Women have been traditionally underrepresented, if not absent, from the boards of technology companies, yet studies have shown that boards with female representation outperform.
In 2018, Women on Boards (Senate Bill 826) was signed to advance equitable gender representation on California corporate boards. As a result, all publicly-held domestic or foreign corporations whose principal executive offices are located in California are required to have at least one female board director by December 31, 2019, either by filling an open seat or by adding a seat and by December 31, 2021, to have two or three women directors, depending upon the size of the public company’s board.
The FirstBoard.io Cohort is a curated group of diverse technology leaders in critical operating roles at Startups and public tech companies. Our members have been driving scale resulting in million-dollar exits and IPOs for companies like Github, Fireeye, Yubico, Ariba, Pivotal Software, Salesforce, Jasper, and many more. Diversifying company boards for improved company performance
Good morning. We are here with Rita Scroggin. She’s going to talk to us about gender equity and diversity and Firstoard.io. Rita, what is FirstBoard.io?
First of all, thank you, Mike, for having me here this morning. FirstBoard.io is an initiative or an approach to get more women on private tech company boards. We’re focusing only on technology, and we’re working together as a collective leveraging each other’s network. We started in January of 2020.
We’re about a year in now, and we had some early successes. So we are off to an excellent start.
We’ve all seen the numbers and how underrepresented women are on boards but do you know some of those numbers, or can you speak that. I’m assuming that was sort of what led you to form this organization.
There’s much documentation about public companies and what those numbers look like. For private companies, numbers are a little unknown, but a study in 2019 looked at private companies and concluded that women hold only seven percent of board seats in those private companies. So it’s a well-understood problem. Particularly in private technology companies, very few women are on the company boards, very few women are venture capitalists, and very few women get funded. This problem leads to less female representation at senior levels impacting other women in the startup ecosystem.
Changing the board-level dynamics will give more women leadership roles and, ultimately, the venture capital community.
I believe that I read recently that those numbers have gotten worse during COVID. That this past year, in particular, was a challenging year for female founders and getting funding. The number of investments in female-led startups was somewhere in the neighborhood of around four percent.
Yes, it’s an insufficient number, and I think particularly African-American women. It’s a dismal number, and much work needs to be done on that front, too.
How do you counter the “only the best” argument? When I was in venture capital, we had these discussions about supporting women-owned businesses. The pushback from the seasoned venture capitalists – the old guys, who were typically all-white guys – was always we don’t look at it like that; we fund the best company. We’re supporting the best, whomever it happens to be. We know that means that we’re not seeing funding for women and stuff like that. How do you respond to that sort of defense?
That has been discussed a lot, and I hear that argument. I think the problem is that often there’s this pattern recognition. VCs are men, and when they see other men pitching an idea, they believe that there’s a pattern they recognize. So, therefore, they perhaps feel more security in funding that company over a company where they’re not familiar with you (women-led).
I think that’s part of the problem and the other problem is that women are not really in the network.
I’ve heard VCs say if we don’t know anybody who is connected to those founders. We won’t even look at the deal. I think it’s a big problem because the existing networks don’t associate with women to the degree they could.
That’s part of what we’re doing at FirstBoard.io – bringing the women who have been technology operating leaders; they have been part of multiple IPOs and acquisitions. They have scaled companies to hundreds of billion dollars of revenue into the fold. But, unfortunately, they’re not being considered for board roles, so we’re trying to move the needle and create a platform for our founding members to become visible and become part of the startup network.
Just yesterday, we had a press release come out about one of our board placements, and it got much attention; and I think it’s an excellent example of a manifestation of how we’re focusing on technology expertise first and then, of course, gender equality going hand in hand with it.
The irony is that study after study has shown that when a woman leads the company, it outperforms those led by their male counterparts.
The crazy part about its study after study has demonstrated that it makes sense to have women in leadership, yet it is disregarded when we pick board members.
During the last decade was much money was invested from the venture capital community into startups. Some of these startups had notable exits, but a lot of the startups also failed.
Right, I mean it is supposed to work that way – the high risk is high risk.
I’m sure you’ve heard about the Kaufman report from a few years ago, which said that venture capital is not as successful as an industry. But, of course, there are a few amazing exits, and we have seen several of those last few years, which make up for all the other failed investments.
I believe that if more emphasis would be put on maybe operating expertise and executing early versus – hey, let’s go like crazy and see where it goes – that perhaps not so many companies would fail, and it would include, you know, a larger share of the population – women and people of color – who would have a chance to participate in the in technology and in the success of the technology.
It sounds like there is a potential chicken and egg problem. Is it more important to get more female founders, or is it more important to get women in venture capital because there are the decision-makers?
I think it’s both. We want to get more women in all the key roles – we want to get more women in venture capital, more women on company boards, and more women in leadership roles. But, unfortunately, we won’t get more women getting funded.
What has been the reception to FirstBoard.io from venture capitalists and the people making those hiring decisions or placement decisions on boards?
We had some early successes, which is fantastic. Four out of members out of 32 have joined boards. Two of those were curated by FirstBoard.io, and we had ongoing discussions with many venture capital firms. So many firms are on board say yes, we believe in the idea and need to do something about it.
We also have many supporters and partners, both men and women, including Steve Singh, a managing director at Madrona, one of Seattle’s prominent VC firms. We have Rohini Chakrahata. She is a partner at ngp capital and in several other smaller VC firms. We have not been able to crack the code with the sequoias of the world, but that’s the goal.
For 2021, we have had a very positive initial reaction, and we need to build upon that momentum. We are connecting our founding members with open board seats. Many other organizations focus on coaching and preparing women to be on the board. Some universities offer classes, etc.
They’re all doing excellent work, but we feel that our approach is best served by being very narrowly focused on technology only and placements on boards.
Do you pick the members, or do the members come to you? What is the selection process?
So far, it’s been word of mouth, and by design, the group is supposed to be a small group because they’re working together. It’s not a large networking organization where we have hundreds of members, and it will never be that. At the moment, we have 50 members, including me. We want to get to know each other and work together. Almost like a company and then add members as we grow after we have laid the foundation. It will always be limited because we don’t want to be just another network organization; we also don’t charge them. Many other organizations charge the women; we instead charge the companies who decide to work with us but not the members. This is a crucial difference in our approach.
What is the typical profile of your members?
Some of them are running companies. Some of them are founders and CEOs. Many others run an owned function, whether marketing, operations, product management, or engineering. Most of our members have presented to boards. Several of our members have P&L responsibility and have been instrumental in IPOs and acquisitions. What they bring to the table is deep technology expertise and understanding of the ecosystem in a particular domain. They bring scale to the table in a specific vertical within tech or just tech in general.
We have a cluster of women who have been in b2b enterprise software, cloud security, and DevOps. We are predominantly in the tech space, but a few members might be slightly outside of that. We have one member who’s our liaison between technology and biotech.
To sort of step back a little, you launched this organization at the beginning of 2020, and then, for those of you who haven’t been paying attention, there’s been this thing called COVID came along. How does that impact what you were trying to do, and how did it shift your model?
We had one meeting in person, and we had in the year before we had a social dinner in November of 2019. everything else has been virtual since then. Initially, the idea was to have women who are only based in the bay area, but we’ve expanded from that, so now we have members in different locations. We have members in Seattle, Boston, Denver, Dallas, and several bay area members. We are now more distributed throughout the country, reflecting what’s happening throughout
with COVID and technology. It isn’t so localized anymore, and members can be in other locations and still participate in the whole ecosystem of technology.
We see in the news is this exodus from the bay area. Is that real? Do you have an opinion on that?
I’ve certainly heard, or I know some people have moved since COVID, but I also know many people who are still here, and I think many people in my network will probably stay here right. at the moment, many things are unknown. At the moment, it’s a lot of waits and sees. And then the question is sort of where’s everybody moving to? I’ve heard places like Idaho, Portland, Seattle, Austin, and Raleigh, North Carolina. On the east coast, they’re looking at Connecticut and places like that.
But I would say I don’t think that silicon valley will be dismantled anytime soon. That’s my opinion.
And of course, we have New York and Boston as well as other areas. These areas have always had activities. I mean, they’re not silicon valley, but we’ve you Raleigh’s got the research triangle. Austin’s been a hot tech scene for a long time. These sort of the second-tier venture capital cities have existed, and how they’re just a little more attractive because the rent’s reasonable and stuff like that.
And no income tax potentially in some states right or reduced income tax. There are some other considerations, and I think for the first time because of COVID and remote working. Previously, if people wanted to have a great career, you have to be pretty much in silicon valley or Seattle. There are more options; for example, Idaho, I think it’s more on the radar, but I don’t think it’s a mass movement.
I believe silicon valley will continue to be the hub. We have the universities here. We have the venture capital firms here, which will still be a driving factor, but you know the world is changing, and it will be interesting to see how it will be in a year or two from now and long term.
The other thing is that networking has changed. Our previous idea of networking was getting together spending time together in person face-to-face. So let’s sit down, let’s have coffee, let’s have a drink. Can you still get that same connection over a zoom channel?
Some of us are doing okay, and for some, it may be challenging because that sort of social charter is harder to do virtual group setting on zoom. That is quite the opportunity. A startup that could replicate the in-person experience virtually could be a game-changer. If a technology company comes up with a platform experience that you know creates the experience of being in the same room, that would be a license to print money, in my opinion.
It’s probably going to be possible. I mean, I can see it in five years or so. This might be an experience we’re all going to have. But at the moment, it’s pretty black and white. We have either virtual meetings like zoom and maybe the occasional face-to-face. We don’t think everybody is looking forward to meeting face to face again.
At FirstBoard.io, we’re hoping to do a significant event in the fall where we invite all the members, of course, all the supporters and our clients and anybody who has to know interest in this topic like to get to know the community.
We’re planning for an in-person event pending the lockdown situation, of course. But, I believe in the person we’ll come back to but maybe in a different form. So, we’ll have to kind of all experiment with what that form will look like.
It’s interesting, I was speaking with someone yesterday, and we were talking about networking, and she says, “you know what, I’ve gotten five hours a day back by not driving around to meetings.” As a mom, between going back and forth to school and dropping off her kids and then running off the networking meetings, she says I now have five more hours in the day because I’m not in the car
That’s an excellent point, right. I spoke to somebody else; she’s an executive at a large company and traveling worldwide. Now that she’s not traveling, she said she stepped out in her backyard for the first time in many, many years and looked at what’s growing there. She had no idea.
People have gained time back. So I think the future is probably in some hybrid. I don’t think anybody wants to go back to commuting an hour and a half for 20 miles each way.
It sounds like the 101
The 101 is an excellent example of that. So I think we will see a change, but nobody knows yet how it will look or what will e the future of work.
What does 2021 look like?
We want to get more visibility. We want to get FirstBoard.io on the radar of every VC firm, every private equity firm, and hopefully, in front of you, know most tech companies’ CEOs. that’s a tall order
We got excellent press coverage, and we just released a press release yesterday. So now we’re planning a pr campaign. First, we will discuss the top 50 women of FirstBoard.io and what they bring to the table.
I’m very confident that we will gain visibility for our collective and get in front of decision-makers.
Is there an expectation that we’ll see chapters in other cities?
That’s an open question. One of our members located in Seattle ad very well connected to the Seattle ecosystem. she will e the present for us in the Seattle community. that is an idea, and we might build out specific locations a little more.
If someone is interested, where can they learn more?
The best place probably right now is to go to our website, FirstBoard.io. It will give an overview of what we’re all about. Our members are visible um on the website so everybody can see who’s part of the group, and then also follow us on our LinkedIn FirstBoard.io page.
I very much appreciate you taking the time this morning to speak with us. I wish you great success with the FirstBoard.io initiative.