In the last nine months, something unusual has happened at our investment firm: We hired three women as CEOs to run companies in our portfolio.
Last summer, we tapped Dede Wakefield to run Alogent*, our new financial-technology company in Atlanta. Separately, we named Amy Stelling the CEO of Enviance*, an environmental-software company in southern California. Both are first-time CEOs. Finally, in October, we helped recruit and hire longtime healthcare executive Nancy Ham to take the helm at our medical-software company WebPT.*
We wish having this many women in CEO jobs wasn’t out-of-the-ordinary. And, in truth, hiring women for these roles was not an explicit goal for us; we were simply looking for the best people to fill these positions and help scale these companies.
But looking back now, we think this cluster of female-CEO announcements highlights an important insight about diversity in the C-suite, particularly in the technology world: Namely, that you can’t appoint more female CEOs if you don’t have a bunch of them in your network already.
It may seem obvious. But we think many investment firms, recruiters and board directors don’t focus enough on this as a part of their day-to-day work—and as a result, they find themselves looking at un-diverse slates of candidates when they suddenly have to fill CEO positions. Or, they wind up going back again and again to the same, small pool of women candidates, a dynamic the New York Times recently wrote about in terms of companies tapping the same (tiny) group of women for tech-company board positions.
In all three of our recent CEO appointments—at Alogent, Enviance and WebPT—we had extensive, previous history with the incoming female executives, and kept track of them once we met them, sometimes over decades.
Russ, a longtime software-industry CEO, first met Dede over 20 years ago when they were colleagues in the finance organization for Dun & Bradstreet Software in Atlanta. Dede had just started her career there as a financial analyst, and Russ was the director of planning and analysis for the company’s largest business unit. He was impressed with her analytical skills and business acumen. Russ stayed in touch with Dede, even after both of them left the company, tracking her career as she moved through increasingly senior jobs at companies including CheckFree, Fiserv, Global Payments and GT Nexus, where she was the CFO. Along the way, Dede accumulated extensive experience in banking technology—which ultimately made her a great candidate for the Alogent CEO role, which she assumed in June.
Amy had a more direct relationship with Russ: She worked for him for several years at one of his previous companies where he was CEO, the supply-chain software outfit HighJump*. Amy started at HighJump as a consultant in 2002 and quickly rose through the ranks. Shortly after Russ joined HighJump, he identified Amy as a high-potential leader and promoted her to the management team—specifically asking her to lead the business’s global-support organization. She eventually became the senior vice-president and general manager of a large division focused primarily on the beverage industry. Amy excelled internally as well as externally with customers; she built a sustainable product-management vision and account-management processes leading to improved customer retention and higher profits.
When Amy left HighJump a little over two years ago, she had just had her first child. She took some time off before taking a new position as an executive-in-residence at Battery Ventures about six months later. Battery’s private-equity practice keeps a stable of these executives on hand as a ready pool of talent to run newly acquired companies. So when the Enviance board needed a new CEO last year, Russ knew Amy was available and up for the challenge.
In Nancy Ham’s case, she never worked with Russ or Chelsea before signing on at WebPT. But, she had met Chelsea years before when Battery had considered investing in one of her previous companies, MedVentive, which makes tools for physician performance analytics. Chelsea became a big fan of Nancy’s leadership style and her business track record, and vowed to keep in touch.
According to Nancy, a Battery/MedVentive partnership wound up not being the right fit
when the two parties first met at that time. But she was impressed with Chelsea and made a mental note about it. “If you maintain a broad network, you know who you want to work with,” Nancy said. When she heard about the WebPT job last year and found out Battery was the company’s major investor—and Chelsea was on the board—she decided to look into it.
We think maintaining broad, deep and diverse networks of executive talent is critical for private-equity investors, as well as board directors. So is a willingness to take a chance on first-time CEOs. With many women ascending corporate ladders in force only in the last 10-15 years, there are simply fewer experienced female CEO candidates to choose from—so someone needs to give them their first chance. (This was also a point mentioned in the recent New York Times story about appointing women to corporate boards; many candidates are first-time directors, and are often rejected for board openings for this reason.)
Finally, we would note that these three recent Battery-company CEO appointments all happened outside of Silicon Valley and its dominant (and often male-focused) engineering culture. In the Valley, the public hand-wringing about the lack of women in high-ranking technology positions—and in partnership roles at VC firms–continues, and should be addressed. But there are great female executives working everywhere, including places like Georgia, Minnesota and Arizona. You just have to take the time to seek them out and get to know them. They could potentially do great work for you and your companies.
*For a full list of all Battery investments and exits, please click here.