When a startup's leadership includes women and people of color, the entire organization, from top to bottom, is more diverse, according to new data released by Chicago Blend, a venture capitalist-led organization working to diversify Chicago’s tech ecosystem.
Chicago Blend, founded last year to examine the diversity gap in Chicago’s tech community, released data on Monday outlining the gender and racial demographics of local startups' leadership teams. The report, completed in partnership with the University of Chicago’s Polsky Center for Entrepreneurship and Innovation, includes anonymized data from more than 120 Chicago startups.
The startups included in the data were mainly chosen from the portfolios of 71 Chicago venture firms, such as 7Wire Ventures, Clean Energy Trust and M25.
The data shows that among startup board seats, 9.8 percent are held by women and 10.2 percent are held by people of color. And among executive-level roles at startup companies, 81 percent are held by men and 85 percent are white.
To show the value that a diverse leadership team can have on an entire company or organization, Chicago Blend looked at how leaders' gender and race impacted diversity throughout.
The data shows that among startups with women CEOs, half of their staff is female, compared to male CEOs, whose staffs are only 28 percent women. Additionally, women CEOs often correlate with a greater representation of women on their company's board. Among companies with female CEOs, 32 percent of their board seats are occupied by women, while only 5 percent are occupied by females at companies with male CEOs
Similarly, when people of color are CEOs of startups, nearly 30 percent of their employees identify as racial minorities, compared to 20 percent in companies with white CEOs. There is also a greater representation of people of color among board members at companies with minority CEOs.
“Companies with a more diverse team at the top have more diverse teams throughout,” said Lindsay Knight, the founder and a board member of Chicago Blend and the director of platform at Chicago Ventures. “A top-down approach is so important in influencing decision-making trickling down to the rest of the organization.”
To address the lack of diversity at the board level, Chicago Blend has created “The BlendList,” a roster of women and black, Hispanic, Latinx and Asian board candidates in Chicago and around the country.
“The idea is [to] create some transparency and eliminate the 'pipeline excuse problem' that we always hear,” Knight said. “Let’s focus specifically on folks at the executive level, who would be great, independent board members.”
Chicago Blend is currently taking nominations for the list. So far, it includes local techies like Jellyvision CEO Amanda Lannert, 4Degrees founder and CEO Ablorde Ashigbi and Farmer’s Fridge CTO Candice Savino. The list identifies each person's current role, their past experience and business expertise.
Modeled after a similar program in New York called NYC Blend, Chicago Blend's initial data released last year shows that among 348 employees at 70 Chicago-based VC firms, 75 percent were male and 86 percent were white.
On Monday, Chicago Blend also announced that it is partnering with local startup The Mom Project, Women Who Code and San Francisco-based recruitment software startup Entolo, all of which focus on supporting diverse job candidates.
“We want to be an organization that is executing and helping companies to make change and not just talking about it,” Knight said. “We want to keep that urgency and momentum going.”
