One morning at SxSW, Jody Greene moderated a panel with three bay area powerhouse women, Trish Costello, founder of Portfolia, Theresia Gouw, founder of Aspect Ventures and Fran Maier, founder/chair of TRUSTe. Each having been previous entrepreneurs, now investors and board members of public companies. The conversation was multifaceted on the topic from the viewpoint of board members and entrepreneurs.
The discussion started off asking why the number of women on public boards was so low – around 18% (or lower) – Gouw stated that this is typically because when there are open spots on boards, the typically all-male board members reach out to their own networks and it propagates adding more men to boards.
Gouw says she’s seeing all-male founding teams are building products and know their customers are mostly women (85% of all consumer spending is done by women) and these teams are starting to recognize that they need to get some women involved so they can better relate to their customers. She also states that it’s much more effective if there are at least two women on a board and she advocates for adding more women to the boards she sits on.
Maier flipped the research on its head by posing the question: “Why do we have to say ‘having 20% of women on boards shows a positive result for companies instead of ‘having 80% of men on boards shows a negative result for companies?’” Maier points out that we shouldn’t have to prove women are needed on boards and looks forward to when women don’t have to use research to prove their worth in the boardroom.
When asked how women can get involved in a board, Costello thinks the best way to get women on boards is to encourage them to start investing. Becoming an investor is the fastest way to obtain a board seat of a company – if you write a check, ask for a board seat (whether to a for profit or not for profit organization). Gouw also adds that joining an advisory board is a great way to get in the pipeline to get involved as well.
Gouw also mentions there can be an assumption that you are “too busy” with your own company, life, kids, etc. to join a board, so it’s imperative to raise your hand and ask for board seat opportunities. She states that “it’s hard to do, but really important to go after the opportunity and let your network know you are looking to get involved.” Getting on a non-profit board is a great way to gain experience and connections, finding a cause you are passionate about and using the skill set you have to further the mission of the organization and establish a track record of being a leader.
Gouw talked about the time and workload that comes with a board member. “If you are working with a startup – you can bet that you’ll be meeting more often, asked for more help, connections, etc. Over time, once things get settled, tactical responsibilities will diminish and higher-level strategic help will be needed. Committees will then be created and strategic thinking will be expected.”
As the conversation progressed, it moved into discussing how and when entrepreneurs should start looking for board members and how to set it up. Costello mentions that “board members in early stage startups don’t get monetary compensated but are usually given an equity stake – so it’s important to know that if you join a startup board, you won’t be receiving a check.” Gouw says that “typically public and major private companies give board members an equity stake equal to a VP, but with a shorter vesting period.” Maier reminds us all that being on a board is a big responsibility and that it’s really important to take it seriously, especially for startups because the impact for the company is huge.
As an entrepreneur, all panelists agree starting with an advisory board is the best place to start when you think you need to create a board. Gouw says to look to people in your industry who you admire and have a great track record. Forming a board is a big benefit for entrepreneurs and helps to get that strategic direction.
Costello says she wishes that influential bloggers and women with strong skill sets like marketing or social would get involved in advising companies because they are able to expand the reach of a company far better than an advertising budget. She’d like to see more women raise their hands and join more boards. Here here!!
Stephanie Burns is the founder and CEO of Chic CEO. You can follow her on Twitter at @StephanieABurns or Chic CEO at @ChicCEO.
Source: Forbes