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WOMEN HELP STARTSUP SUCCEED. WHEN WILL VCs NOTICE?

Aruba, October 11, 2012 - Successful startups have more women in senior positions than unsuccessful ones, according to a new analysis by Dow Jones (NWSA) VentureSource of more than 20,000 venture-backed companies in the U.S. between 1997 and 2011. They had more than twice as many women in top jobs like C-level managers, vice presidents, and board members than their unsuccessful counterparts did.

Companies that went public, were acquired, or turned profitable were defined as “successful.” “Unsuccessful” included both failed companies and “not-yet-successful” startups still operating that may eventually go public or get acquired. At successful companies, the median share of female executives was 7.1 percent, compared with 3.1 percent at unsuccessful firms.

There’s a distressing finding buried in the report: Even as companies with women in other top management roles performed better, those with female chief executives were less likely to succeed—by 21 percent, according to Maryam Haque, one of the researchers behind the report. It’s important to note the data don’t indicate why these companies succeed at different rates. The study doesn’t tell us whether women CEOs are less effective leaders, for example, or if they face biases from customers or investors that influence their companies’ performance, or if women are more likely to start companies in industries with higher failure rates.

What’s astonishing, though, is just how few women hold top positions in venture-backed companies, even by the lopsided standards of the rest of the business world. Consider: Women own 28 percent of all businesses in the U.S. Women make up about 16 percent of board members and corporate officers of the Fortune 500. That’s still a lousy record considering women are 51 percent of the U.S. population and better educated than men. But even that 16 percent puts the Fortune 500 way ahead of the VC-backed universe: Of the roughly 168,000 executives at companies in VentureSource’s analysis, less than 7 percent were women.

Read more/ Source: http://www.businessweek.com/articles/2012-10-05/women-help-startups-succeed-dot-when-will-vcs-notice#r=nav-f-story

 

 

By orbitalnets.com