Yahoo Finance VC Eileen Burbidge on why startups should prioritise diversity
There’s a significant gender gap when it comes to the types of startups that receive funding.
For every £1 in UK venture capital investment, all-female-founded teams receive less than 1p, according to a government-commissioned report released earlier this year, which was conducted by British Business Bank, Diversity VC and the British Venture Capital Association.
While the stats on venture funding haven’t changed much over the last couple of years, VC Eileen Burbidge, a partner at London-based venture firm Passion Capital, believes there has been a “step change” in awareness and dialogue around diversity issues over the past decade.
“You wouldn’t have had the level of conversation that we’re having now,” said Burbidge on Yahoo Finance UK’s video series Global Change Agents with Lianna Brinded. The new show delves into the stories of pioneering women across business, finance, technology, and academia.
Watch the full Eileen Burbidge interview here
“You wouldn’t have had either government-backed or private sector-backed initiatives to try and see more representation in boardrooms, in decision making, in fund management, in the past,” said Burbidge.
“You wouldn’t have started to see the measurement about fund returns related to gender; you wouldn’t have started to see some of the people taking on studies and trying to get data about correlation and about performance,” she continued. “I think that’s all been extremely important because I think that’s what we need to continue doing in order to start to shift this trend.”
If those types of diversity conversations were brought up 10 years ago, Burbidge said, there were times when “people might roll their eyes or cringe, or people thought, ‘oh we’re just doing this because we have to,’ or it’s a check-off item.”
Now the conversation is genuine because people understand the “material difference it makes to commercial viability and success if there is diversity on the team and diversity of thought in decision making,” she said.
Still, Burbidge said more work needs to be done at an early stage to encourage girls to pursue the types of subjects at school and university that could lead to them becoming the next generation of entrepreneurs.
‘Bake in diversity from the very beginning’
As an early-stage investment fund, Passion Capital usually gets involved with companies when they only have anywhere between two and 10 employees. Burbidge said this is a crucial time to open up conversations around diversity.
“You have to have the conversation — the earlier on the better — to start to bake in diversity from the very beginning,” said Burbidge.
“If you get to the point where you have a team of 30 or 40 people and you are all one homogenous group of people — whatever that demographic group of people, whatever that attribute is — it’s going to be really difficult to bring in diversity at the point.”
For example, Burbidge said, potential candidates could be put off if they visit an office for their job interview only to be greeted by a room of people they are unable to relate to.
Burbidge also believes more people need to speak up about issues such as unconscious bias in order to shift the unbalanced diversity figures in the startup space.
“I think that a lot of people who speak about diversity and inclusion don’t just want to be that person that talks about diversity and inclusion,” Burbidge said. “But if we don’t have anybody talking about it, it’s a problem … I think we have to keep, keep, keep talking about it and keep it in the conversation.”
Global Change Agents with Lianna Brinded is a new premium video series from Yahoo Finance UK. The show explores the stories of some of the most inspirational women across business, tech, and academia. Catch up on all the latest episodes here.
