What It Will Take To Get More Women At The Agtech Table
Where are the women at the table? In recent years, the agtech sector has been growing by leaps and bounds, in part driven by growing attention placed on food access during the pandemic. Case in point, 2021 is another record year for venture capital investments in agtech, according to CropLife. As of mid-2021, some $4.3 billion was invested in the sector in 263 deals compared to $5.15 billion in 2020. Anecdotally, there appears to be more women founders and leaders in what is still considered a young sector.
Within the vast landscape of agtech companies (many of which are startups defined by the stage of funding they have achieved), the gender ratio on boards remains male dominant. While to date there is no comprehensive dataset that confirms numbers, in our self-analysis we took a sample of companies in agtech curated from top searches for prominent agtech companies and examined gender ratio on boards. Our review of 16 companies with public information regarding its leadership shows that 24% of leadership positions are held by women and only 3.6% are held by women of color.
While one might assume that companies founded by women would have a healthy balance of men and women on their boards, the reality is quite the opposite. A sampling of companies profiled in my new book, From Farms to Incubators: Women Innovators Revolutionizing How Our Food is Grown (in which most of the companies were founded by women), points to a dearth of women at the table. The sample was taken by going to the companies’ websites and reviewing the board members listed.
Already women are a minority when it comes to company boards across all sectors. Bloomberg reported in May that more than 1 in 10 of the 3,000 companies listed on the New York Stock Exchange have no female directors. While this disparity isn’t a surprise, it begs a deeper dive into the factors behind the gap.
There is already a scarcity of women investors in venture capital, a funding oasis for startups. In 2020, women made up 5% of venture capitalists, a 1% increase from the previous year. The number of VCs that focus on agriculture and agtech is a sliver of the whole pie, fueled by a relatively new sector and the fact that agriculture driven by the growing season has a longer return on investment. Venture firms run by women that focus on agtech are a minority. Sarah Nolet was inspired to cofound Tenacious Ventures, an agtech investment firm based in Australia, partially because of the lack of female investors. The Tenacious investment team is led by women.
“There are a lot fewer venture capitalists that are female, and one way that you end up on high tech startup boards is because you are an investor and that’s how you get a board seat,” says Nolet, who is also the founder of AgThentic, an agtech consulting firm. “There are just fewer female investors and investing in a company is a common way to get on a board.”
The imbalance often comes down to what the industry and those in the industry are accustomed to. In examining private agrifoodtech companies, there is a bias in board recruitment. “Often it is men founders and investors whose networks are men, so that is who they invite,” says Vonnie Estes, who has sat on six boards, two representing the investor and four as an independent. “They don’t make the effort to look outside the network they have built through university and careers to find women outside their group.”
Board members are overwhelmingly people in their mid- to late careers and tend to be middle-aged white men. The lack of women on boards is also due to the fact that many agtech companies are “early-stage and the industry is still relatively immature so there are relatively fewer later stage companies that could do things like pay director fees,” Nolet says, noting that the directors are working for equity as opposed to being paid in cash.
Early-stage startups are not necessarily focused on boards and are more focused on customer research and financing, says Dennis Donohue, the executive director of the Western Growers Center for Innovation and Technology (WGCIT), a business incubator for agtech startups, based in Salinas, Calif. A clear demarcation needs to be made between publicly traded companies and startups, he notes. “Board development is not a major focus as I see, and if it is, it’s mostly for the purpose of financial access or market access,” Donohue says. When it comes to gender disparity on boards Donohue says he doesn’t see it when it comes to the startups that he has worked with.
Donohue continues, “My general observation is there are no glass ceilings per say that I see or that I encounter. I think people as a rule are very focused on getting financed, how to get financed, who will finance them and what they are trying to accomplish.”
This post was originally published on Worth.com.