About Astia

Tuesday, October 13, 2009

Innovation on my mind

Recently I was asked by Mary Kathleen Flynn of The Deal why I thought there were so few women VCs. While I struggle to answer that question (and I welcome your thoughts if you have them). I have been spending a great deal of time thinking about what it means for innovation if women are not appropriately represented – as innovators, funders and consumers of innovation. My cause for concern was validated this week by John Doerr’s comments as he accepted the Bay Area Business Council Hall of Fame Award with fellow VC Brook Byers. John presented a compelling case for why he believes we are heading for a significant innovation crisis here in the Bay Area – and why this is the challenge of our time. What I heard in his comments was that innovation matters. And if an economic powerhouse like Doerr says it matters – I believe.

Accepting that innovation matters, I return to my original quandary about the role of women in innovation. So I read and I observe and I think. These are the tools I have used to develop the following conclusions about innovation and why you should care if you look around and everyone looks, thinks, sounds, acts and is – JUST LIKE YOU.

Number 1) Smart people have told us that diversity results in better innovation: “The diverse group almost always outperforms the group of the best by a substantial margin,” The Difference, Scott E. Page, University of Michigan. “The key to innovation, in economic terms, resides inside the heads of people, the more diverse the better. That link may not be immediately apparent, yet any understanding of innovation's role in economic growth must focus on diversity as well as ability.”

Number 2) There is a significant body of research that demonstrates the correlation between women in executive positions and higher profits and better overall performance. Agreed, correlation is not cause, but the correlation is significant. (Women Matter, McKinsey & Co.; The Bottom Line, Catalyst)

Number 3) The smartest people I know surround themselves with people who challenge their opinions, their premises, their conclusions – they invest in the intellectual journey and the debate. To get to this environment they tend to surround themselves with folks who bring a unique perspective, a unique experience, or a unique way of thinking about the problem –and they welcome these. OK, this one is not research, but I told you I used observation, too.

These are not my final thoughts on the topic by any measure. They are where I am today and what I am thinking about. I welcome your thoughts and observations on the matter and even invite you to guest blog about them on the Astia Notes Blog.


  1. Sharon, if I may, a voice from downunder. Research & my own experience have shown that a balanced team, one in which the genders are represented in similar proportion to the market, offers the best performance. Although, it is not just gender as, in some cases, women are participating as proxy men. Please, don't be outraged, I don't mean to insult but, it seems we all recognise that the Western World & business in general is still a largely masculine behavioural model. That said, many women have successfully achieved positions of influence by adopting masculine modes of behaviour because that was the only sensible option available to them. My point is that such diversions from their own nature can limit the ability of women to contribute even while the diversions are necessary to empower them with the opportunity to contribute. Messy isn't it?!?

    In angel groups we see the same thing, all too few women getting involved. In the USA that has led to Angel groups like the Golden Seeds & investment/entrepreneurial communities like ASTIA. These are important & valuable groups. The real success, in my opinion, will occur when most Angel groups enjoy a balance of genders comparable to the markets in which they operate.

    In Australia, we are seeing an increasing umber of female leaders in the entrepreneurial teams that present to Angel groups but, they are starting from a very low base & remain a small proportion. What is interesting to me is that I find inherent in the nature of person who joins an organised angel group is the type of intellect that is well disposed to recognising & addressing gender imbalance. I do not hear in angel groups careless, or thoughtless remarks about gender. Rather, since there is so much focus on backing the entrepreneur one is required to see each person for who they are & how they can leverage their inherent personal resources to drive success in & of their venture. A capable female entrepreneur has many points of differentiation to exploit to her advantage in the still masculine dominated behavioural environment of business. That, as you & your members already recognise, can be a very appealing investment proposition.

    These are big picture social challenges &, like climate change, they will take time to happen but, also like climate change, the urgency of action is immediate. We can no longer afford to sit back & think of gender & other forms of diversity as the feel good subject matter of MBA courses that can be blithely ignored in the “real world”. Our work places, like our families, dem& humanity & I remain astounded that throughout the developed world it is still commonplace for women to be paid less than their male counterparts for the same job!! As we learn to recognise the need for paternity leave businesses still treat women as high risk because they might leave work to have children!! Socialised role models continue to portray men as the leaders, women as the “mothers”. Every few weeks I meet another woman who has given up on a successful career in law, engineering, business, sales to become a counsellor, psychologist, or carer. No doubt there is some nature in those decisions but, it seems there is all too much nurture too.

    Sure, many women choose not to compete in the masculine behavioural model & that is fair enough. To those women who do choose to compete I beg you, help us move the model so that our entire communities can benefit now & into the future. A more balanced set of communal values holds out the hope of less conflict, fewer wars, less terrorism & more proactive, productive responses to urgent issues of climate change, water shortage, food shortage & peak resource consumption. Big issues, big challenges, big needs & that is why it should not be acceptable to any of us that only half the population bear the load & decide the path forward.

    Jordan Green
    Angel, Entrepreneur, Innovator, one-time VC
    ...from Australia

  2. Jordan,
    Thank you for this thoughtful comment and right on! to much of what you said. In particular, it is imperative that organizations like Astia function within what I call Business 2.0. Not women's networks. Not the old network where there were only men. But a network where men and women work together to grow businesses and win. And that is certainly what we are today. Men and women (entrepreneurs and Advisors and investors) enjoying a new way of doing business. Thank you again for your thoughts. Keep it coming.

  3. Jordan,
    Oops. I hit post before including that the diversity research shows that women need to be present in groups of three or more - or like you point out - they simply become like the men. It seems that true diversity requires true representation or participation. Astia Advisors are 45% men and 55% women. Our companies are obviously made up of men and women. Once again, thank you for the post.