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Investors prefer pitches presented by male entrepreneurs compared with pitches made by female entrepreneurs, even when the content of the pitch is the same; attractive males were particularly persuasive, whereas physical attractiveness did not matter among female entrepreneurs.
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- Alison Wood Brooks - Harvard Business School
- Laura Huang - Wharton School, University of Pennsylvania
- Sarah Wood Kearney - MIT Sloan
- Fiona E. Murray - MIT Sloan
Entrepreneurship is a central path to job creation, economic growth, and prosperity. In the earliest stages of start-up business creation, the matching of entrepreneurial ventures to investors is critically important. The entrepreneur’s business proposition and previous experience are regarded as the main criteria for investment decisions. Our research, however, documents other critical criteria that investors use to make these decisions: the gender and physical attractiveness of the entrepreneurs themselves. Across a field setting (three entrepreneurial pitch competitions in the United States) and two experiments, we identify a profound and consistent gender gap in entrepreneur persuasiveness. Investors prefer pitches presented by male entrepreneurs compared with pitches made by female entrepreneurs, even when the content of the pitch is the same. This effect is moderated by male physical attractiveness: attractive males were particularly persuasive, whereas physical attractiveness did not matter among female entrepreneurs.
Status Beliefs and the Spirit of Capitalism: Accounting for Gender Biases in Entrepreneurship and Innovation
Gender status beliefs disadvantage typical women entrepreneurs vis-à-vis their male counterparts, but innovation in a business model has a stronger and more positive impact on ratings of women’s entrepreneurial ability and overall support for their business ideas than it does for men’s.
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- Sarah Thébaud - University of California–Santa Barbara
In this article, I develop and empirically test the theoretical argument that widely shared cultural beliefs about men’s and women’s abilities in entrepreneurship (i.e., “gender status beliefs”) systematically influence the social interactions during which an entrepreneur, particularly an innovative entrepreneur, seeks support from potential stakeholders for his or her new organization. To evaluate this argument, I conducted three experimental studies in the United Kingdom and the United States in which student participants were asked to evaluate the pro les of two entrepreneurs and to make investment decisions for each. The studies manipulated the gender of the entrepreneur and the innovativeness of the business plan. The main finding is consistent across studies: gender status beliefs disadvantage typical women entrepreneurs vis-à-vis their male counterparts, but innovation in a business model has a stronger and more positive impact on ratings of women’s entrepreneurial ability and overall support for their business ideas than it does for men’s. However, the strength of these patterns varies significantly depending on the societal and industry context of the new venture in question. Findings indicate that gender status beliefs can be understood as an important “demand-side” mechanism contributing to gender inequality in aggregate entrepreneurship rates and a micro-level factor affecting the likelihood that a new and novel organization will emerge and survive.
African-American fundraisers on Kickstarter achieve significantly lower success than other groups.
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- Lauren Rhue - Wake Forest University School of Business
Crowdfunding platforms like Kickstarter are expected to “democratize” funding by increasing the availability of capital to traditionally underrepresented groups, but there is conflicting evidence about racial disparities in success rates. This paper contributes to the information systems literature on crowdfunding by examining the racial dynamics in the crowdfunding platform Kickstarter. The race of subjects in project and user photos are determined with facial recognition software for 138,778 fundraising projects, and matched sample techniques are used to control for observable differences in project categories among racial groups. Even controlling for these observable differences, this study finds that projects with African-American photo subjects achieve lower success rates. African-American fundraisers also achieve significantly lower success than other groups, and this effect is larger than the effect from project photos. This study has practical implications for individuals seeking capital in these markets as well as design implications for the platforms themselves.
Crowdfunding may reduce gender inequalities in the fundraising arena by benefitting the communication style of women.
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- Andreea Gorbatai - Haas School of Business UC Berkeley
- Laura Nelson - Kellogg School of Management Northwestern University
In this study, we set out to examine the role of language in the success of online fundraising—a new form of entrepreneurial project financing. In particular, we evaluate the influence of linguistic content on fundraising outcomes, above and beyond type of product or service offered. Online fundraising settings pose an interesting empirical puzzle: women are systematically more successful than men, an outcome contrary to offline gender inequality. We propose that this outcome is partially explained by linguistic differences between men and women in terms of language they use, and we test this mechanism using data from the online crowdfunding platform Indiegogo. The results support our theory, suggesting a link between micro-level linguistic choices and macro level outcomes: the institution of crowdfunding may reduce gender inequalities in the fundraising arena by benefitting the communication style of women.
Gender and Venture Capital Decision-Making: The Effects of Technical Background and Social Capital on Entrepreneurial Evaluations
The gender of the entrepreneur influences evaluations most when the person, rather than the venture, is the target of evaluation. Technical background qualifications moderate the influence of gendered expectations, and women receive more of a payoff than men from having a close contact to the evaluating VC.
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- Justine E. Tinkler - University of Georgia
- Manwai C. Ku - Stanford University
- Kjersten Bunker Whittington - Reed College
- Andrea Rees Davies - Stanford University
Research on gender and workplace decision-making tends to address either supply-side disparities between men’s and women’s human and social capital, or demand-side differences in the status expectations of women and men workers. In addition, this work often relies on causal inferences drawn from empirical data collected on worker characteristics and their workplace outcomes. In this study, we demonstrate how tangible education and work history credentials - typically associated with supply-side characteristics - work in tandem with cultural beliefs about gender to influence the evaluative process that underlies venture capital decisions made in high-growth, high-tech entrepreneurship. Using an experimental design, we simulate funding decisions by venture capitalists (VCs) for men and women entrepreneurs that differ in technical background and the presence of important social ties. We demonstrate the presence of two distinct aspects of VCs’ evaluation: that of the venture and that of the entrepreneur, and find that the gender of the entrepreneur influences evaluations most when the person, rather than the venture, is the target of evaluation. Technical background qualifications moderate the influence of gendered expectations, and women receive more of a payoff than men from having a close contact to the evaluating VC. We discuss the implications for future research on gender and work.
Gender, ethnicity and entrepreneurship in initial public offerings: illustrations from an open database
A range of statistics relating to the gender and nationality of the top management teams (TMTs) and board of directors (BoDs) of all emerging growth firms (EGF) that made an initial stock offering (IPO) on US public markets from 1990 through 2010.
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- Martin Kenney - University of California, Davis
- Donald Patton - University of California, Davis
This paper describes the variables in a freely available database of all emerging growth firms (EGF) that made an initial stock offering (IPO) on US public markets from 1990 through 2010. Our expectation is that researchers from a variety of disciplines can use this data to answer a wide variety of social science questions and combine it with other databases. To illustrate how the data can be used, we describe the gender and nationality of the top management teams (TMTs) and board of directors (BoDs) of these firms. We confirm that women are under-represented in all functional positions, but, in contrast to much of the popular press, we find that statistically Silicon Valley firms perform better than the national average. Gender ratios differ by function with women most prevalent at the CFO position and are most prevalent in the biomedical industry. Using undergraduate education, as an identifier for nationality, we find that, contrary to the popular press, there are more European than Asian immigrants in the TMTs. This suggests that European immigrants are more likely to immigrate with advanced degrees, while the Asian immigrants have only Bachelor’s degrees. In the immigration literature, it has been observed that specific immigrant groups concentrate in particular occupations. To test for this effect, we study the backgrounds of all identifiable Taiwanese immigrants. A remarkably high concentration of Taiwanese TMT members were from two Taiwanese universities’ electrical engineering departments, then received U.S. graduate degrees, particularly from UC Berkeley, and entered semiconductor-related industries. This database will contribute to reproducible social science as the same quality-controlled data is now available to all researchers.
Technology incubation is presented as a legitimating induction process encouraging women to reproduce masculinised representations of the normative technology entrepreneur
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- Susan Marlow - University of Nottingham
- Maura McAdam - University of Nottingham
Whilst there is a substantial body of literature which seeks to establish, or dispute, the beneficial influence of business incubation, this debate remains almost entirely gender blind. This article challenges this assumption by adopting a feminist perspective to reveal business incubation to be a gendered process which shapes the identity work undertaken by women seeking legitimacy as technology venturers. In so doing, we critically evaluate prevailing normative analyses of the business incubation process and entrepreneurial legitimation. To illustrate this argument, we draw upon empirical evidence which reveals technology incubation as a legitimating induction process encouraging women to reproduce masculinised representations of the normative technology entrepreneur.
During business networking conferences taking place among Turkish business people in Silicon Valley, women and older males became marginalized through the emergence of a hegemonic masculinity associated with young Turkish male entrepreneurs.
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- Banu Ozkazanc-Pan - University of Massachusetts, Boston
Purpose – The purpose of this paper is to examine identity formation and networking practices relevant for high-technology entrepreneuring or the enactment of entrepreneurship in Silicon Valley by Turkish business people. Design/methodology/approach – Guided by postcolonial feminist frameworks, the author conducted a combination of ethnographic and auto-ethnographic fieldwork at high-technology conferences in Silicon Valley by focussing on talk and text as relevant for understanding entrepreneuring. Through a reflexive stance, the author analyzed observations, conversations, and experiences inclusive of her own positionality during the research process as they related to entrepreneurial identity formation and networking. Findings – During business networking conferences taking place among Turkish business people in Silicon Valley, women and older males became marginalized through the emergence of a hegemonic masculinity associated with young Turkish male entrepreneurs. In addition, local context impacted whether and how actors engaged in practices that produced marginalization and resistance simultaneously. Originality/value – The research is of value for scholars interested in understanding how identity formation and networking in high-technology entrepreneuring take place through gendered practices and ideas. Scholars interested in deploying postcolonial feminist perspectives will also benefit by understanding how key analytic tools and research methods from these lenses can be used for conducting fieldwork in other contexts.
Does Social Proximity Enhance Business Partnerships? Theory and Evidence from Ethnicity's Role in U.S. Venture Capital
U.S. venture capitalists (VCs) are more likely to select start-ups with coethnic executives for investment, particularly when the probability of the start-up’s success appears low.
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- Deepak Hegde - New York University
- Justin Tumlinson - University of Munich
We develop a formal model to understand the selection and influence effects of social proximity (homophily) between business partners. Consistent with the model’s predictions, we find that U.S. venture capitalists (VCs) are more likely to select start-ups with coethnic executives for investment, particularly when the probability of the start-up’s success appears low. Ethnic proximity between VCs and the start-ups they invest in is positively related to performance, measured by the probability of the companies’ successful exit through acquisitions and initial public offerings (IPOs) and net income after IPO. Two-stage regression estimates suggest that these positive performance outcomes are largely due to influence, that is, superior communication and coordination between coethnic VCs and start-up executives after the investment. To the extent that VCs expect to work better with coethnic start-ups, they invest in coethnic ventures that are of lower observable quality than noncoethnic ventures.