When it Comes to Pay, Study Says L.A. is Worst Big City for Women in Tech
Ben Bergman
Ben Bergman is the newsroom's senior reporter, covering venture capital. Previously he was a senior business reporter and host at KPCC, a senior producer at Gimlet Media, a producer at NPR's Morning Edition, and produced two investigative documentaries for KCET. He has been a frequent on-air contributor to business coverage on NPR and Marketplace and has written for The New York Times and Columbia Journalism Review. Ben was a 2017-2018 Knight-Bagehot Fellow in Economic and Business Journalism at Columbia Business School. In his free time, he enjoys skiing, playing poker, and cheering on The Seattle Seahawks. Follow him on Twitter.
Los Angeles is the worst big city for women working in tech in the nation with females making only 82 cents for every dollar that their male counterparts pull in, according to a new report from the financial website SmartAsset that considers the gender pay gap, earnings after housing costs, women's representation in the tech workforce and four-year tech employment growth.
Eighty-two cents on the dollar is close to the national average. But, L.A.'s ranking was hurt most by the city's notoriously high housing costs. The report estimates women earn $44,517 after paying for a place to live, compared to $55,745 nationally.
"It upsets me that in a city that hypes itself as so progressive, it's not," said Carmen Palafox, a partner at MiLA Capital, which invests in pre-seed and seed technology ventures.
But, it comes back down to a venture and tech community that's male dominated, she said.
"I look at companies everyday. And I get decks that the whole team is male," she said. "I don't think this would happen if we had more women CEOs. That's supported by data. Women employ a more diverse workforce and I find it hard to believe that women-led companies would have such wide pay gaps."
The Bay Area has more expensive rental and home prices but also higher salaries, so San Francisco female tech workers make $74,401 after housing expenses, putting it at No. 33 on the list.
Women looking for a better place to work and live might consider Long Beach, where female tech workers actually earn more than men, the only city in the study where that happens. Long Beach also had one of the biggest percentage increases in tech workers in the nation, going from 4,500 workers in 2015 to 6,000 in 2018.
Despite widespread attention to the issue, the nationwide gender pay gap in tech is getting worse. In 2018, women earned 83.1 cents on the dollar compared to what men make, a 3.8 cent decrease from 2015. Women comprise about a quarter of the tech workforce nationally.
Baltimore and Washington D.C. ranked as the best place for women to work in tech, with a gender pay gap of 94 and 93 cents, respectively.
Rachel Uranga contributed to this report.
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When Christine Outram, founder and CEO of Everydae, a digital tutoring app, met with investors last year to try to raise a seed round she kept being told to come back in six months.
"I guess you can say we were turned down," she said.
Outram decided to try a different route, turning to equity crowdfunding, which allows mom and pop investors to dabble in something that until recently was solely the domain of professional investors. Her campaign proved successful – she raised $1.2 million from 1,586 people who wrote checks between $250 and $50,000.
<p>"I've been really pleasantly surprised by the whole process," said Outram.</p><p>For reasons no one can quite explain, equity crowdfunding is having its moment during the coronavirus pandemic. <a href="https://wefunder.com/" target="_blank">Wefunder</a>, the largest funding portal, recently had its best three months in the company's four-year history, with investor volume up 35% February through April. In early May, the site recorded $2 million of investment in a single day, a new record.</p><p class="shortcode-media shortcode-media-rebelmouse-image">
<a href="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMzM3MDU3MC9vcmlnaW4ucG5nIiwiZXhwaXJlc19hdCI6MTYxNDExMzE0NH0.rZ9oMElxMJoOk4Q6O2rtO5WRkBv-jwPr0hovYqNxsQM/img.png?width=980" target="_blank"><img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMzM3MDU3MC9vcmlnaW4ucG5nIiwiZXhwaXJlc19hdCI6MTYxNDExMzE0NH0.rZ9oMElxMJoOk4Q6O2rtO5WRkBv-jwPr0hovYqNxsQM/img.png?width=980" id="64d5e" class="rm-shortcode" data-rm-shortcode-id="dd4daf93b57f2b7b1eb5c9a49164a785" data-rm-shortcode-name="rebelmouse-image" /></a>
<small class="image-media media-caption" placeholder="Add Photo Caption...">Wefunder had its best three months in the company's four-year history, with investor volume up 35%.</small>
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</p><p>"I have been so confused," said Nick Tommarello, co-founder and CEO of Wefunder. "I don't know the answer. The big question for us was always how we would respond to a recession. You would assume that people would not want to invest."<br/></p><p>Tommarello theorizes that more startups are turning to platforms like his as other sources of capital dry up, attracting casual investors who don't mind parting with what usually amounts to no more than the cost of an expensive meal to take a lark on a company. The median investment is $200 and 80% are less than $500.</p><p>"Our users aren't rich but they're middle class," said Tommarello. "People are not allocating it as an investment, but as discretionary income. They say they can go out for dinner or back someone and support them." </p><p>Brian Citizen, who lives outside Washington D.C., has invested in about a dozen startups through Wefunder usually at $250 a piece, including Everydae. </p><p>"It's become a passion of mine and something I really believe in and it's also fun because I get to help out entrepreneurs and be a part of the building process," said Citizen, who adds that COVID-19 has made him more excited to invest. "I think there's an opportunity to get better deals. The terms are going to be better for investors."</p><p>There is an oft repeated statistic that <a href="http://innovationfootprints.com/wp-content/uploads/2015/07/startup-genome-report-extra-on-premature-scaling.pdf" target="_blank">90% of startups fail</a>. Even professional VCs who have been at it for decades expect most of their portfolio to be a bust, so experts are wary about casual investors trying their luck in such a risky asset class.</p><p>"Some analysts even project that equity crowdfunding could surpass VC investments in the not-too-distant future," <a href="https://review.chicagobooth.edu/experts/waverly-deutsch" target="_blank">Waverly Deutsch</a>, clinical professor of entrepreneurship at The University of Chicago Booth School of Business, wrote <a href="https://review.chicagobooth.edu/entrepreneurship/2018/article/equity-crowdfunding-inflating-bubble" target="_blank">in a post warning investors.</a> "This may be exciting news for entrepreneurs, and perhaps for people eager to help start-up founders that they know—but will likely lead to a start-up bubble and massive losses for the majority of individual investors."</p><p>Citizen says he is well aware of the risks and limits his total crowdfunding investments to about $2,000 a year. "I'm only willing to invest what I'm willing to lose," he said. "But the returns have the opportunity to be great."</p><p>Wefunder is upfront with users about the risks and avoids any impression that users will strike it rich, according to Tommarello.</p><p>"Our marketing is very blunt that you might lose all your money and most startups will fail," he said. "We say that over and over again. We don't even talk about our investment returns."</p><p class="shortcode-media shortcode-media-rebelmouse-image">
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</p><p>Instead of returns, the site tries to appeal to a blend of users' patriotism and altruism with a hopeful message on the homepage: "Keep the American Dream alive. Back founders solving the problems you care about and help their startups grow."</p><p>Equity crowdfunding was made possible by the SEC allowing anyone to invest in private companies in 2016, a privilege previously only accorded to "accredited investors" who made more than $200,000 per year or had investable assets of $1 million or more. A further loosening of the rules went into effect this year, which Tommarello says is likely contributing to the platform's popularity. </p><p>"A lot of the downsides have been taken away," he said. "The biggest crowdfunders previously needed to have thousands of direct shareholders on their cap table."</p><p>The SEC announced in May it would temporarily make it easier for companies affected by COVID to qualify. "In the current environment, many established small businesses are facing challenges accessing urgently needed capital in a timely and cost-effective manner," SEC Chairman Jay Clayton said <a href="https://www.sec.gov/news/press-release/2020-101" target="_blank">in a statement</a>.</p><p>Wefunder has backed 382 startups with $135 million, an amount smaller than many individual venture capital funds. Crowdfunding is still a niche, but it is gaining more widespread acceptance. </p><p>"I do think VCs are opening up to it more," said Kevin Morris, Chief Financial Officer at <a href="https://www.wavemakerlabs.com/" target="_blank">Wavemaker Labs</a>, an early stage firm with offices in Santa Monica and Singapore. "Crowdfunding has been a bit of a bright spot in this economy so I think it would only help them."</p>
<img lazy-loadable="true" src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMzM3MDU4Ni9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTYxMzI1NjkxNn0.O81zjgFBXSVpmpsW2-07MkIMtQzVh17-hUqUtIJCTnQ/img.jpg?width=980" id="754c2" class="rm-shortcode" data-rm-shortcode-id="8516f184baf109870a44b7f697ae1caa" data-rm-shortcode-name="rebelmouse-image" />
Christine Outram, founder and CEO of Everydae, a digital tutoring platform.
<p>Wavemaker invests in the pre-seed and seed rounds of companies and then raises follow-up capital via equity crowdfunding, a strategy that has worked well with Miso Robotics, a robotic kitchen assistant and Graze, which makes a roomba-type device that mows lawns.</p><p>"Both of these businesses were always well suited for crowdfunding but what we've seen in COVID is businesses in the automation space are doing even better," said Morris. "With crowdfunding in general you can get slightly higher valuations than you would from a VC and in a business that is consumer facing you're not only getting capital but you're building brand ambassadors."</p><p>Marketing her virtual tutoring app has been one of the most appealing parts of equity crowdfunding for Everydae's Outram, but she says attracting investors took considerable effort. Most campaigns, including hers, see a spike at the beginning but trail off after the initial excitement.</p><p>"My job was to always have new news to draw eyeballs to the page," she said.</p>
<p><span style="background-color: initial;">Outram posted a steady stream of content to her </span><a href="https://wefunder.com/everydae" style="background-color: initial;" target="_blank">Wefunder page</a><span style="background-color: initial;"> and appealed directly to podcasts and groups centered around education and investing. She also bought ads on Instagram and Facebook, which proved to be worthwhile when a Facebook ad led to a $150,000 commitment.</span><br/></p><p>"What a lot of founders don't realize Is that equity crowdfunding is as much work as other kinds of fundraising," she said. </p>From Your Site Articles
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Warehouse Workers Sue Amazon Over COVID-19 Exposure After Death of an Employee’s Relative
Jun 04 2020
Barbara Chandler believes she contracted COVID-19 in March at her job, working in an Amazon warehouse in New York where she experienced "a culture of workplace fear reinforced by constant technological supervision, retaliation against those who speak out, and the threat of automatic and immediate job loss in a job market where it may be impossible to find work elsewhere," according to a lawsuit filed in federal court in New York this week.
Less than a month after contracting the virus, Chandler says she woke up to find her cousin, whom she lived with, dead after experiencing COVID-19 symptoms.
<p>Chandler and several other Amazon warehouse employees and their relatives are now suing the company for failing to implement adequate safety measures to protect workers and their families from COVID-19. Other than quarantine pay that Chandler says Amazon failed to provide, the lawsuit does not seek damages for past harm. "All they seek is an order requiring Amazon to comply with public health guidance to prevent more harm in the future," according to the complaint.</p><p>The lawsuit stands out from other legal challenges over Amazon's response to the coronavirus pandemic because it accuses the company of culpability in the death of a warehouse employee's relative.</p><p>Bloomberg News <a href="https://www.bloomberg.com/news/articles/2020-06-03/amazon-warehouse-employees-sue-over-virus-brought-home-from-work?sref=CUpXQy6u" target="_blank">first reported on the lawsuit</a>.</p><p>There have been at least 44 cases of COVID-19 and one death from the virus at the warehouse where the plaintiffs work, JFK8, according to the complaint. Amazon has repeatedly declined to disclose data on the number of infections across its workforce.</p><p>JFK8 has long been a hotspot for employee activism, a trend that has accelerated during the pandemic. Employees at the facility have organized walkouts and publicly called for broader safety protections. Amazon fired the organizer of one of the first walkouts, Chris Smalls, claiming he violated a company-imposed quarantine. A <a href="https://www.geekwire.com/2020/amazon-responds-leaked-memo-reveals-companys-pr-strategy-warehouse-worker/" target="_blank">leaked memo</a> in which an Amazon executive described a PR strategy targeting Smalls later cast doubt on the reasons for his termination.</p><p>Amazon has emerged as a lifeline for customers sheltering at home during the pandemic but keeping operations running during the crisis comes at a cost. Warehouse workers are tracking hundreds of COVID-19 cases across Amazon facilities and activists, politicians, and employees are speaking out about the company's response to the pandemic.</p><p>Amazon implemented hazard pay and expanded its sick policies while adding 175,000 new warehouse and delivery workers to cope with surging demand. The company says it has updated 150 processes to protect worker safety and is spending more than $800 million in the first half of this year on new safety programs. The changes include employee temperature screening at all facilities and providing personal protective equipment according to Amazon.</p><p>"We are saddened by the tragic impact COVID-19 has had on communities across the globe, including on some Amazon team members and their family and friends," said Amazon spokesperson Lisa Levandowski in a statement. "From early March to May 1, we offered our employees unlimited time away from work, and since May 1 we have offered leave for those most vulnerable or who need to care for children or family members."</p><p>The plaintiffs accuse Amazon of creating "a façade of compliance" with safety standards while relying on "purposeful miscommunication with workers, sloppy contact tracing, and the culture of workplace fear it has instilled at JFK8 to ensure it can maintain productivity while reducing costs."</p><p>The result, according to the lawsuit, is workers who "come to work sick and cannot engage in proper hygiene, sanitizing, or social distancing while at work in order to stay healthy."</p><p><a href="https://www.geekwire.com/2020/warehouse-workers-sue-amazon-covid-19-exposure-death-employees-relative/" target="_blank">This story first appeared on GeekWire.</a></p>
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At a virtual town hall held Thursday by dot.LA and PledgeLA to identify actions leaders in the L.A. tech and startup community can take now to break down racial barriers to jobs and capital, and to democratize economic opportunity for the region -- there were ultimately a robust number of questions asked and interest expressed around the issue, though tangible actions remain to be seen.
Nearly 30 years after the 1992 riots in Los Angeles, protesters across the U.S. gathered this time to march against systemic racism and violence faced by the black community after George Floyd was killed while in police custody in Minneapolis.
Across social media, tech companies in L.A. and beyond have posted and tweeted their support for #blacklivesmatter, muted their feeds, and opened their pocketbooks, while music companies took part in a blackout. Companies have also donated to various diversity, equity and inclusion causes, but it remains an open question as to what impact those efforts will have.
<p>"I'm very happy to see that the conversation has shifted, so quickly. I mean, I say that, and kind of almost have to laugh to myself, because this is the conversation that black folks have wanted to have for the last several decades," said Austin Clements, partner at OPV, an early stage venture capital firm created to address the unmet investment needs of small business owners, and managing director of Grid 110 South LA, which provides entrepreneurs with free access to community, mentors and critical resources.</p><p>"Now that people are paying attention, I have two options, I can either be shaming people for like, 'Why are you late to this party?' or I can be welcoming and say 'hey, you know, thanks for showing up.' And I tend to take the latter because that's going to be what makes the next decade, look a lot different than the last."</p><p>Unlike the response to COVID-19 pandemic, where the tech community rushed to directly help and support the effort for PPE, testing and other needs, the response to the protests have been a little more subdued and mixed.</p><p>Some tech companies and leaders have asked how they can help, but for many people, "they don't necessarily see the connection (to) their professional career, their professional skill sets, and how it can address the current issue," said Jasson Crockett, manager of economic policy for the Los Angeles Mayor's Office of Economic Development.</p><p>"I would encourage tech (workers) not to feel uncomfortable wading into this space simply because they are tech and they don't see a direct resolution from their professional skill set. Bring your humanity. Bring your commonality as an Angeleno and as a person."</p><p>In an annual countywide survey released in April, <a href="https://luskin.ucla.edu/opinions-about-quality-of-life-in-l-a-vary-sharply-across-generations" target="_blank">the Luskin School of Public Affairs at the University of California, Los Angeles found "a growing generational and economic divide" among residents</a>. Nearly ⅔, or 64%, of respondents between the ages of 18 and 39 said that L.A. wasn't a place where people who work hard can succeed, but merely a place where the rich can keep getting richer. That's not even accounting for the racial aspects of widening income inequality issues. </p><p>Clements said in recent years, despite increased conversation around diversity and inclusion in Silicon Valley, "there are a lot of minorities, particularly brown and black people that have been left out, and no one could really understand why. Or, there have been all kinds of excuses from, you know, there's a pipeline problem to, you know, all the culture fit and every excuse that you could possibly come up with." He added: "I haven't been seeing a lot of broadly accepted diversity efforts in tech."</p><p>As the chair of PledgeLA, an initiative created by the Annenberg Foundation and the mayor of Los Angeles to promote civic engagement and diversity within the tech community, Clements has been trying to help broaden that effort. Today, <a href="https://www.pledgela.org/" target="_blank">PledgeLA has more than 200 signatories from L.A.'s venture capital and tech community</a> who have pledged to "increase our community engagement by supporting organizations that are making a difference throughout Los Angeles"; "to actively and continuously improve equity, diversity, and inclusion at all levels of our organizations and in our investment decisions"; and "to hold ourselves accountable by measuring and transparently reporting on our progress and impact on these outcomes."</p><p>It is on that last point that many companies have been less willing to engage. The results for the survey and data from the participating companies who did respond are expected to be released soon, Clements said.</p><p>But, as an example of their findings, one of the questions asked to respondents was about how people got their jobs. For the overwhelming percentage of white respondents to the survey, they got their jobs through a friend or referral from someone that worked at the company itself. That was not the case for every other group, Clements said. </p><p>"If you're not tied into this community and these aren't your firsthand relationships, it's hard to actually break into this (tech and VC community)," Clements said. "If you're black, you're literally replying to a LinkedIn post cold and you're at a disadvantage, quite frankly."</p><p>Clements added: "If we just keep asking everybody that's sitting in the room who else they know in the room isn't going to look any different over time."</p><p>That seems to be evident in past actions by the tech community. Roughly five or six years ago, some of the larger tech companies began publicly admitting that their employees were less representative of the overall population, especially at the executive level, Clements said.</p><p>"Unfortunately, they either just have not been equipped or just haven't tried or made it a priority to make any meaningful or substantive advances to improve those numbers," Clements said. "And the reality is, they've gotten away with it. I mean, if we look into stock prices of all these companies, like they've shot up and so I guess theoretically, they haven't had to from a business case standpoint prioritize that. I think that there's the moral case and a business case at this point for ensuring that your staff and your community is more representative of the actual populations of the city."</p><p>The numbers have been clear, <a href="https://hbr.org/2018/07/the-other-diversity-dividend" target="_blank">in study</a> <a href="https://www.mckinsey.com/~/media/McKinsey/Business%20Functions/Organization/Our%20Insights/Why%20diversity%20matters/Why%20diversity%20matters.ashx" target="_blank">after study</a>, that diverse companies and funds reap dividends from the diverse perspectives and insights brought to the table. Take just one conclusion, from McKinsey & Company, "Our latest research finds that companies in the top quartile for gender or racial and ethnic diversity are more likely to have financial returns above their national industry medians."</p><p>But recruiting people outside of your network takes work. With the shakeup of the economy due to the novel coronavirus, there's a real danger that companies especially in the startup community abandon any existing diversity efforts because of a tightened bottom line, said Emily Slade, cofounder and COO of Valence, a new tech platform and community incubated by Upfront Ventures that's focused on connecting black professionals with mentorship, job opportunities and capital.</p><p>"We just have to really encourage everybody to stay focused on the fact that this work is very important," Slade said, "and we've just begun."</p><p>Valence currently works with hundreds of companies and has more than 7,000 black professionals on it.</p><p>The American ideal of a meritocracy has long been a vaunted ethic in the tech and business world. Those communities and their leaders have evangelized the idea that with hard work anyone can pull themselves up the ladder of wealth and influence by their bootstraps. But the panelists did not agree.</p><p>"We live in a world in which your talent, your skill and your ability and potential come secondary at best, probably tertiary to who you know," Crockett said. "And when you start with that as the baseline, then by no way is this a meritocracy, not even close."</p><p>As a former teacher for at-risk young adults, Crockett said it seems as if "we continually feed this message of meritocracy to keep people going, because if not, fi we all in one voice admit we don't have a meritocracy right now and there's no plan for how we're going to change it, we're just admitting it, that's a scary reality for a lot of people who are on the fringes of society, who say, 'shit, why am I trying.'"</p><p>All of us should be asking what we're doing to acknowledge and support and foster the efforts of everyone, and requires first taking the step of admitting that there is no meritocracy right now, Crockett added.</p><p>The speakers weighed in on many more issues and also addressed some of the many audience questions received by dot.LA, including around the topic of recruitment and a perceived "pipeline problem." dot.LA also plans to post additional responses by panelists to questions asked during Thursday's panel. In the meantime, please watch the video below for insights directly from these speakers. </p><p>Lastly, a takeaway thought from Crockett: </p><p>
"What is important is that we capture (this) momentum, unlike in the past, when there has been a moment in time that these conversations have reached a fever pitch but then the energy dissipated," Crockett said. "It is tough to sustain that energy for a topic that makes so many people feel so incredibly uncomfortable, and for which there are so many such a wide range of opinions and perspectives. And so my hope is that the tech community can be an important part in sustaining this conversation beyond the protests beyond next week (because) when you talk, my boss listens."<br/></p><p>__</p><p><em>Do you have a story that needs to be told? My DMs are open on Twitter </em><a href="https://twitter.com/latams" target="_blank"><em>@latams</em></a><em>. You can also email me at <a href="mailto:mailto:tami@dot.la" target="_self">tami(at)dot.la</a>, or ask for my contact on Signal, for more secure and private communications.</em></p><p class="shortcode-media shortcode-media-youtube">
<span style="display:block;position:relative;padding-top:56.25%;" class="rm-shortcode" data-rm-shortcode-id="06e31f21c620c46e30195a4011f99a80"><iframe type="lazy-iframe" data-runner-src="https://www.youtube.com/embed/xpHW_gtxyH0?rel=0" width="100%" height="auto" frameborder="0" scrolling="no" style="position:absolute;top:0;left:0;width:100%;height:100%;"></iframe></span>
<small class="image-media media-caption" placeholder="Add Photo Caption...">Strategy Session: Lessons of the Moment – Rebuilding & Equality in the Future of LA Tech</small>
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<a href="https://www.youtube.com/watch?v=xpHW_gtxyH0&feature=youtu.be" target="_blank">www.youtube.com</a>
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