We are all familiar with the gender parity issues at the C-suite and Board level roles. Regardless of all the hype, however, we are not seeing very much progress particularly within startup organizations. Given the growing number of startup businesses, this is an important group to pay attention to.
My experience as an Executive Search Leader has allowed me the opportunity to have thousands of conversations with female Leaders around the nation. Over the years, I have enjoyed getting to know many of them and learning what drives them, what motivates them, and what tremendous leaders they are.
Here is what I have learned about how to find them and recruit them.
First, the data.
According to Silicon Valley Bank's 2020 Women in US Technology Leadership Report, the gender parity gap continues to exist in a major way. This report was focused on US startup companies and the data is disappointing.
"More than half of US startups lack women in leadership."
This means that 58% of US startups do not have any female leadership at the Executive nor Board level. The remaining 42% of US startups have at least one female executive on their team. The report does note that the female executives tend to be more attracted to healthcare businesses rather than pure technology (they also are more likely to go for a science-oriented degree rather an engineering one). When reviewing the startups' board of directors, only 40% of these companies have at least one female board member.
"About 1 in 4 US startups has a woman on the founding team." and "14% of US startups have a female CEO."
The bottom line is that if there is a female member on the founding team, it is more likely for those organizations to have a female CEO. On the flip side, only 2% of the organizations that have male founders has a female CEO.
"Two-thirds of US VC firms do not have any female partners."
Female led startups are less likely to rely on VC funding but that is not surprising since 65% of the VC firms do not have any female partners to relate to.
Why this data is important to startups.
As a startup founder or executive, your primary focus is on quick results. You need to come up with a strong product that demonstrates strong potential and reach the market as fast as you can. Given the pressure to prove your potential quickly, you don't have any time to waste and you need to hire Leaders who are effective.
In your haste to hire, you may be drawn to the Leaders who demonstrate the traits that excite you - they are energetic, charismatic, passionate, self-promoting, and excitable. You may be drawn to the energy that can be more predominantly demonstrated by male candidates.
It's important to know that there's a strong difference between leadership emergence (those traits that get you noticed and promoted quickly, typically the traits noted above) and leadership effectiveness (those traits that make you perform well and are impactful to the business). It is just as important to know that the gender differences in leadership effectiveness do not align with the gender differences in leadership emergence.
Important Note: We should also learn from our peers' mistakes and know that the top three reasons why startups have failed (based on CB Insights) are:
Lack of market need (42%)
Lack of cash (29%)
Wrong management team (23%)
This means that one in four of our startups will fail due to poor or wrong leadership talent.
So why female leaders then?
Over the years, I have had the privilege of learning so much from both male and female leaders around the world, both personally and professionally. Here is what they have demonstrated and shared with me.
Women are purpose-driven.
Female leaders are attracted to mission-driven organizations that are making a difference. They are are not motivated by a role's status, power, or reward as much as they are motivated by making a positive impact to the community, the employees, and/or the broader world around them. They want to shape an organizational culture and have a leadership purpose.
Personal Story: While recruiting for an exciting new C-level position with a technology company, I identified a few female leaders who met all of the requirements, had really impressive backgrounds, and from what I could tell had a very strong brand and track record. I was thrilled to talk to them. Knowing that these leaders were not actively looking for a change, it took weeks to get them on the phone. Once I did, each conversation turned about to be more exciting than I had hoped for. They did not want to hear very much about the organizational structure or size/scope details of the role. Instead, they wanted to hear A LOT about the organization's mission. What were they trying to accomplish? Who is the CEO and what was their vision? How was this business going to improve people's lives?
Recruiting Tip: Establish a well-defined mission and vision that builds purpose into your day-to-day and be able to articulate this well to candidates. Demonstrate your mission-driven culture in every decision you make - from organizational structure, people strategies, and business processes. For each specific role, be prepared to articulate how that role will contribute to the company's values and how that individual will be able to accomplish the mission.
Women are strong servant leaders.
Our culture has led us to believe that the best leaders are those that demonstrate a lot of charisma, have a large presence, and an abundance of confidence. Women leaders, however, bring a more holistic style that has proven to be incredibly effective (although much more subtle). Their style embraces the natural feminine side that is much more transformational, nurturing, emotionally intelligent, and communicative (alongside having market insight, developing and articulating a vision, having strategic capabilities, and executing against goals). In many ways, women are naturally tough on the tasks while remaining softer on the people which makes them very good servant leaders.
The concept of servant leadership may make you think of an unassertive leader, while in fact it is the complete opposite. Servant leadership is an impactful leadership style that is committed to growth, increases financial success, and improves the performance of the business. Servant leaders are humble, persuasive, strong community builders, and have excellent foresight.
All entrepreneurs should be servant leaders.
Personal Story: While working with a biotech firm, I was partnering with a female CFO who had large tasks ahead of her including preparing the organization for a potential IPO while building her team's capabilities. Her peers were getting increasingly excited about the stress and conflicting demands. They were demanding more while showing less patience, creating a stressful environment for many of their team members.
In the meantime, this CFO leader remained sensitive and empathetic. She checked in with her team and asked them to take mental breaks. She shared in their successes as well as the burden, knowing all too well that the team's overall success will be a collective effort. Over the months I worked with her, I watched as her team continued to deliver against their goals. She hired additional talent and the team remained positive and supportive. Her team did not get burnt out, the team's dedication strengthened, and their daily work remained meaningful.
Recruiting Tip: Women (and other servant leaders) do not self-promote as much so you will need to actively target and reach out to them. They tend to build networks that are geared toward helping them succeed at their current job (not get a better job) so adjust your recruiting strategy accordingly. To attract them, servant leaders want to work with others who share in their leadership values and honor the people around them. They are attracted to organizations who aren't afraid to rethink their programs to meet the needs of their employees, provide opportunities of choice and flexibility, and demonstrate high integrity with actionable examples (just saying the right things doesn't mean very much anymore).
Women demand authenticity (as do your customers).
Consumers are increasingly craving authenticity - authenticity in your products, your brands, they way you protect them, and responsibility in the way you conduct your business. Authenticity in your business means you have the best of intentions and follow through on them, allowing your customers to trust in you.
Female leaders are also craving authenticity in the leaders around them. Authentic leadership means you're demonstrating behaviors that enable your team members to feel safe and trust in you. You take ownership while sharing responsibility for mistakes and you have the courage necessary to challenge the status quo while defending your people and processes.
Personal Story: While coaching a female leader at a fintech firm, we had to address her challenges around recruiting and retaining strong talent. She reported into a male CEO who was very results focused and was becoming increasingly frustrated with her inability to connect and build her team. In the meantime, the organization hosted a leadership development program that focused on building leadership authenticity. It was in this conference that we realized that this female leader did not feel that she had the freedom to be who she is (both outside and at work) and she did not feel the support of her CEO to discuss it openly with him. She admitted, with quite a bit of emotion, that she was experiencing some personal trauma and felt the need to hide it from everyone she works with. The CEO's leadership style was not allowing her the freedom to be authentic and vulnerable and, therefore, she did not have the courage to get real. This female leader ultimately left the company and joined a competing organization that, coincidentally (or not), was led by a female CEO.
Recruiting Tip: Authenticity cannot be faked during a recruitment process. Authenticity means having transparency and sharing with the candidates what the true challenges in the organization are, what the risks are, and what the realities are of the role's impact. It's about sharing the good, the bad, and ugly in order to make the right decisions for the team. For female leaders, authenticity is demonstrated by the amount of openness, depth of the connections made during the interviewing process, and the care and attention put into their experience.
About An McLeod
An McLeod is Founder of HEXA Executive Search. She is an experienced Executive Search Leader and Certified Coach who helps high-growth companies build their leadership teams and bench strength.
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