Is the startup scene still a boys’ club? Sadly, the numbers say so: In Germany, only every fifth founder is female. In Europe, male founders received 92 % of all the funding in 2019. In the US only 28 % of all startups had at least one female founder on the team.
Our Investment Associate Lisa Liu and Gyri Reiersen, founder of our portfolio company tanso, know firsthand how these statistics impact women in the startup business every day. In this interview, they talk about the toughest problems and share ideas on how all of us could encourage female founders and work towards more diversity in the startup scene.
The two of you are still exceptions in the startup ecosystem. What was your start in this business like?
Lisa: When I first got into contact with the startup scene, I remember quite well being the only woman in the team – and I continued to be the only one for quite a while. For some years now, however, the entire industry has been undergoing change. When I first attended a VC ladies’ meetup in Berlin, we were only ten women there. Now we need to search for a bigger location as more than 60 ladies come together on a regular basis.
Gyri: There is definitively a change, but it is still slow. What I observe is that the whole perception around entrepreneurship is changing. If you look back just ten or twenty years, starting your own business was like gambling: You could make huge profits, but you would have to take huge risks to do so, and if you failed, you could really go to ruin. Today, some risks are still there, but it’s also okay to fail. At the same time, I see much more passion and purpose being poured into startups. It is not all about getting famous and making money anymore. These trends attract a different kind of people, I think. And probably more women than before.
Lisa: I see that point, but I wouldn't agree that women are generally less risk-taking. I think women just see the risks more clearly and put weight on them.
Gyri: Yes, I totally agree, and of course, diversity also exists within gender. For example, I often relate more to my male friends in certain aspects. Still, it took me three months to be convinced before I said yes to founding a company. Not only because I saw and assessed the risks carefully, but I didn't want to do this just to do it. I knew very well that I’d only take the risk if there was a purpose behind it.
You have both been active in the scene for years. What experiences have you had?
Gyri: To be honest, I was super shocked when I moved from Norway to Germany. I wasn’t used to questions like “Are you sure you can code?”. In Norway, I grew up seeing powerful women in powerful positions, so having female role models around was more normal for me. In Germany and in a lot of other countries, there are far fewer role models and that’s a big part of the problem, I believe.
Lisa: Even today, most of the big success stories are still driven by male founders. So, it’s no surprise that women can’t relate to the whole ecosystem in the same way men do – which in effect results in their low representation, and once you do enter the industry as a woman, there are two sides. On the one hand, if you are one of the few women around, it's a bit of an advantage because immediately everybody recognizes you, but on the other hand – and this is a very important part – it's very difficult to connect to the people around the same way men connect with men. If two male colleagues go out for a beer, it’s normal, but if a man and a woman go for drinks, it raises suspicion that there might be something more. I think this is not spoken about enough, but it is very serious because our whole ecosystem is driven by networks.
Gyri: I think every woman in the ecosystem knows what you mean. As you say, being special can sometimes be good because people see you, but it can also fall back on you if your advice is only asked for because the question has to do with women. For instance, working in VC I have gotten questions like “Gyri, this is a femtech product. Can you just look at it and decide if women think it's good or not?”
A lot of challenges. What needs to happen to drive true change?
Lisa: The good news is: We already see some change. We have way more female-lead VCs, more female founders, our networks are growing, but still, we're lacking women at the top levels that we can relate and look up to. For a long time, I wasn’t a fan of quotas, but now I’m starting to see why they could be useful – for a transition period, not forever. Without quotas, too many men are going to invest only in men. It won’t suffice to just hope this will change on its own. With quotas, we will have more women coming in, we will have more role models and this will spark the whole transition.
Gyri: This actually works: In 2007, the Norwegian government introduced a quota of 40% women on public boards – in just ten years, they went from 4% to 42%. Then they simply removed the quota because they didn’t need it anymore. The interesting part is: during this time, the private sector, which was not regulated, also reached 30%. There were exceptional women who got an opportunity in public companies, and there was the private sector, which then reached out to these women.
Lisa: The mere fact that there are women on the team helps to connect with female founders. When I speak to a female founder, I can see how she feels more comfortable with me and can relate more compared to sitting in a room with only men. So, that’s a start, but certainly not enough. That’s why we’re very dedicated to the Female Founders Initiative, an accelerator that only supports teams with a minimum of one female founder.
Gyri: There are two issues we need to tackle: We as founders and VCs have to do our homework, for example coming up with internal quotas, ways to foster and safeguard diversity, and so on. At tanso for example, we have established a very clear plan on how we want to reach out to women in our different hiring positions. At the same time, there are still a lot of deep structural issues such as parental support and tax incentives working against gender equality. These issues need to be addressed by politics and businesses. Only if these two sides come together, we’ll see real change.