Only two women made the 2011 Forbes Midas List of the top 100 venture capitalists, based on M&A and IPO exits. One of them is Deborah A. Farrington, founder and general partner of StarVest Partners, L.P. in New York. In a guest article for Business Insider, she expressed both her disappointment at seeing so few women in the upper echelons of venture capital jobs. And she offered some advice to help both women and anyone seeking a venture capital career.
First Farrington tackled why it’s important for more women to enter venture capital. Women are uniquely suited for growing more sustainable companies, due to their different leadership styles at the board level.
“My experience shows that women often evaluate business issues with a broader, top down perspective and lead by forging a consensus, two qualities that benefit the portfolio company. Women also contribute differently at the board level. They are oriented to providing meaningful assistance by mentoring and teaching others as partners, not preachers,” writes Farrington.
So how can more women break into venture capital?
First, get experience in an entrepreneurial environment. If you can’t snag an entry-level job or internship at a venture capital firm, then gain some experience at a related space, such as a VC-backed company, start-up firm, financial or tech position. There is no single path to a venture capital career. But any experience in the start-up world helps.
Farrington notes that there are more women who are founding or managing new eCommerce and social media firms today, which bodes well for a new generation of women venture capitalists.
Second, get prepared for your venture capital career with relevant experience. Experience counts, whether it’s learning how to analyze financial statements or business models, learning how to solve complex problems, or picking up technology-related experience. Business development and product management is a good background, too, she says. Deep experience in a sector can help venture capitalists understand the value of a new company or idea in a particular space.
Third, develop your network and find a mentor. Relationships are critical. Both men and women will benefit from establishing meaningful, strategic connections in the industry. This means reaching out and setting up plenty of informational interviews, and continuing this process even after you have a job.
Fourth, hone your risk-taking ability. Farrington says you must become good at making decisions based on limited or unknown information. Calculated risk-taking hinges on identifying, analyzing, and weighing the costs and benefits of a decision and having the courage to finally pull the trigger.
And finally, speak up and make yourself known. You need to get used to thinking through your ideas and expressing them in a clear, organized, influential way. You can’t be a shrinking violet and succeed in this industry.
What’s your opinion? Why do you think women are underrepresented in venture capital? And what could help more women succeed? Add your comments below.
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