Study discovers hidden gender inequities in Seattle startup scene

04/13/2017 09:59 pm ET Updated Apr 14, 2017

Uber was a start up just a few years ago. In 2009, two men, Travis Kalanick and Garrett Camp, founded what would soon become one of the largest taxi services in the world. In recent weeks, they’ve faced a flood of users deleting their app due to evidence of rampant sexual harassment within the organization.

Can you imagine what would have been different had Uber, from the beginning, prioritized building an inclusive and equitable culture? What if they had used practices to ensure that both women and men were promoted fairly and shared key decision making? If they had created and enforced stronger HR policies against harassment? If they had used any resources from the National Center for Women in Technology?

It’s a fair guess that Uber could have avoided the distress to their employees and their financial losses had they invested in good gender equity practices from the start. They might even have a better product.

Though all is not lost for Uber if they make serious changes to their company, it’s much easier for companies to build in good practices when they’re small, before they grow.

Three researchers in Seattle recently led a study to find out more about the state of gender equity in their local startup industry. Though not quite as many companies are founded in Seattle as in San Francisco, where Uber is based, it’s still one of the largest startup environments in the country. Their findings can be useful for most startup communities around the world looking for solutions to increasing diversity in their communities.

About the study:

Quite a bit of progress has been made recently in understanding how to improve gender equity in businesses. However, much of that research has been based on large, established companies. As anyone who’s worked with a startup knows, they function very differently. Startups move quickly, grow quickly, and iterate rapidly. They’re funded and led differently. They approach risk differently. So, much of the existing gender equity research doesn’t always translate well.

But startups also offer an incredible opportunity. As the adage goes “an ounce of prevention is worth a pound of cure.” If we can build good practices and cultivate inclusive cultures into businesses from the beginning, when they’re small and young, the potential for positive impact as they grow is enormous. This is so much easier than trying to fix it later. Just ask Uber.

In order to know how to improve, it’s important to know where we’re at today. Overall, very little data has been collected on gender and startups, particularly at local levels.

In Seattle, a volunteer research team conducted the first study of its kind to help fill that information gap, led by Martha Burwell, an independent gender equity consultant and writer.

“Seattle has one of the largest startup industries in the country. As a city, it also has the worst gender pay gap nationwide, due in part to the booming (and well-paid) tech industry, where only one in five jobs are held by women. Of VC-backed startups in Seattle, only 17% had even a single woman on the founding team. Clearly, there’s work to be done. But when I began to experiment with applying gender equity techniques to startups last year, I noticed that almost no data existed on gender in Seattle startups. Working to create social change without data is a lot like climbing a mountain in the dark. It’s possible, but much, much harder. So I reached out to Ruchika Tulshyan, a journalist and author, and Artemis Connection, a strategy consulting firm, to help fill that information gap.”

“We’re a relatively introverted city, and people aren’t always very comfortable talking about things like race and gender inequities. But we know that they are big issues that we need to work on. So we created an anonymous survey to help respondents feel safe sharing their experiences. Over 300 employees and founders in Seattle startups took the survey in December 2016, and the results are up at www.CatalyzeSeattle.org

Most fascinating findings

1. Startups with more than 50% female founders attract parents, women, and people of color

Women are nearly ten times more likely than men to work for a Seattle startup with a founding team that’s more than 50% women (27% of female respondents compared to 3% of male respondents). Interestingly, this same correlation didn’t show up for startups that had 10-50% female founders. In fact, women were actually less likely than men to work at those startups.

A similar pattern emerged along racial lines. People of color were nearly twice as likely as white respondents to work for a startup with more than 50% female founders, yet less likely to work at startups with 10-50% female founders.

This may show a preference to “opt-out” completely from the traditional male-dominated startups, and instead choose to work with ones that were run by women or have a culture where women leaders are present and visible. It could also show that startups with a small percentage of female founders are tokenistic. This means they may “check the diversity box” by having a token women on the leadership team, but don’t make any real effort to create an inclusive startup.

2. Moms face extra barriers

Though it wasn’t incredibly surprising that male respondents were more likely than female respondents to have a stay at home spouse, what was surprising was the drastic scale of the difference. Men were thirty times more likely than women to have a stay at home spouse (30% of men vs 1% of women). In the startup world, where long hours are often part of the job, it’s an incredible benefit to have that level of support.

Men working at Seattle startups were also twice as likely as women to have young children. Given the fact that most people working for startups are between ages 25-35, which are key childbearing years, excluding women with young children means that Seattle startups are missing out on a large talent pool.

That said, some respondents reported that their startup was able to support parents well, which was usually based in strong policies and true buy-in from leadership.

3. Seattle has both gender and racial wage gaps in startups

Though women are more highly educated, more experienced, and older on average than men in startups, they are paid less and are much less likely to hold leadership positions. We found a gender wage gap of 10% and a racial wage gap of 15% (or $15,870). However, this only included wages under $100,000, so the real wage gaps are likely much larger, since they tend to widen at higher salaries.

4. Seattle startup culture benefits men

83% of women and 73% of men agreed that men have an advantage in the startup world. This showed up in several ways. Men were more likely to feel included at events, have better access to mentors, and felt as though they were more trusted. Women, on the other hand, reported feeling as though they were penalized for displaying leadership traits, didn’t feel as included at events, and faced daily micro-aggressions such as facing harassment and being spoken over.

As one person put it: “I have had people assume I am the intern, had my own colleagues interrupt me and had people speak slower & try to "explain" things to me when I was the only woman and person of color in the room.”

Interview

Why did you take on this project?

“First of all, because there was virtually no data on gender in Seattle startups. Data is powerful because it helps us understand how to improve, and whether we’re making progress. Secondly, as a reminder that Seattle still has a lot of work to do. Even though we are a relatively progressive city in a lot of ways, it’s also easy for us to lose focus and think that we’ve already ‘solved’ these inequities, when in fact we’re not there yet.”

Why not study female founders?

“Most of the conversation around gender equity is focused on telling individual women what to do. That’s why we see so many negotiation workshops, tutorials on power poses, even clothing ads tell women how to dress to become the boss. Though this empowerment aspect is important, it’s only a small piece of the puzzle. A much larger piece is looking at systems--in this case, the way we run our startups. This study was meant to help unveil some of the mystery around how gender inequities play out in startups. Since the industry is still heavily male-dominated, it will actually require the active involvement of more men than women. And men have a lot to gain from gender equity as well! For example, quite a few male respondents indicated they wish they could have more time with their family. As one of my favorite quotes goes “Equal rights for others does not mean less rights for you. It’s not pie.””

What should people do now?

We led this study so that the data could be used. Read through it, think about how it applies to your startup, and mine it for clues to how you can improve. We all have work to do, and taking that first step is a brave but necessary move. If you’re in an early stage startup, prioritize creating a diverse founding team. The ripple effects of this investment will pay off hugely down the road. Your products will be better, your business will be more inclusive, and studies show your bottom line will do better. If you run a more established startup, think about phasing in good policies like pay transparency, flexible working options, and caregiver support. Contact us at www.CatalyzeSeattle.org for more information on resources to get started.

Martha Burwell
Martha Burwell
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