Venture capital is overwhelmingly white and male

20 Dec Venture capital is overwhelmingly white and male

SAN FRANCISCO — Venture capital, the tech industry’s most exclusive club, is overwhelmingly white and male.

A new report says it doesn’t have to stay that way.

The first comprehensive look at the demographics of venture capital from its own trade association is a sobering snapshot of what decades of exclusion of women and minorities have wrought.

Women, African Americans and Latinos are significantly underrepresented in venture capital, with few holding decision-making positions, according to the report to be released Thursday by the National Venture Capital Association and Deloitte University Leadership Center for Inclusion.

Women make up 45% of the venture capital work force, mostly in administrative roles, but just 11% of investment partners, or the equivalent, on venture investment teams.

African Americans make up 3% and Latinos 4% of the venture capital workforce. None of the 217 firms with more than 2,500 employees had an African-American investment partner.

That stark lack of diversity was already evident to anyone who perused the web sites of venture firms or took a stroll through their upscale offices on Silicon Valley’s Sand Hill Road.

But the data gathered in the survey will serve as a critical benchmark by which to measure progress in bringing more women and minorities into the field, says Kate Mitchell of Scale Venture Partners who co-chairs the diversity task force of the National Venture Capital Association.

Something else in the data offers a glimmer of hope that could persuade more venture firms to focus on diversity initiatives, she says. According to the survey, there’s a direct link between outreach efforts and greater diversity. Venture capital firms with diversity and inclusion strategies had a significantly greater share of women and minorities in leadership.

“We are not surprised by the data by any stretch of the imagination,” Mitchell said. “But we got some data out of it that gives us a great sense of where we need to focus.”