More firms should provide in-firm talent programs to foster diversity

In some respects, it’s been a good year for women in VC.

Sequoia Capital named Jess Lee the first female investment partner in the firm’s U.S. operations.

Canaan Partners, which already had three female GPs on its tech and healthcare teams, promoted Julie Papanek to partner.

New Enterprise Associates named Carmen Chang partner and managing director in Asia.

Abbie Celniker joined Third Rock Ventures as a partner, the only woman at the life sciences firm with that title.

Then there’s Austin, Texas-based True Wealth Ventures, which was founded by two female GPs this year with the aim of raising a $20 million fund to invest in women-led companies.

And among the recent successes of female investors are the billion-dollar sales of Dollar Shave Club and Forerunner Ventures, founded by Kirsten Green, was an investor in both, while Cowboy Ventures, founded by Aileen Lee, invested in Dollar Shave Club.

However, it’s still a man’s world. And the chances for women to advance on the partner level is dismal.

The latest to tackle the subject came last week when the National Venture Capital Association and Deloitte released a study that says few women are in investment decision-making positions. Although women make up 45 percent of the overall workforce at venture firms, including 95 percent of administrative jobs, they are underrepresented as partners making investment decisions.

You can download the report and play with an interactive dashboard.

The study, which they said will be updated annually, surveyed 217 firms nationwide and finds that 11 percent of the top partners are women. This is higher than other similar reports.

San Francisco-based Women.VC launched their survey earlier this year and found that female investment partners at corporate and institutionally backed VC firms nationwide make up less than 5 percent of the total. That figure is certain to increase as more women VCs are added to their database, which founder Renata George says will expand to include female angel investors. And the organization, which is working In partnership with VCJ and PE Hub to survey the VC community, is compiling similar market data for Asia and Europe.

Women.VC also found that 30 percent of female investment partners in venture capital are founding partners, and this brings to mind something that the NVCA/Deloitte found.

In addition to looking at gender, the NVCA study also surveyed other facets of diversity, such as veteran and disability status, as well as millennials. One of the overall takeaways from the study is how the management practices of firms foster talent, including programs and strategies designed to enhance diversity.

In other words, VC firms hire women for junior positions or admin roles. But it’s difficult for them to rise up in the ranks, whether it’s large or small-sized firms. So it’s not surprising that female investment professionals leave firms to raise money for their own funds, which many have done, such as Forerunner, Cowboy, True Wealth, Illuminate VenturesAspect Ventures and Aligned Partners, among others.

NVCA/Deloitte found that few VC firms have a talent strategy to promote an inclusive and diverse working environment. Less than one-fourth of the firms surveyed said they have a human capital strategy in place while 17 percent have an inclusion strategy, far below the standards set by corporate America.

So we’re talking about women and diversity in VC. And that’s great. But now it’s time to do something about it and for firms to foster their diverse talent.

Photo courtesy of ©iStock/gmast3r

Correction: An early version misidentified the investments of Forerunner Ventures and Cowboy Ventures. Forerunner backed Dollar Shave Club and, while Cowboy invested in Dollar Shave Club.