INSUBCONTINENT EXCLUSIVE:
Even bigger than the salary gap that sees women earn $.82 on the dollar is the equity gap
A new study from Carta and the ex-Twitter female investor group #Angels reveals that women make up 35 percent of startup equity-holding
employees, yet own just 20 percent of the equity
That means they own just $0.47 for every $1 that men own
Even worse, women account for 13 percent of startup founders but just 6 percent of founder equity — or merely $0.39 on the
dollar.Combined, that means only 9 percent of founder and employee startup equity is owned by women.&This is not just about wealth& says
&Wealth from successful exits goes on to shape the entire industry
It about who has power and who gets to decide what gets funded.& #Angels& JessicaVerrilli notes that &Having this data is going to be a
watershed moment and catalyze more urgency to address this underrepresentation.&#Angels& Chloe SladdenThe study by cap table management tool
Carta (formerly eShares) looked at a subset of its privately held company customers including roughly 180,000 employees, 15,000 founders,
and 6,000 companies encompassing $45 billion in equity value.Amongst the hypothesized causes of the gap are that female-led startups get
valued lower and diluted more, there less total capital allocated to women due to investor and industry bias, the underrepresentation of
women as investors, challenges facing women during negotiations, and that they often team-up with more co-founders that have to split the
equity pool.#Angels& Jana Messerschmidt explains that the gap table spotlights how women aren&t being hired for early engineering and
These roles often get the lion share of equity, and when women are hired for sales, marketing, and HR jobs, &thosefolks are getting less
equity because they are joining later and we have a hypothesis of how those roles are valued differently.& Sladden reminds founders to focus
on diversity from day one
&Don&t push this off as something you&ll fix down the road as you&re facing all the other challenges.&Once a successful startup gets
acquired or IPOs and paper money turns into cash, tech workers often reinvest their winnings into more startups as angels, fund LPs, or by
starting their own venture firm
If only men are getting enough equity to make those downstream investments, their biases could further unbalance the gender breakdown of the
The #Angels say they&ve found this translates into fewer fundraising term sheets and bargaining power for female founders when they come to
the Sand Hill Road boy club for venture capital.Beyond more diverse hiring, the #Angels believe it critical that the industry demystify
equity so more women know how to exercise stock options and score tax advantages for maximum gain
&You shouldn&t need to have an MBA to know the importance of equity and how to negotiate for it& says Sladden
Better financing avenues for those women who need up-front capital to exercise their stock options could also ensure it not just those who
already have money who can make money through equity.Sladden concludes, &We hope this is going to start a movement
We hope that CEOs will start to measure it and talk about it.&
