One woman reported being locked in a conference room while a coworker masturbated between her and the exit. Another 50-year-old female tech professional, with a PhD in engineering, said her entire professional life has been "filled with harassment, sexual or otherwise." Then there was the founder who was invited to join an investor in a hot tub to help close a deal.
It seems that the era of #MeToo hasn't significantly changed things for women in tech, according to a new report released Tuesday by Women Who Tech, a nonprofit founded to draw attention to gender bias in VC funding and support women in tech.
Courtesy of Women Who Tech
Nearly 50% of female founders and workers in technology have experienced harassment, roughly the same three years later. When female employees reported harassment to human resources, 85% said their harasser faced zero repercussions at work.
For female employees, harassing behaviors ranged from offensive "jokes" (75%) to unwanted physical contact (54%) to sexual slurs directed at them (51%) to being propositioned for sex (35%). Eighteen percent of female employees said they were propositioned for sex in exchange for a promotion, an increase of 5% from 2017.
Among the surveyed female founders, 65% reported being propositioned for sex (up 9% from 2017), 59% reported unwanted physical contact (down 3%), 32% were groped (up 7%), and 24% sent graphic photos (up 14%).
The report was the result of 1,003 interviews conducted by Lincoln Park Strategies over more than a month via an online survey.
Tech founders who are women of color reported being harassed 46% of the time by a potential investor, while 38% of white women founders had the same experience.
"We were invited to an opulent private club (with hot tubs, which the investor kept inviting one of our female founders to use with him after we finished — implying we could close sooner if she'd agree to go)," a female founder anonymously reported during the survey.
Courtesy of Women Who Tech
Craig Newmark, founder of Craigslist and Craig Newmark Philanthropies and a member of Women Who Tech's advisory board, called the data "disturbing" and added that "we need less ally theater and more people in positions of power to recognize that power, not abuse it, and support women in tech."
A smaller percentage of women said they trust their companies to handle harassment allegations over time in 2020 compared to 2017.
Women who didn't report the harassment said they were scared to lose their job, or had "seen what happens when people do report and I don't want my life made harder." Another woman said she was embarrassed and worried it would impact her job with her supervisor and coworkers.
The report also dealt with the ability to raise money, with nearly 50% of female founders saying they would raise more money if they were a man.
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The nationwide protests in response to the killing of George Floyd led to a flurry of discussions and self-reflection in the overwhelming white male world of venture capital about what needs to change to make the industry more diverse. While many VCs were quick (or not so quick) to take to social media to say they support diversity or attend webinars on inclusivity, meaningful concrete action has been less common.
"The venture field has been probably the slowest to let minorities and women in," said Sue Toigo, co-founder of the Toigo Foundation, which helps underrepresented minorities get careers in finance. "It has the worst record of all asset classes."
Just 4% of VC employees are black, according to a 2018 survey by the National Venture Capital Association, an industry trade group, which announced a new nonprofit arm this week focused on diversity. However, the true numbers are likely much lower because that survey – like all others examining diversity — is self-reported. Only 203 of the 1428 VC firms NVCA contacted even bothered to answer. A local initiative to increase diversity, PledgeLA, has also been hampered by limited participation.
Along with Softbank, Andreessen Horowitz has been the only major firm to announce a new fund in the wake of the protests that will focus on underrepresented founders. But its new Talent x Opportunity Fund will start with just $2.2 million in donations from partners, a relative pittance for a firm with $14 billion under management.
"I'm worried that this is being treated as more of a charity case rather than doing the work to reform our internal process so that we don't discriminate against founders of color," said a black VC who works in L.A. She asked to remain anonymous because she was afraid speaking out could harm her future career prospects. Asked why she was afraid of using her name even after so many in the industry have spoken up in support of diversity, she said, "There are professional ramifications that may come with being known as the investor who only invests in founders of color. When you speak about diversity you're the diversity person and you're taken out of deals that don't have diverse founders, which is sad."
This VC said she was happy to finally see more people "waking up" to biases in the industry and that most have good intentions but she wonders if partners are willing to do the harder things necessary to truly change how investment decisions get made. "Companies need to tie their executive compensation to these efforts if they're serious about it," she said.
Luma Launch, the four-year-old investment arm of the film studio Luma Pictures, is a typical VC firm. Its three investors are all white and out of the 28 companies in its portfolio, none were founded by a black person.
"The reality is we are the problem," said Luma's lead investor, Laurent Grill. "We've obviously all contributed to this in some form or fashion whether it was passively or actively."
In 2017, as the country was roiled by the Me Too movement, Grill and his partners revamped their deal flow to ensure more female founders get funding. He says the percentage of female founders the firm sees increased from 10% to 30% and now he is determined to hold the firm accountable to invest in more people of color.
"This is not being charitable," Grill said. "We are not trying to just invest in companies to check a box, that's when things will crumble and fail. I don't have the perfect solution. We are genuinely having conversations about this."
The effort to add more female VCs after #MeToo can provide a helpful template for increasing diversity, according to Paul A. Gompers, a professor at Harvard Business School who studies the demographics of finance. He found that after 25 years of virtually no gains, over the past four years the number of female VCs hired nearly doubled, though it is still just 18%.
"We have these strong biases to associate with people who are like us," Gompers said. "I think most venture capitalists aren't sexist and they're not racist but these unconscious biases affect our decisions."
Gompers has found VCs who have daughters tend to hire more female partners and their portfolio performs better. He's now turning his attention to ethnic diversity, gathering data to see if VCs who played on diverse intercollegiate athletic teams are more likely to hire people who do not look like them.
"Who you invest in looks a lot like who you are, so white men who went to Stanford and worked at Google like to invest in white men that went to Stanford and worked at Google," he said. "We know there are underserved pockets of entrepreneurs out there and those opportunities could perhaps create greater returns."
Internships are a crucial pipeline for recruiting new talent, but Toigo says VC firms can often be reluctant to bring them on, blaming fears about exposing proprietary deals to someone who might only stick around for a summer. "We have a hard time placing our interns at firms," said Toigo.
If nonwhite people do somehow make it in, they rarely advance, especially to the highest levels from principal to partners, who are usually brought in from the outside from those who can raise capital themselves or have operated their own company.
"When you don't have representation on your investment committee, it is very hard to properly assess people that come from backgrounds very different from yours," said Austin Clements, a partner at early stage venture firm OPV and the managing director at Grid110.
Just 10% of VC-backed companies in Los Angeles are run by a person of color or a woman, according to PledgeLA.
If one was trying to create a deal- making process from scratch to perpetuate whiteness, you would be hard pressed to come up with one more exclusionary than the current one where pre existing networks and who you know are paramount. Many firms require "warm introductions" before they will even consider evaluating a company.
"The same VCs who complain about 'not getting deal flow' from diverse- or females-led companies are the same people who have the 'we prefer a warm intro' line on their website," tweeted Samantha Smith, founder & CEO of Vishion.
Clements said he sees it all the time. "When people come and speak to South L.A. or predominantly minority communities, the common thing to say is 'to get in touch with me through a warm introduction'," he said. But many in the room think "'how can you possibly look at me and think we have any mutual friends in common.' I don't know that (investors) really have accepted that. People think if you have enough hustle you can get in touch."
Making matters more difficult, investors typically don't want to put money into startups that other VCs have not already invested in. And in the absence of the sort of financial metrics that would usually be the most important criteria for more mature companies, VCs have to weigh something far more subjective: Whether they trust a founder.
"The question is what makes people trust people?," said the VC who wished to remain anonymous. "Is it how educated they are? Is it how many friends they have in common? Their similarities? People tend to trust people that are more like them. It's easy to see how certain demographics are cut out of the very beginning of deal evaluation."
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AllVoices, an anti-harassment app inspired by the #MeToo movement, has raised $4.1 million, according to Securities and Exchange Commission filings posted last month.
Begun by former film studio executive Claire Schmidt less than two months after the Harvey Weinstein story roiled Hollywood and forever changed the conversation around sexual harassment in corporate offices, the app allows users to anonymously report information to a company's top leadership.
The seed round led by early-stage investors, Crosscut Ventures, brings the total raised by the company to $6.13 million, according to Pitchbook.
GoPro and Instacart are signed up for the app.
Schmidt, a survivor of sexual assault and former vice president at 20th Century Fox, started the company because she was moved by the stories of women coming to the forefront in recent years.
The platform takes in reports of harassment and funnels it over to a company's human resources division or top executives. Then those individuals can have an online, anonymous chat with the person filing the complaint.
AllVoices pitches itself as a way to provide companies with more transparency and understanding about what's happening with their employees.
The application also offers a dashboard function that provides an analysis of problem areas. For those whose companies aren't signed up, AllVoices asks for an email address of the individual at a company that should be alerted about the harassment.
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