Beyond Drawn Lines
While the gender pay gap is by no means an insignificant issue, the gender investment gap exists and needs to be addressed as well, now more than ever. Here’s Sarah Chen of Beyond The Billion’s two cents
Washington-based venture capitalist Sarah Chen insists that the gender investment gap exists and that it needs to be addressed now, more than ever
It was 8am in Washington DC and 8pm in Malaysia when Sarah Chen and I had our call over Zoom; the founding partner of Beyond The Billion was one of Forbes’ 30 Under 30, and was recently named Young Global Leader by the World Economic Forum this year. Chatting about the current state of affairs to kick things off, we inevitably addressed the undercurrent of panic that’s been building up over the past few months. “It’s been rather crazy out here,” Chen admits, “so we definitely have our hands full at the moment.”
With industries being impacted on a global scale, it isn’t any wonder that many are struggling to put out metaphorical fires, including the venture capital industry—which, according to Chen, is seeing a massive shakeout in the works. “The business was already tough to begin with,” she explains. “Especially now with the pandemic and its new normal, people are starting to witness the fallout of focusing way too much on vanity metrics. It’s a hard thing to say, but it’s a reality check for everyone involved in terms of where we’re fuelling the money as priorities shift.”
That very shift on what’s perceived as important to invest in is driven by human behaviour, involving not only the business of chance and risk-taking, but a certain amount of trust. A trust, Chen tells me, that isn’t easily given to anyone outside the confines of what’s visually considered as successful or able to succeed despite studies indicating that gender-diverse teams outperform homogeneuous ones. “Success doesn’t, and has never historically looked like you and I,” she says. “We don’t look like stereotypical ‘safe bets’ either, because in the context of the Law of Familiarity and pattern matching, we’re considered a minority.
“Be it being a woman or a person of colour, we’ve never really been in the fold of the financial ecosystem — and because of how difficult it is to enter it to begin with, we’re mentally prepared for the inevitability of failure, we’re going to be more cautious, more resilient and strap ourselves in for the ride as much as we can. But how can we showcase that or build our track record, when you don’t let us in the first place?”
And although Chen observes a positive reaction from
the conversations Beyond The Billion has had with decision makers and people in positions of power that were once typically risk-averse, she confesses the issue required more than just beginning a conversation. “It irks me so much, because there isn’t a lot of money flowing despite all of these fancy conferences and the panels I did for raising awareness, so what’s the point of all that if you’re not going to invest in them anyway?
“But that’s going to change if we amplify success stories,” Chen continues. “And as an optimist, I believe that when we as women increase our own net-worth, we’re able to become investors ourselves and get more of us to join the field to enable opportunities for women to join in on the business on decision-making.”
Coined as the Virtuous Venture Cycle, one of Beyond the Billion’s core agendas is to address this particular system; whereby stakeholders (in this case, the investors) are encouraged to invest or engage more due to increased
impact, which in turn drives that impact. “I’ll give you an example. Let’s talk about Silicon Valley (the 2014 TV series). I’m just starting to watch it myself, and although it’s stereotyping, you have the ‘nerds’ right? They’re a part of the tech scene and weren’t part of the ‘it’ crowd in high school, but they turned out to be successful today. Why is that? It’s because they were into tech and were able to build these great innovations!
“And as an investor, I’m going to want to invest in them because of those innovations—that in return transforms them into these big guys on campus as the construct of tech opens all these doors. Take that example and apply it to the context of the gender investment gap—or any kind of gender related gap—and how success stories can help bridge that. You’ve got New Zealand’s Prime Minister Jacinda Ardern, who was unmarried and pregnant while she was still in office in 2018. She was essentially breaking all the rules, and against the norms of tradition.”
However, Chen notes that it bears mentioning that the crux of the problem lies within the unconscious biases built by a flawed, rarely checked framework. “Bottom line is, when you’re able to show that it can be done, you’ll have to accept it for what it is, because if you take gender out of that equation, what’s left is results and that’s what everyone is looking for,” she stresses. “Which means money and that’s the way to play the game. They say that if you invest in a woman, you’re in good company because diversity drives actual returns and is good for business.”
Thornhill Medical, a medical technology manufacturer in Toronto, Canada, is led by president and chief executive officer Lesley Gouldie; and is one such example as they are one of the five female-founded-andled companies Chen mentions in her article for Beyond The Billion on Medium. She tells me that they all but quintupled their military grade and battery powered mobile ventilators, working alongside Canada’s Prime Minister Justin Trudeau on the frontlines as they combat the ongoing crisis.
One sentence in particular stood out to me in Chen’s article: ‘by leaving out 50 per cent of the population, we could be excluding their (the women) lens of the world and the great innovations they bring which benefit us all.’ And in the face of a new normal affecting the entire globe, it’s an all-hands-on-deck situation that requires more inclusivity and less exclusivity.
“I like to use the sandbox metaphor when it comes to entrepreneurship,” she says, taking a sip of her coffee as we reach the tail-end of our conversation. “You let your little boy jump around, explore, build, experiment and get dirty—but then you tell your little girl to be careful because she can’t get her nice dress dirty. But if you’re an entrepreneur, your work involves taking risks, experimenting and getting your hands dirty! There are nuances, but seeing a woman boxed in and limited because she’s a woman? That hurts.”
“Diversity opens up more opportunities, and that’s good for business”