By Donna Goodison | Tuesday, November 22, 2011 | http://www.bostonherald.com | Business & Markets
Photo by Chitose Suzuki
Women have been breaking through the glass ceiling in many industries, but there’s apparently a glass front door in the venture capital world.
Females accounted for just 11 percent of VC investors in a census survey released yesterday by the National Venture Capital Association and Dow Jones VentureSource. The majority of respondents were white males.
“It is a bit of a clubby industry, and I don’t think that anyone would dispute that,” said Maria Cirino, co-founder and managing director of .406 Ventures, a Boston VC firm. “You could certainly point to other industries where more strides have been made from a diversity standpoint, but I don’t think this would be on the list.”
The industry appeared to be making progress incorporating women into its workforce when VC firms were expanding rapidly from 1999 to 2001, but the post-2008 financial meltdown has left a much smaller amount of available capital, according to Cirino. “That’s putting a lot of pressure on diversity initiatives if they existed initially,” she said.
On the bright side, Cirino noted, many limited partners — who control pools of money that are invested in VC firms — have created specific mandates in the last decade for some of that capital to be put behind female venture investors.
“It’s a very intuitive business, and women are very intuitive by nature,” Cirino said.
Michael Greeley, general partner at Boston’s Flybridge Capital Partners, sees the dearth of women as “one of the great tragedies of the industry.”
“It doesn’t reflect our customer base,” he said. “I’m sure it will change because so many entrepreneurial success stories are not white men: they’re Indian, they’re blacks, they’re women, they’re minorities.”
A typical career progression is moving from being a successful entrepreneur to a venture capitalist, but a generational shift is needed to put a diverse face on an industry without much turnover, Greeley said.
“A lot of the old guard needs to retire,” he said.
Venture capital is an apprenticeship business to some extent, requiring leaders to step up and mentor more women, said Laura Sachar, founder of New York’s StarVest Venture Partners in New York, the largest U.S. women-owned venture fund.
“One thing we’ve done is successfully hired associates that are women to develop in the field, and I think it takes people making that kind of effort,” Sachar said.