Startup companies are historically known for being male-dominated. In 2021, just 12 percent of new unicorns (a privately held startup company valued over $1 billion) had at least one female founder—a number that has not changed much in recent years. In tech specifically, women are a minority but their numbers have steadily increased—from 7 percent to 27 percent—over the past fifty years. However, tech still has a ways to go when it comes to gender diversity.
1. Shortage of female tech students
The United States Census Bureau found that men make up 52 percent of all U.S. workers but 73 percent of all science, technology, engineering, and math (STEM) workers. Female students tend to shy away from math and science compared to their male counterparts resulting in a shortage of women in tech roles. It’s estimated that approximately 80 percent of future jobs will require STEM skills but only 27 percent of young women would consider a career in technology and only 3 percent consider it their first career choice.
To assist girls in building STEM skills and helping them feel more comfortable, it’s up to schools—from elementary through high school—to introduce computing and technology courses. Immersion programs such as Girls Who Code and Canada Learning Code offer hands-on experience. Role models, examples of successful women in tech, and demonstrations of how STEM impacts the world can provide girls with the inspiration they need to pursue a career in the field.
2. Less frequently promoted
The number of men and women in tech that stive to be promoted is similar but women hold less than 30 percent of leadership roles in the industry. 39 percent of women in technology roles view gender bias as a primary reason for not being offered a promotion. This is disappointing news for businesses because organizations with women well represented in senior technical roles earn up to 50 percent higher profits.
Promotions of women early in their careers are critical to their future success. Companies that are successful at this are more likely to retain them and in the long run, prepare more women for senior tech roles within their organization. Offer support and mentorship to early-tenure women, opportunities for skill-building, and put policies and processes in place that ensure that all employees have equal opportunities to be promoted and advance within the company.
3. Inequitable corporate culture
48 percent of women in STEM positions report discrimination in the recruitment and hiring process. Compared to just 10 percent of men, 57 percent of women working in tech have experienced gender discrimination in the workplace. Sadly, by the age of 35, half of the young women who go into tech jobs end up leaving the field.
Early-stage companies have the ability to be intentional about creating a workplace culture centered around inclusion and belonging. Tech leaders need to ensure that all their team members—both male and female—have a voice and can bring their authentic selves to work each day. To appeal to women in tech, organizations must develop career paths and formal and informal learning and development opportunities.
4. Lack of funding for female-led startups
Numerous studies have found that male entrepreneurs can get early-stage capital more easily than women. Female founders secure just 2 percent of venture capital even though companies with at least one female founder perform 63 percent better than those with all-male founders.
The good news is that the pool of female investors is growing. The PitchBook report found that at the end of 2019, 12 percent of general partners at venture capital firms were women and there were 740 female angel investors. At the end of 2021, women comprised 15 percent of general partners at venture capital firms, and there were about 1,000 female angel investors. Organizations like Women Who Tech are breaking down barriers and assisting female tech entrepreneurs to get startup funding.
What can organizations do?
To overcome the challenges faced by women in tech, it’s important to get girls excited about STEM at an early age, provide them with role models and mentors, promote them in the early stages of their careers, and create an inclusive workplace for them to thrive. Startup organizations that can successfully eliminate the biases and challenges faced by women in tech roles will be much more successful at attracting and retaining top female tech talent to grow their business.
The blog was written by Viaduct Senior Account Executive Roger Naglewski.