Saturday, April 28, 2007

My question for today: Are women not supposed to want to make money?

I've been wondering lately why everyone I talk to in investment-obsessed Silicon Valley makes note that they see very few women entrepreneurs. This anecdotal observation doesn't jive with the stat that over half of the businesses started in the US are woman-owned.

Now, I've seen some folks theorize that women are more risk-averse, and therefore they avoid going for large outside investment, preferring to use funding that they are more in control of and answer mostly to themselves about. I definitely see validity to this theory, particularly if you consider that the majority of funders are men, and there might be a lot of women starting their own businesses precisely to get away from being answerable to a male-dominated hierarchy of some sort.

But I've also had another thought lately: do women face more disdain than men when they are ambitious, particularly ambitious to build a profitable business?

My personal experience is that if you're talking career ambition, yes, folks seem to think women should stay satisfied longer with any gains they've already made and spend more time proving themselves to get to the next step. I had a CEO say to me something along the lines of "You've come pretty far, aren't you satisfied with that?" and I had real trouble imagining him saying that to some of my male colleagues...even the younger, less qualified ones. (There's a whole story there about the CEO's hiring and promoting practices, but I'll just ask you to trust me on that one!) The overt response to my request to discuss my career path was that I should know my place. That I should continue to do the work of leading the team, but let someone be a figurehead above me...and be satisfied with that because, after all, I was pretty prominent and fairly well-compensated already...what more could I possibly want?

When it comes to money it is quite popular these days to say that women don't make more because they don't ask. But recent studies show that about a quarter of the male-female pay gap cannot be attributed to negotiation, taking time off for child-rearing or any other aspect within the woman's control. [More discussion and links can be found on this BlogHer post.]

So, my theory on why Silicon Valley investors see few women entrepreneurs is this: maybe women are sick of being judged differently for their desire to make, earn, raise money. Maybe that is why they take small business loans, or turn to their friends and family, or draw on their home equity, or do a bunch of other things that will keep them out of the public eye and out of people wondering aloud how they can deign to be part of a commercial though it was somehow less feminine of them to create a for-profit company!.

All you have to do is look at the different reactions to Mike Arrington making a ton of $$ from TechCrunch (essentially: what a blogging stud!) vs. the reactions to popular women bloggers such as, let's say, a MommyBlogger or two, doing the same (essentially: what sell-outs, what evil exploiters of their readers!)

I'm not saying that only men do this to women, by the way.

Am I naive that I believe that a desire to make money is rarely about wanting to roll around in bed with it a la Demi Moore, but rather is usually made up of some parts of the following: to build a business they believe in, to hire smart, capable people, to be able to compensate those employees to the level they deserve and the level that will keep them a happy employee, to support their families, to provide for retirement, to be able to care for their parents when they are unable to do so and so on. Money does equal security on many levels for most of us. And opportunity. And freedom.

So, my purely speculative musings beg the question: anyone else out there notice the double standard? Or am I smoking crack on this?

Well, you're not exactly smoking crack and the double standard is very real.

At the same time, I think that your POV might be just a little skewed by that Silicon Valley tech startup culture.

To begin with, most of the people in the country (people, not just women) starting businesses these days want to keep them very small. These are the lifestyle businesses, run by people who don't want the firm to grow so large that they have to stop producing or doing whatever it is they're doing in order to run a company.

It's not that they don't want to make money, either. It's just that they don't want to build empires. There are other things they want to do.

As for that risk-averse thing, I read some research recently which found that entrepreneurs, as a group, are actually a little bit more risk averse than most wage earners. What distinguishes entrepreneurs is not being risk tolerant but being so supremely confident that things others see as risky are things the entrepreneur doesn't worry about because they are certain they can deal with it.

Make of that what you will. :)

I think a big part of the problem you identify has to do with networks. Let's face it, a lot of those decisions about who gets funded and even who gets access to the VCs and the angels in the first place has to do with who's in your network. Now that more and more women are playing golf, I have a feeling that a sizable chunk of business gets done in the men's room over the urinals.

That's one reason why there are so many pleas and calls for more woman-owned venture capital firms and angel consortiums. It's not even that women are assumed to be more willing to invest in women-owned businesses (although they probably are), it's that women entrepreneurs are more likely to have a bunch of other women in their networks.

Do ambitious women face more disdain? I suspect that depends on who you hang out with but, in general, I think you're probably right about that. I've never heard anybody speculate about the probable psychiatric health of the children of male CEOs the way they do about women.

On a certain level, I think the "women should be satisfied" thing has to do with the fact that a lot of men are probably tired of listening to women complain. The heyday of the women's movement was back in the 1970s -- that was 30 years ago. Imagine the married couple, together for a couple of decades, and picture how the husband typically reacts when he hears his wife complaining about that again ... the thing she's been complaining about for 15 years.

"Yeah, okay, so I forgot to put down the toilet seat again today. I remembered last week. Why isn't that good enough? Geez!"

Of course, the obvious answer to that is that we would stop complaining if we didn't have things to complain about anymore. But, then, you knew that.

Sorry for the long-windedness but that's what happens when the thoughts get provoked. Good post!
Great comment, Dawn. I think you're right that Silicon valley may be slightly different than other areas, but I think the double standard is not geography-dependent :)

"I've never heard anybody speculate about the probable psychiatric health of the children of male CEOs the way they do about women."

ARGH, so true! No one asks a male CEO who's home taking care of the kids, do they?
Ah! Touche Elisa. I've yet to see a male CEO that is expected to manage the homefront, as well as his CEO responsibilities. No tossing in a load of laundry, making sure lunches are made and backpacks are ready to go before he rushes off to a board meeting. Yet, women often do all of these things (and much, much more while still holding down top level responsibilites in their career). In my years of corporate life, I truly have never heard one male CEO that was asked 'who's watching your kids'.

I also think Dawn makes a good point in that many women are not into building empires. I believe we are as capable and perfectly willing to make our share of the money in smaller concerns and are not as drawn to the need for large scale personal visibility as many male CEO's in the larger, VC backed firms.

So, hats off to all the women entrepreneurs who are going the extra mile, bringing home plenty of bacon and flipn' it too!

Robin Ogden
Not only are women entrepreneurs starting more new businesses every day than their male counterparts, but I've read a study that women are more skilled and more knowledgable as well. Maybe women are less likely to take risks, but when you know your product so well it's not nearly as big of a risk.
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