Leaders at Canadian Women in VC (CWVC) have long been interested in how the country’s venture capital (VC) industry has been retaining women. Realizing they had been sitting on a large, untapped well of membership data, they decided to take a closer look and share the results publicly.
CWVC analyzed the careers of more than 600 women in Canadian VC who have joined its ranks since 2019 to take the “pulse” of how women have advanced and been retained across the sector. The organization’s goal was to figure out whether women were staying in Canadian VC. Among other findings, its analysis indicates that nearly one in four members left the industry during this time.
“What funds can do is start to have honest conversations about their talent retention strategies.”
Emily Tiessen,
CWVC
In an interview with BetaKit, CWVC head of membership and community Emily Tiessen, who also works as a senior associate at Diagram, described this as “very surprising.” But it is tough to gauge its significance given the dearth of baseline information (such as overall rates of staff turnover) and comparable data (such as rates of women leaving VC in years prior to 2020). Tiessen and CWVC hope to help change that by producing analysis like this annually.
It also remains unclear why these women left.
“Was it a lack of growth opportunities?” Tiessen asked. “Was it a lack of work-life balance? Was it compensation-related? There are so many questions that we have, and so this is something too that we’re planning to dive deeper into and investigate.”
CWVC’s other priority, she added, is figuring out how to encourage VCs to retain more women.
Launched in 2018, CWVC is a volunteer-run, grassroots organization dedicated to supporting self-identifying women working in Canadian VC. It hosts events across Canada, provides upskilling resources, and produces annual reports on VC compensation.
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CWVC’s first member analysis determined that of the women who left the industry during this period, 39 percent joined or founded their own startup—“a natural path,” Tiessen noted. Another 20 percent stayed in finance (including private equity, traditional or investment banking), 15 percent transitioned to the public sector, 11 percent moved into consulting, and seven percent joined big tech companies.
As for the three quarters of its members who remained in VC, CWVC found that 16 percent of women received a promotion at their fund, approximately 10 percent switched to funds within Canada, and the remaining half remained in the same roles at the same VC firms.
Forty-six percent of promotions occurred at the manager, director, and principal level; while 34 percent were to senior analyst, associate, and senior associate roles. One finding Tiessen found particularly encouraging was that 20 percent of promotions advanced women to partner or executive-level roles. “That’s a really strong signal for us that there is a path to growth for women in the industry to this partner level,” she said.
RELATED: Lack of inclusion, unclear parental leave still hamper retention of women in Canadian VC
In recent years, many fund limited partners (LPs) have put pressure on the traditionally white- and male-dominated Canadian VC industry to hire more diverse candidates, and research indicates that this work has been paying off. But some have argued that LPs and the VCs they back have focused less of their efforts on inclusion, which could offer some insight into why funds have struggled to retain the women and people of colour they hire.
The past five years in Canadian VC have included both a boom in 2021 and an ongoing retraction ever since, during which many firms have struggled to raise funds, leading to some turnover across the industry. Tiessen thinks these conditions could negatively impact diversity in Canadian VC. “It’s more important than ever to retain that female talent,” she said.
While CWVC plans to investigate further, Tiessen hopes that in the meantime, this analysis spurs healthy discussions across the industry.
“For us, this is a strong signal of, ‘Okay, women are leaving the industry. Why?’” Tiessen said. “That’s what we want to figure out. But what funds can do is start to have honest conversations about their talent retention strategies, especially when it comes to women. Are there clear paths for advancement? Is there a parental leave policy in place? Is there equitable compensation? These are hard conversations for sure, but necessary in order to make sure the Canadian VC ecosystem remains diverse.”
Feature image courtesy Canadian Women in VC.