Blackbird Ventures, one of Australia’s most esteemed venture capital firms investing in early stage tech companies, has begun making deliberate efforts to improve the gender diversity of its portfolio businesses.
The VC firm runs Startmate and is using the accelerator program to trial and experiment with new techniques and programs to attract more women-founded and run companies.
Blackbird’s vice-president of operations and Startmate partner Samantha Wong outlined how the organisation made some practical changes with its 2017 accelerator intake and challenged its own longstanding rules.
“We acknowledged upfront that we really didn’t know what we were doing and we would approach [the problem] like a startup – we would come up with a bunch of experiments and get fast feedback,” Ms Wong told the InnovationAus.com Women in VC event in Sydney.
Blackbird’s desire to improve the diversity of its portfolio come from an economic and socially conscious point of view, Ms Wong said.
“In the first Blackbird fund, 10 per cent of companies were female-founded but accounted for 20 per cent of the fund’s value. If you include companies with senior female executives, they accounted for 15 per cent of the portfolio but 42 per cent of its value,” she said.
“That’s a strong signal, and a good reason to try to find more gender diversity.”
The Startmate team began by setting a simple goal – for half of its accelerator intake to be female-founded startups. But to achieve this they didn’t set a quota, but instead looked to make the program more accessible and compelling for women.
The first step was to update Startmate’s “dude-fest” website, making all content and photographs equally split between men and women.
The organisation then went out in search of female entrepreneurs to act as “beacons for up-and-coming female founders” by partnering with the likes of SheHacks and the Female Founders Committee and online channels.
Another initiative centred on an old fashioned outbound sales effort. Blackbird collated all the impressive female entrepreneurs and founders they’d met, along with those put forward by connections and alumni, and encouraged them to apply for the 2017 Startmate accelerator program.
But according to Ms Wong, the most important thing that Blackbird did to improve its diversity was to challenge its own rules and assumptions, and look at how these may be deterring women from applying.
Previous rules, like not accepting solo founders, companies without a technical founder and those who could not relocate to Startmate’s Sydney base, were thrown out the window.
“Instead of having blanket rules we asked ourselves what these companies need to be successful in the next three to five months – what evidence do they have that the product is good enough to sell large amounts and that they have the technical resources they need to sell it? If they had this evidence, then we wouldn’t rule them out,” Ms Wong said.
One of the team’s ‘wish list’ companies included a co-founder that was due to give birth when the program begun, and would be unable to work from the Sydney office.
“That was a really interesting challenge for us. If we were serious about diversity we couldn’t rule this company out on this basis alone,” Ms Wong said.
“The reality is that if we hadn’t challenged ourselves over those three things we wouldn’t have had a single female-led company in this cohort, and the group would have been much worse for it. We need to keep challenge ourselves and our assumptions along the way where it makes sense.”
As a result of those efforts, Blackbird was on track to achieve its 50 per cent goal, until a “founder bust-up” got in the way. In the end, two out of the six companies accepted into the program were female-founded.
“It’s an improvement, but it’s not where we want to be,” Ms Wong said.
“The biggest improvement was right at the top, we had almost double the number of applications than last year. The outreach really did make a difference.”
For other VC firms looking to tackle this big issue, Ms Wong has some simple advice: set public targets, ask the community for help, and get out of the building.
While the first attempt fell just short, Startmate and Blackbird Ventures had been buoyed by the improvements and will be looking to make bigger inroads later this year.
“We will continue iterating. We’ve made good progress but we have a ways to go,” Ms Wong said.