looking at itself critically and mending its ways. Most importantly, as we will discuss in the next chapter, the investment community is becoming less relevant because the cost of creating world-changing technologies is dropping dramatically and allowing women as well as liberated men to work on solving real world problems using exponential technologies.
First, Admit There Is a Problem
With any social problem, the tendency is to first deny it exists and then to blame the victim. Silicon Valley has considered itself to be the perfect meritocracy—it can do no wrong. Admitting that there may indeed be a problem has held its evolution back.
When, in Feb 2010, I wrote the piece for TechCrunch titled “Silicon Valley: You and Some of Your VCs have a Gender Problem,” not only did it create a firestorm on social media, but it—and articles by journalists who had views similar to mine—triggered off a series of defensive blogs and commentary. The central argument was that men were very interested in promoting and helping women, but there are too few women in the technology space because it is not for them—that they lacked the capability, motivation, or interest.
These blogs weren’t just written by men; some women also chimed in. A few venture capitalists and technology company executives endorsed and promoted these on social media. There was a barrage of negative comments, such as those I detailed in the introduction.
Women who speak up are used to barrages of angry and sometimes hateful comments. I can only imagine how they must feel. I was really shaken up at having my academic credentials challenged and being called a fraud. I was grateful for the strong support from two of Silicon Valley’s most respected entrepreneurs: Eric Ries and Brad Feld, who wrote on his blog[2]:
I’m extremely impressed with Vivek Wadhwa’s posts on TechCrunch. He’s been blogging periodically for them since last fall and has shown that he’s willing to take on difficult, controversial, and complicated issues and discuss them in data-driven and systematic ways…The comments, however, were really enlightening to me. The amount of anger and hostility, especially irrational attacks, surprised me. Well—I guess it only surprised me a little—it mostly disappointed me.
But in May 2014, I was invited to give two talks about women in technology at the National Venture Capital Association’s (NVCA) marquee conference, Venturescape. I asked Venky Ganesan, who was chairing the event and had invited me, whether I was walking into some kind of ambush. I joked on Twitter that I felt like a hen going into the foxhouse. After all, the group that I had been most vigorously attacking had offered to put me on center stage and let me speak my mind.
I could not believe the respect I was shown at the event and that the audience of VCs cheered when I criticized their system for being male-dominated and demanded that it be changed. Senior executives of NVCA also told me that they agreed that their member firms needed to be proactive in correcting the gender imbalance. They agreed with what I had asked—that VC firms publish diversity data on their investments and that the NVCA should showcase firms that are exemplary. Venture capitalist Jeff Bussgang, who was on a panel with me, also wrote a blog for Huffington Post, “Cultural Dysfunction: The Lack of Women in VC.” He acknowledged that there was a system-wide problem, discussed remedies, and concluded, “As with any hard problem, there is no silver bullet. But asking hard questions is what VCs are supposed to be good at, and this is an area where some really hard questions need to be asked.”
For all the bad things you can say about Silicon Valley and venture capitalists, you have to give them credit for being open to criticism, listening very carefully, and being proactive in bettering themselves. This is what gives Silicon Valley a global advantage: dissent is encouraged, and learning and reinvention are the norm. There is nothing wrong with saying I made a mistake and am now doing things differently. They even have a special word for failure in the valley: it is called “pivoting.”
Today, there is a chorus of female and male bloggers, business executives, and venture capitalists who are openly discussing the problems and solutions. Silicon Valley is pivoting. The prominent investors who were attacking me for writing about gender discrimination have largely gone silent on this issue. Not a peep of disagreement or disparaging word dares to come from them anymore.
It Starts from the Top
The gender imbalance is not only endemic in the lower echelons; it is even worse in the executive ranks and on the boards of technology firms. There are few women in senior executive positions and even fewer on boards. African-Americans and Latinos are practically nonexistent.
The problems start at the top and flow down through the ranks. That is why the boards need to be fixed first.
Twitter made big waves when it revealed its IPO filing in October 2013. This showed that all of Twitter’s board members were male, as were all of its executives, other than one lawyer whom the company added a few weeks earlier, and all of its key investors. In an interview with Claire Miller of the New York Times, I said that this exemplified the elite arrogance of the Silicon Valley mafia, the Twitter mafia, and its male chauvinistic thinking; how dare they think they could get away with this?
You can’t blame a technology startup for having a board that looks like a boys club while it is a private entity because it can’t usually pick and choose its investors. They make board seats a condition of their investment. But everything changes when a company goes public. The duty of a board is to look after the interests of all shareholders and to maximize the company’s value—not just the few that originally invested in it and reaped fortunes. It isn’t about diversity for the sake of diversity. Having women on boards produces better outcomes. Companies with the highest proportions of women board directors outperform those with the lowest proportions by 53 percent. They have a 42 percent higher return on sales and a 66 percent higher return on invested capital. A board that reflects a company’s user base is more likely also to understand its market needs and to develop better marketing strategies.
Rather than respond to the issue, Twitter CEO Dick Costolo chose to attack me by tweeting “Vivek Wadhwa is the Carrot Top of academic sources,” and several of Silicon Valley’s moguls favorited or retweeted his message (this usually implies endorsement or support). But, fortunately, things had progressed enough that there was uproar about his comments. There were hundreds of articles in the press, and men and women both expressed strong disapproval on social media and in blogs.
I didn’t for a moment think that Dick Costolo was (or is) sexist or that he deliberately discriminates; he was just reflecting the frat boy behavior that is common in Silicon Valley. This may have been okay when the tech industry was in its infancy and companies such as Twitter didn’t get the national attention they do now. But in this day and age, they cannot get away with it.
Twitter handled this matter very badly—despite loud calls to add women to the board, they refused to budge for weeks. This is really bad public relations strategy because it made the criticism get louder. Finally, the company announced the addition of a board member: Marjorie Scardino, former chief executive of publishing giant Pearson. Since then, there has been a flurry of announcements of technology companies adding woman board members. Twitter’s PR bungle may have accelerated important progress.
One woman board member isn’t enough, however, no matter how competent or outspoken she is. Research shows that board productivity increases the most when there are three or more women on boards. So a lot more needs to be done at Twitter and other companies.
Technology companies have a lot to be embarrassed about when it comes to gender diversity. If they released gender and race diversity data, it would shine a light on their flawed employment practices and the public would apply pressure for change. That is why they have steadfastly refused to release these.
In 2008, Mike Swift, of the San Jose Mercury News, began probing the topic of gender and race diversity by sending Freedom of Information Act requests to Silicon Valley’s fifteen largest employers. He lost an eighteen-month battle with five of the top companies.
In 2011, CNN launched its investigation and demanded data from twenty of the most influential U.S. technology companies, the Department of Labor, and the Equal Employment Opportunity Commission. It filed two Freedom of Information Act requests for workforce diversity data. Only Dell, Ingram Micro, and Intel complied. Later it forced the Department of Labor to release what data it had for Cisco and Ebay. Apple, Google, Hewlett-Packard, IBM, and Microsoft all successfully petitioned the Department of Labor for their data to be excluded because releasing it would cause “competitive harm.” Several companies gave CNN the familiar excuse: that they had a “pipeline problem” because too few women and members of ethnic minorities are graduating with technical degrees.
The data that was available revealed what we would expect: that the numbers of women are extremely low and Hispanics and African-Americans are hardly to be found.
In October 2013, a young engineer at Pinterest —an innovating woman—Tracy Chou decided to do something about this herself. She set up an open-source spreadsheet on Github to collect gender data. She asked her friends and their friends to input data about the companies or departments that they worked at.
In March 2014, Rev. Jesse Jackson joined the fray by leading a delegation to Hewlett-Packard’s annual shareholders to bring attention to Silicon Valley’s poor record of including blacks and Latinos in hiring, board appointments, and startup funding.
The breakthrough came on May 25, 2014, when Google broke ranks with the technology industry and released its diversity data. It revealed that only 17 percent of its technology workforce was female—not impressive, but better than most. And Google pledged to work toward increasing that figure.
Google’s breaking ranks had the very positive effect that I expected it would. On June 12, 2014, LinkedIn followed suit and released its gender data. Its workforce is 61 percent male and 53 percent white compared to Google, which is 70 percent male and 61 percent white. It did not break the data down by engineering, most likely because it would have fared worse than Google. On June 17, 2014, Yahoo! released it numbers: only 15 percent of its technology workforce is female. It, too, pledged to increase diversity. On June 25, Facebook chimed in with their numbers (15 percent female) and pledge.
I expect that many other companies will follow suit. At the least, they are looking at themselves more closely in the mirror.
How to Correct the Gender Gap
A common excuse for the lack of women in technology companies is that women simply aren’t available. I heard the same from a startup, Humin, that I have been mentoring and joined the board of.
“We’d love to have women on our engineering team, but we just can’t find any—no matter how hard we try. I know that we need to have a team that understands the product needs of more than just the young male user,” said founder Ankur Jain Humin’s first board meeting in May 2013.
“Not good enough; change the recruiting specs, network with women’s groups, do whatever it takes,” was my response. I was being uncharacteristically harsh to a young man I considered to be extremely brilliant and open-minded. I knew I wasn’t being reasonable, but considered it my responsibility as a board member to raise this important issue. Ankur and his three college buddies had just moved their mobile-software-platform startup to San Francisco. Competition for talent is fierce in Silicon Valley, and it is difficult for startups to compete with the likes of Google and Facebook—which sometimes offer million-dollar sign-up packages.
I advised the Humin team to network with women’s groups and look harder. And that is what they did. Humin’s VP of product and engineering, Percy Rajani, revamped their interviewing process to look for top talent in unconventional places rather than just looking for former employees of other well-known tech companies. He knew that the company could teach programming languages and processes, but intelligence, motivation, and personality were the key traits to recruit.
Humin did succeed in assembling an exceptional and diverse engineering team. By broadening their search process, they found a depth and breadth of female talent, especially among developers whose original background was in engineering fields outside of computer science. Today, six of Humin’s engineering team of 18—or 33 percent—are women. Two of the women are PhDs.
Xerox CTO Sophie Vandebroek also found a way to fix the gender balance in her team by doing in-college hiring and creating a culture and work environment that was appealing to women engineers. More than 40 percent of her teams’ engineering departments hire women; in some years, it’s more than 50 percent. She takes pride in being able to attract people from all different colors, from different genders, and of different ages.
Technology companies also need to look at who does the hiring and how. “If someone came in right now and announced that the zombie apocalypse had just started outside, what would you do in the next hour? What is something that you’re geeky about? What is a superpower you would give to your best friend?” These are the types of questions that many technology companies, including Google, Amazon, Dell, and Dropbox, used to ask interviewees. Interviewers—who tend to be young men—often believe that such questions help them identify creative people, while making the interviews more fun. The problem is that such questions are fun only for people who understand the jokes—and who can think like the interviewers do.
They don’t lead to better hiring outcomes, as Google learned. Its senior vice president for people operations, Laszlo Bock, said in a June 2013 interview with the New York Times, “…we found that brainteasers are a complete waste of time. How many golf balls can you fit into an airplane? How many gas stations in Manhattan? A complete waste of time. They don’t predict anything. They serve primarily to make the interviewer feel smart.”
After hearing from concerned female employees at Dropbox about hiring practices there and attempting to contact the CEO and the media relations team, I wrote an article titled “Dropbox’s hiring practices explain its disappointing lack of female employees,”[3] criticizing the company in February of 2014.
I quoted Level Playing Field founder Freada Kapor Klein, who said, “Dropbox executives, like other startup founders, honestly believe they are a meritocracy and are unaware as to how hidden bias operates. Employee referrals play a large role in their hiring, as in most startups, which further introduces bias and makes the culture exclusionary…Founders are looking for ‘objective’ measures, such as school ranking, GPAs, SAT scores, but fail to recognize that these are biased. Dropbox and other startups should pioneer new ways to identify people who can succeed on the core set of job responsibilities. Perhaps a question on how Dropbox might be used to solve income inequality or the unaffordability of housing in San Francisco would reveal as much about someone’s creativity—and more about their character—than questions about superheroes.”
I sent this article to Drew Houston and again asked for a meeting. Drew and his diversity team came to meet me and my colleague Daniel Sicialano at Stanford Law School on March 5, 2014. Drew seemed to be genuinely concerned about the issues I had raised and briefed me on actions that his management team were taking to remedy the hiring situation and fix their gender imbalance. I have since heard from Dropbox employees that it is making good progress on this front.
Dropbox is proving that fixing the gender imbalance really isn’t hard once CEOs accept the situation and put a focus on it. Here are some things that companies—big and small—need to do:
Once Women Are Hired, the Challenge for Businesses Becomes How to Retain Them
A problem women commonly face when they join the industry is that of feeling marginalized and discriminated against. They leave the workforce midcareer. A report by the Anita Borg Institute noted that women leave technology companies at twice the rate at which men do. The key reasons are poor working conditions for women, lack of work-life balance, uninteresting work, and bad organizational climate.
Here is what needs to be done:
All of this needs to come from the top down. Corporate executives must take ownership for increasing technical women’s participation. If they don’t, it won’t happen. Managers must review data at every level of the pipeline with executive management. What you measure, you can control. Most importantly, as Sanders says, “this can’t be lip service and can’t be delegated to mid-management—and certainly not to the technical women themselves to solve. Make it clear why it’s not just a quota issue or an arbitrary mandate, but a critical innovation and business imperative.”
One more key point, one that Klein always asks me to stress: It is important to recognize the changing demographics in the United States. The current majority of school kids in many states comprise members of racial and ethnic minorities. Too often, a focus on ‘women’ has meant affluent, white women. We need to make sure that company culture and practices are welcoming to African-American women, Latinas, and Asian-American women. They are an important part of the future of innovation and of this country.
Fostering Entrepreneurship
To create the next Google, Facebook, and Intel, we need to boost entrepreneurship—particularly among women. It starts with making cultural changes to make risk-taking—and failure—more acceptable, teaching aspiring entrepreneurs the basics, providing them with seed funding and encouragement, and mentoring them to success. Networks play a very important role, as I know from personal experience as well as from my academic research.
Following the Indian trail
Thirty years ago, there were hardly any Silicon Valley firms with Indian-born founders. UC-Berkeley’s AnnaLee Saxenian documented that 7 percent of tech companies started in 1980 to 1998 had an Indian founder. A survey conducted by my research team at Duke University found that this proportion had increased to 13.4 percent from 1995 to 2005 and then to 15.5 percent in 2012. These are pretty astonishing numbers considering that according to the U.S. census, in 2000, less than 0.7 percent of the U.S. population and only 6 percent of the Silicon Valley high-tech workforce was born in India.
Indian immigrants didn’t have it easy. They suffered from the same types of stereotypes as women, African-Americans, and Hispanics. Despite having cofounded a software company that we took from startup to $120 million in revenue, profitability, and IPO in a record five years, I couldn’t get Research Triangle Park (RTP) VCs to even return my phone calls when I was ready to start my second venture. I later found out why: “my people” were great at mathematics and made great engineers, but didn’t make great CEOs—“we” didn’t have the necessary management skills, didn’t like diluting our equity ownership by raising venture capital, and couldn’t “fit” into the rough-and-tough American business-management culture. That’s what one RTP VC told me over lunch, to explain why his firm wasn’t inviting me to pitch my business plan. They were very busy and had to be selective in who they met. Sounds familiar, doesn’t it? My “people” didn’t fit the pattern that VCs knew would lead to success.
So how did “my people” rise above ignorance and bigotry? When the first generation of Indians in Silicon Valley succeeded in shattering the glass ceiling, they decided to help others follow their path. They realized that they had all surmounted the same obstacles. And they could reduce the barriers to entry for others behind them by sharing their experiences and opening some doors.
In 1992, a number of highly successful Indian business executives formed a group called The Indus Entrepreneurs (which is now called TiE). Their mission was to give back to the community by fostering entrepreneurship. They would hold monthly events, teach entrepreneurship, and provide mentoring and support. And they would facilitate Indian-style matchmaking between entrepreneurs themselves and with investors and corporate partners. They created two categories of members: a charter member, who took the role of Guru, and a regular member, who would be a disciple. The Guru had to donate time and money (minimum $1,500 per year) and was not allowed to gain any personal financial benefit. When disciples achieved success, they would be expected to pass it forward by becoming charter members and helping others behind them.
I was able to get advice and mentoring from a Who’s Who of Silicon Valley’s TiE group and build a successful business. It wasn’t long before the VCs were tripping over each other to offer me term sheets. But while male Indian entrepreneurs today are perceived to fit the patterns of success that VCs look for, women are still left out. (Though TiE set a goal of helping all communities, women are still underrepresented in its ranks.)
Women need to help one another, to have corporate leaders be personally involved in mentoring, proselytizing, and demonstrating by example a different model of investing in women and minority-group entrepreneurs. There is nothing more powerful within an organization than having its own CTO talk about the importance of, for example, promoting women. And we need to have VCs mentor the women and minorities they typically ignore. They need to do this not only for social good, but also for their own survival.
[1] Dan Primack, “Venture capital’s stunning lack of female decision-makers.” Fortune, February 6, 2014. http://fortune.com/2014/02/06/venture-capitals-stunning-lack-of-female-decision-makers/
[2] Brad Feld, “Things Woman Entrepreneurs Can Learn from Indian Entrepreneurs.” FeldThoughts, February 21st, 2010. http://www.feld.com/wp/archives/2010/02/things-women-entrepreneurs-can-learn-from-indian-entrepreneurs.html
[3] Vivek Wadhwa, “Dropbox’s hiring practices explain its disappointing lack of female employees.” The Washington Post, February 14, 2014. http://www.washingtonpost.com/blogs/innovations/wp/2014/02/14/dropboxs-hiring-practices-explain-its-disappointing-lack-of-female-employees/