Further to go: women, technology and venture capital

Wherever you look in Canada’s technology sectors, from the pre-revenue startup to the Bay Street boardroom, you find too few women in leadership roles.

That’s the main message of a new report on the state of gender disparity in innovation.

Where’s the Dial Now?, co-authored by MoveTheDial, PwC Canada and MaRS Discovery District, draws on numerous sources, including data for some 933 tech businesses, to produce a comprehensive study of female representation in the ranks of tech executives, founders and boards.

The results are, in a word, startling. 

Today, only 5 percent of Canadian tech companies have a woman founder, the report found. The share grows to 13 percent when tech companies with male and female co-founders are included.

Additionally, only 5 percent of tech companies have a female CEO. In fact, women make up only 13 percent of the average tech company’s executive team, while more than half of tech companies reflect no female representation at this level. Boards of directors are similarly dominated by men.

Jodi Kovitz, founder of MoveTheDial, a Toronto organization focused on advancing women in techsays the study sounds an alarm in Canada’s tech sectors.

Jodi Kovitz, Founder, MoveTheDial, and CEO, AceTech Ontario
Jodi Kovitz, Founder, MoveTheDial, and CEO, AceTech Ontario

“I view this as a wakeup call to all of us,” Kovitz told PE Hub Canada. “It’s a call to do more to create an inclusive role for women at the technology leadership table. I hope people will see it as an opportunity to do better.”

Kovitz says a “mindset shift” is key to closing innovation’s gender gap. She sees the report itself as a step in the right direction as it offers first-time data on a topic that often lacks transparency. It provides a benchmark against which progress can be measured, she added.

Where’s the Dial Now? also contains evidence of “positive change,” Kovitz said. For example, it highlights MaRS research that shows between 28 percent and 30 percent of emerging startups in Canada have at least one woman on the founding team.

For Michelle McBane, a senior investment director at MaRS Investment Accelerator Fund, the statistic points to a new generation of women with entrepreneurial goals.

Michelle McBane, Senior Investment Director, MaRS Investment Accelerator Fund
Michelle McBane, Senior Investment Director, MaRS Investment Accelerator Fund

“More women are getting the startup bug,” McBane said. “That’s because more women are in the tech workplace, where they’re gaining experience as well as inspiration from female role models.”

Earlier in 2017, McBane helped launch StandUp Ventures Fund I, a pre-seed and seed fund that invests in tech companies with at least one female founder in the C-suite. Currently in fundraising mode, it expects to close four deals by the end of December.

Today, the fund announced its second investment. StandUp and MaRS IAF co-led a $2 million financing of Bridgit, a mobile construction project manager founded by Mallorie Brodie and Lauren Lake.

McBane says the Bridgit round and an earlier financing of supplier intelligence platform Tealbook, founded by Stephany Lapierre, are examples of a substantial and growing pipeline of women-led opportunities in Canada. “There’s no issue finding deals,” she said.

Kovitz and McBane emphasize venture capital’s role in backing female founders, who may help reshape overall trends. An essential factor in increased deals is “visible, partner-level women at the table making investment decisions,” McBane said.

The report found a relatively large share of Canadian VC firms with female investment pros. Data collected from the Canadian Venture Capital and Private Equity Association and MaRS show about 30 percent of firms have a female partner. Additionally, an average of 12 percent of partners are women.

An analysis of the U.S. venture industry by Venture Capital Journal’s Kaitlyn Landgraf Bartley suggests investment in women-run startups has slowly improved over time. Bartley found 1 in 6 deals is currently with a company led or founded by a woman, compared to 1 in 20 in 1999.

Kovitz and McBane say addressing gender disparity is in the interest of all stakeholders in Canada’s innovative ecosystem.

“Greater diversity results in better business outcomes,” Kovitz said. “To succeed, you can’t leave half of the talent pool on the sidelines.”

A copy of Where’s the Dial Now? can be downloaded here.

Photo of businesswoman running courtesy of xavigm/iStock/Getty Images

Photo of Jodi Kovitz courtesy of MoveTheDial

Photo of Michelle McBane courtesy of MaRS Investment Accelerator Fund