Jessica Areborn, Sales Director, and Pernilla Alexandersson, Founder and CEO, leverage their diversity expertise through their work with Swedish consultancy firm Add Gender. Add Gender works to make the business sector and workplaces more sustainable from a gender balance and equity perspective. Add Gender provides training, analysis and advisory services to client companies to promote gender equality and diversity.
As an expert on diversity and project management, Areborn works with Alexandersson, an expert in strategic gender equality work and innovation, to maximize returns for companies through the promotion of gender parity practices.
Christopher P Skroupa: What knowledge is missing amongst investors to work towards gender equality? What has to change in the investor industry?
Jessica Areborn: I think the key word here is knowledge. If you want to improve your investment performance, you need to understand the aspects of gender and norms that influence and shape us in the decisions we make—that influence all of us, regardless of gender, color or religion.
Pernilla Alexandersson: Yes, you need to understand both how you, yourself, make decisions, as well as the people coming to you for ideas and how they have been formed through norms and expectations and how they express them.
Areborn: As the old saying goes, you can’t expect different results when doing the same thing. What has to change are the ideas around how women’s and men’s areas are defined and valued. We need to think bigger about entrepreneurships and their value in terms of monetary and societal returns.
Alexandersson: From what we see and understand working at Add Gender with various clients seeking to master gender equality in business, men are not only a dominant force in the venture capital firms, but their networks seem to consist mainly of men. The process needs to change.
How can the investment process be streamlined to eliminate unconscious bias as effectively as possible? Let me also be clear that this is nothing that women are exempt from—it’s a question of rigid norms and old structures.
Areborn: Everyone will make a decision based on what they know or how they identify themselves (also known as “mini-me syndrome”), but if the group is homogenous, their decisions will be as well. However, if a company or organization adopts a process that has mitigated bias and gut feeling as much as possible, then there will be greater success in reducing skewed outcomes.
Skroupa: What are the common myths regarding women’s and men’s entrepreneurship that reinforce gender inequality?
Alexandersson: There are many myths that we like to repeat to ourselves—myths around what a start-up is, or what an entrepreneur looks like. One perpetuating myth is that there are no women entrepreneurs, or that that they don’t want to grow or ask for as much invested capital as their male counterparts.
Areborn: Investors, regardless if they are women or men, don’t see that companies by women have the same growth potential or willingness for growth, and thus, they perceive the company as less appealing to invest in. Alternatively, they’re given less capital which, in turn, makes it more difficult to stimulate company growth or employ additional human capital. The upside can sometimes be, however, that they make a profit faster.
Alexandersson: A study by the Swedish Agency for Economic and Regional Growth also found that women and men send the same signals in their written communications when seeking investments in how they express themselves regarding innovation and proactivity, but women are valued less based on their gender over their idea generation.
Yet, when we look at some key indicators (turnover, growth, solidity, etc.), there are no differences between the two. To summarize, I think we can say that the main myth is that we consider business ideas differently based on our own expectations of how women and men should behave.
Skroupa: How are entrepreneurship and business ideas valued? Do people evaluate ideas differently between women and men?
Alexandersson: Well, as humans, categorizing helps us make decisions faster and more efficiently, but on the other hand, it reinforces stereotype creation. If we’re not careful, we start to create our own reality around our own perceived truths. In an industry based on predictions about the future, it is crucial that we keep our minds clear from disruptive gender stereotypes particularly when making decisions on investments.
Areborn: Stereotypes arise when there is a lack of role models. We are all dependent on seeing ourselves or being inspired when taking risks and pursuing new ideas—if you can see it, you can be it. Without a more diverse range of role models, the idea that there is a certain type of person more suited to being an entrepreneur or has the best idea and is worth investing in is kept alive, even though there is no reflection in reality.
Alexandersson: Evidence shows that women and men starting a business are perceived differently. Men are considered to be in industries with growth potential—the right industry— whereas women looking for investments are considered to be in the wrong industry without growth potential. This can even be the case if it’s the same industry.
Areborn: The study by the Swedish Agency for Economic and Regional Growth also found that women and men were referred to differently. Women are described with 54% negative attributes, whereas men are described with a majority of positive attributes at 86%.
The same attributes are valued differently depending on whether they describe a woman or a man. This is something that, again, comes down to structures and expectations that both women and men investors will project on entrepreneurs seeking investments.
Alexandersson: Certain attributes that are considered negative for women, such as expressing caution, are considered positive for entrepreneurs that are a man. The study concluded that if a man is considered “young and promising,” women are considered “young but inexperienced.” This is something that we need to recognize as a real problem and provide solutions to before the consequences of inequality gets way too serious.
Skroupa: Can you give any tips for what to do to be more inclusive, encouraging gender equality and minimizing unconscious bias?
Alexandersson: As an investor—and human being—the best start is raising awareness of what stereotypes and common ideas surrounding women and men exist, and how they can skew investor perception when seeking capital. If you know of these stereotypes, it is easier to be aware of them and try and avoid them.
Areborn: You should also ask yourself how you value competence and experience. We often hear people say that they only go by competence, but what does competence really mean? What values and ideas have been assigned to that word? That will influence your decision.
Develop gender aggregated statistics to get an understanding of who gets what, and to what extent based on gender. What gets measured gets done.
Alexandersson: Also, look over the questions you ask the entrepreneur from an investor perspective—are they the same? Do you give women and men the same time in meetings and interviews?
Areborn: Try and make the process as streamlined as possible to ensure all entrepreneurs get treated the same way to better eliminate personal preferences or unconscious bias. What do you do to ensure you understand the industries and markets of women and men to a similar extent?
Alexandersson: You need to know that even with the best intentions, you are only human. Try and eliminate any personal bias if possible by going asking yourself whether you’re acting cognizantly or operating off of a gut feeling.