Where are the women?

With this trial as a backdrop, I recently attended a panel called “Bridging the Gender Gap: Women in PE/VC” at Columbia Business School’s annual Private Equity & Venture Capital Conference. I was hoping to get some perspective on why more women aren’t joining venture capital firms or being promoted into the upper ranks at private equity firms.

Instead, executives on the panel spent a lot of time trying to paint a reality where women are judged on their work and not on their gender. That’s the way it should be, of course, but, according to the numbers, it’s not an accurate portrayal of real life. Women aren’t getting opportunities to be judged on their work. They’re barely making it into venture firms, and they rarely climb the ranks at private equity firms.

Look at the numbers: A study from Babson College published in September revealed the number of women partners at venture firms had dropped to 6 percent last year from 10 percent in 1999. The same study also showed women-led businesses have a much harder time getting venture funding.

Separately, Preqin released a study that said almost 15 percent of senior roles at venture firms were held by women this year, up from 11.2 percent in 2014, but that only 10.5 percent of senior posts at buyout firms are held by women.

Yet another study earlier this year by Coller Capital showed a majority of limited partners do not believe more senior-level women at private equity firms would result in better returns.

These findings don’t paint a very promising picture of the future of gender inclusion in the industry. When I wrote about this issue for our sister publication PE HUB, several professional women wrote in to highlight their own experiences in the field. In general, they reported on obstacles like men easily bonding, leaving female colleagues out of the “circle,” and talented female associates left in the wake of their more outspoken male colleagues. 

One veteran female industry professional wrote:

“Professions such as legal, audit, banking and management consulting have made significant strides in having a more diverse senior professional staff over the last 20 years. These jobs are sometimes even more demanding on one’s personal life than PE and yet there are many senior women in their ranks. These gains were not easy. Nearly all of these firms have had dedicated efforts to improving against these stated goals. They have gone out of their way to include women in the most lucrative career paths at their firms.

“On the business school side, when I attended HBS over 20 years ago there were 20 percent women graduating in our class. I would challenge you to find a single major (10 partners, billion dollars) fund whose investment partners are near 20 percent women. 

“From my seat it is abundantly clear that nothing will change until the firms make a stated goal with a specific plan to change it. It is my opinion the only impetus for such a plan would come from the investor side. It is also my opinion and I have seen a number of studies that show that having more diverse investment teams leads to better returns. It is good business for LPs to require the GPs with whom they invest to develop and implement a plan to fix this glaring issue. To be clear this is not to correct a societal wrong but to effectively exercise their fiduciary requirements to select firms who are most likely to achieve outstanding investment results.”

I was hoping to hear from the women on the panel about their own experiences overcoming lack of diversity through their careers, but it seemed as though the panelists were reluctant to delve too far into the issue. To be fair, it is a tough issue to talk about, but we need frank discussions about what is wrong and what to do about it.

This is even more important at events like the Columbia conference attended by young women graduate students to know what it’s going to take to break into the Old Boy’s Club and hopefully change things for the better.