November 3, 2020

Only 21% of tech unicorns are led by women, report shows

Companies with female leaders have more women in the staff overall, and they stay on longer.

Freya Pratty

3 min read

Just one in five leaders of tech unicorns are female, a new report shows, and those who do make it to the top tend to stay for significantly less time than their male counterparts.

The report by Notion Capital shows that just 21% of B2B unicorn tech companies across Europe and the US are led by women — meaning having women in any  'chief' roles, as founders or as VPs. Overall, women make up 34% of all staff in the companies. 

"There are so few female role models that it can be tricky to understand how to forge the path into leadership," says Maddy Cross from Notion Capital, the author of the report.
"There needs to be a discussion at leadership levels across global B2B tech unicorns about how to include women, and why it's important to include women, and part of this includes bringing in extended maternity leave policies."

Women hire more women

The more women that are in positions of leadership, the more women that there are across the staff in general. This was seen across the 20 companies analysed in depth in the report. 


This is similar to a trend in VCs highlighted last year, which showed that women were nearly three times more likely to invest in other women than men were to invest in women.

Women don't stay as long

The report found that female unicorn leaders don't tend to stay in companies as long as their male counterparts: women stay an average of 1.8 years and men an average of 2.7 years.

However, the more women there are in a company, the longer women stay in positions of leadership.

"If there's even one female CXO in the unicorn, the tenure of female leaders is 2.09 years in comparison to 1.32 years in unicorns with no female CXO,"  says Cross.

The way to the top

Notion's analysis also showed that female leaders are more likely to be promoted from within the company than men, who are more likely to come from another company into a leadership position.

This suggests, the report says, that the way for women to reach the top is to enter at a more junior level and work their way up to leadership, rather than moving horizontally across similar roles in different companies.


So, the more women in leadership positions in a company, then the more women across the staff overall, and the longer women stay on.

To start to improve the number of female leaders, companies need to see the money and time required to improve gender balance as an investment rather than a cost, Cross says.

The length of available fully-paid maternity leave within an organisation positively correlates with a larger number of female leaders staying for a longer period, as well as a larger number of female staff overall.

Out of all the companies analysed, payroll company Gusto performed "outstandingly well" on all measures of female inclusion, Cross says.
"I think it's no coincidence that their founder - Edward Kim - personally writes regular updates on their D&I strategy. Sending the message that inclusion matters from the top of the organisation, and investing money and time into fixing it, are — in my opinion — two great places to start."

Freya Pratty

Freya Pratty is a senior reporter at Sifted. She covers climate tech, writes our weekly Climate Tech newsletter and works on investigations. Follow her on X and LinkedIn