It's Rarely Women Who Are Taking Companies Public

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It's not the boardrooms of old-fogey Fortune 500 companies that are dominated by dudes!


Sheila Lirio Marcelo took her company (a platform for finding babysitters and other caregivers) public on Friday. But, as the Wall Street Journal points out, hers is quite a rare story. Between 1996 and 2013, just 3 percent of companies that did an IPO were led by women CEOs. In 2013, 82 companies went public, but only two had female CEOs.

That's according to the research of Martin Kenney (a sociologist) and Donald Patton (an economist) at UC Davis. And there are probably many, many contributing factors at work here. The study excluded "blank-check shell companies, real-estate investment trusts, companies founded more than 30 years ago, and spinoffs of larger companies."

That left a lot of fast-growing companies, many of them in tech, backed by venture capitalists who are (as Kenney pointed out) overwhelmingly men. The WSJ cites a 2011 survey saying women are just 11 percent of investors.

"It's not necessarily that there's some sort of discrimination, but rather structural factors," Kenney told the Journal. But they're not mutually exclusive—the kind of "pattern matching" that assumes a successful CEO will look like either Mark Zuckerberg (for a fast-and-loose startup) or Jack Welch (for anything more buttoned-up) is its own kind of discrimination, even if it's unconscious.

It is also a pipeline issue—it's not like there are equal numbers of women running startups to begin with. But the Journal references a pretty damning forthcoming paper on the matter:

Researchers at the University of Utah's David Eccles School of Business presented M.B.A. students with public-offering prospectuses of the same company, but changed the gender of the CEO.

The students were four times as likely to recommend an investment in a company with a male CEO. The paper is to be published in a coming issue of the Journal of Management.

During the long road to an IPO, "a series of unconscious biases kills it for some women," says Lyda Bigelow, lead author of the study.



(h/t ThinkProgress)

Image via Getty



I'm eager to read the paper (and still have to read the article, so I apologize if this comment is moot), but I would like to see a study where all executive gender information was removed, students them selected which companies to invest in, and then gender was added and slight changes made to the corporate profiles (industry sub-sector, gross profit margin by a percent or two, incremental change in forecasted market growth, etc.), if the outcome is any different.

Also, apologies if this makes no sense, I still need coffee! :)