Diverse board leadership is becoming a priority for public and private companies, and discussion around the topic continues to grow. From the business community to the public at large, the lack of diverse leadership is increasingly seen as a detriment to company performance.
Only 9 percent of unicorn companies — companies with a valuation of $1 billion and up — have board seats filled by women despite evidence showing diverse boards lead to better business outcomes.
While governments are starting to take note — California recently passed legislation to ensure that at least one member of a public company’s board is a woman — private and public companies are still being urged to build more inclusion into their company boards.
Curated talent marketplace theBoardList is one such organization looking to drive change and empower female business leaders across industries and build a new kind of diverse boardroom. The organization already has more than 5,000 members, and is looking to increase its community through a new #BoardForward crowdfunding campaign.
The campaign seeks to raise $200,000 to help the organization find more female board candidates, prepare them for board service and help them find a board placement.
Shannon Gordon,CEO of theBoardList, spoke to DX Journal about the priorities of the crowdfunding project.
DX Journal: The launch video for the crowdfunding project states that “Boards lack diversity because networks lack diversity” — can you unpack that?
Shannon Gordon: The vast majority of board searches, in fact 96 percent of them, are filled via referral. So inherently, they’re dependent on networks. The only way you’re going to get diversity in the boardroom is if the networks are diverse, and today the vast majority of CEOs and boards are made up of men.
Of course it’s not true that men don’t know great women. But we do know that it’s a human tendency to find people who look like you, act like you, and think like you when looking for new colleagues. It’s that homogeneity in those networks, in part, that drives the lack of diversity in the boardroom in particular because it’s such a network-based form of search.
DX Journal: Now you’re launching the #BoardForward crowdfunding campaign. Why go the crowdfunding route?
Gordon: We have a really engaged community of people who are very excited and anxious to support an increase in diversity in the workplace generally, and are looking for the right tools and systems to help make that happen.
Because theBoardList offers a solution, there are so many different ways which we can advocate for diversity. Advocacy is a very important part of driving change, but we’re really passionate about providing a solution and a tool for people to use for when they come to realize that diversity is something that will help their company reach its peak performance. We’re there with a solution.
For us, the crowdfunding campaign is about harnessing that engagement and enthusiasm and desire to make change from both the community and the public. So much of the context in the last year plus has shifted, and I think people are looking to make their own personal impact.
DX Journal: You want to scale your platform — what does that mean?
Gordon: It’s a couple of things. The first is reach. We started initially focused on the tech community, but very rapidly moved beyond that, and now we cover virtually all industries.
We want to make sure we continue to drive depth into each of those industries. Every time someone comes to theBoardList, we want them to find the perfect board candidate. That’s our aspiration. So we want to make sure we are talking to, and reaching, all of those qualified women who have the potential to be that candidate.
The second thing is that we want to continue to make investments in our platform technology. As we scale the community, we need to be able to effectively match candidates with the right opportunity. So we’ll continue to make investments in our ability to do that matchmaking effectively in our search algorithm.
Lastly, we want to make sure that we’re driving demand. There are many companies that already see the value in diversity and are actively looking for female candidates. But there are also many that haven’t realized this yet. We want to be talking to those companies, so we’ll need to scale the team and scale the reach to be as effective as we want to be.
DX Journal: What kind of success has theBoardList seen so far?
Shannon Gordon: We’ve grown our community to more than 5,000 people so far, 80 percent of whom are CEO or C-suite or board of directors already, so it’s a very premium talent marketplace.
We’ve also had more than 550 searches on the platform since it launched in 2016. It typically takes about nine months for somebody to find a board director, and we’re exposing additional candidates who might not have been found before.
Finally, almost half of our placements have been women who are serving on their first board. Which means that through theBoardList, they found their first board seat. That’s really exciting for us because what we want to make sure we promote mobility for women who are perhaps just below board service, but haven’t gotten a chance to serve yet.
DX Journal: How have you been growing your network up to this point?
Gordon: It has been almost entirely word of mouth which is why we’re so excited about the impact we’ve had. But we’re also excited to use the crowdfunding campaign to help us get some of the capital we need to extend that impact.
In order to identify talent that is truly ready for board service, we leverage a network of board directors — people already sitting on corporate boards. They are some really impressive individuals that we know have impressive networks of people around them. We’re aggregating those networks. So inherent in our business is a word-of-mouth phenomenon, as we ask people to nominate women from their network for board service.
We want to extend that impact, which is why we’re launching the #BoardForward campaign.
Which innovations will shape Canadian industry in 2019?
Canada is in the midst of an economic shift. New and traditional industries are increasingly being driven by innovation and these advances in technology are shifting the economic landscape at an unprecedented pace.
This is the assessment by Borden Ladner Gervais, which is Canada’s largest law firm. The company has issued a new thought leadership report, titled “Top Innovative Industries Shaping the Canadian Economy”.
The report weighs in on the opportunities and risks Canada faces in order to maintain its status as an international leader in innovation across eight key industries: cybersecurity, the Internet of Things, smart cities, cryptocurrency and blockchain, autonomous vehicles, fintech, renewable energy and cannabis.
To find out more about the report and its implications for Canadian businesses, Digital Journal spoke with Andrew Harrison, a partner at BLG.
Digital Journal: Where does Canada stand as a global tech innovator?
Andrew Harrison: Canada has always been at the forefront of innovation. Products developed by Canadians or Canadian companies encompass a variety of industries and include medicinal insulin, the snowmobile, the telephone, the pager, BlackBerry Messaging, IMAX, the Canadarm and the goalie mask, to name a few. Canadians are also fast adopters of new technologies; email money transfer between individuals, which was inconceivable only a few years ago, has been used by 63 per cent of Canadians.
This is why Canada is recognized worldwide for its research and technological know-how, but we have to be mindful of the challenges in a global competitive market.
DJ: What potential does Canada have to grow faster? Is this sector specific?
Harrison: Canada is well positioned to succeed and take the lead in all innovative industries, but there are definitely sector-specific challenges that could limit this growth. For example, the lack of regulation as to whether cryptocurrencies are considered securities or not is creating uncertainty, which may restrain investment in this sector.
DJ: What are the risks that could hamper innovation and development?
Harrison: For any new product, financing is always an issue; with innovation, money becomes an even more crucial element. Companies must have access to capital – including from individual and institutional investors – if they want to bring their innovative product/process to life. Evolving politics and policies can also have a significant impact.
DJ: What framework will Canada need in the future to secure its innovation potential?
Harrison: The key element is finding a proper balance between regulating the issues that might be created by the innovation itself or its use and providing a space where innovations can thrive without too many restrictions.
DJ: What does the Canadian government need to do?
Harrison: In many cases, laws and regulations were enacted long before we saw these innovative technologies and products brought to life, so they need to be updated. In certain sectors, such as cryptocurrencies and autonomous vehicles, the Canadian government has yet to provide a framework that would define the playing rules for all participants.
The government will also need to take a look at its current regulations on privacy: the coming into force in May 2018 of the European General Data Protection Regulation (“GDPR”) and recent high-profile data breaches have created the need for stronger privacy guidelines. Failure to do so could prevent Canadian businesses from accessing the European market.
DJ: What can academia contribute?
Harrison: Universities play a big role in fostering innovation – they could be the home of research and innovation and incubators of ventures, entrepreneurs, and tech talent. Universities can partner with industry players and have their researchers work closely to solve key industry issues. This is already happening in Canada. The Smith School of Business and Scotiabank, for instance, have partnered to set up the Scotiabank Centre of Customer Analytics at Smith School of Business to bring together professors, graduate students and analytics practitioners to collaborate on applied research projects in customer analytics. The academia plays a big role in creating an innovation ecosystem.
DJ: What is Canada’s most pressing technological need?
Harrison: There is still much work to be done to connect with Canada’s rural and remote communities. In 2016, the Canadian Radio-television and Telecommunications Commission (CRTC) declared that broadband Internet amounted to an essential service and adopted minimal performance standards across Canada: 50 megabit per second download and 10 megabit per second upload. However, the evidence presented to the Committee by a variety of stakeholders shows that the digital divide remains prominent in Canada – it is estimated that it will take roughly 10 to 15 years for the remaining 18% of Canadians to reach those minimums. Canada needs to develop a comprehensive rural broadband strategy in partnership with key stakeholders and make funding more accessible for small providers.
DJ: What type of investment is needed with skills and training?
Harrison: Canada has a serious shortage of tech talent, which makes it imperative for both the government, the education, and the business sector to invest in raising and fostering STEM talents. To help businesses attract the talent they require, the federal government is offering hiring grants and wage subsidies to offset payroll costs for recent post-secondary STEM students and graduates.
Poor IT integration racks up massive costs to companies
Another important finding from the report is that poor integrations and lack of resources contribute to hundreds of lost orders each year, leading to annual revenue losses in the range of $250,000-500,000 for 57 percent of those firms surveyed.
As well as spelling out the cost implications, the survey also aimed to identify core business problems behind integration challenges:
- Experience: The survey found that while 95 percent of the surveyed companies strive to enable their business ecosystems, 38 percent reportedly lacked confidence in their capacity to scale to support the integration initiatives foundational to doing so.
- Complexity: In relation to this, 63 percent of Information Technology decision-makers stated that new business onboarding is too complex and takes too long.
- Resources: 29 percent of companies reported they lacked the skilled resources to build and manage integrations between systems, applications and partner ecosystems.
- Legacy systems: 22 percent of respondents indicated that legacy technologies cause significant delays in generating new revenue. Following this, 81 percent of companies in this position said they believe replacing legacy systems will support emerging business initiatives.
These factors led Cleo CMO Tushar Patel to say: “The overwhelming consensus from these IT decision-makers is that new business demands – many of them brought by forces outside the company – are putting additional pressure on organizations and technologies to deliver better ecosystem integration solutions.”
He adds: “And when they can’t, it’s costing the business money. But for many of these organizations, it’s not an immediately solvable problem because they don’t have the strategy, the tools, the budget, or the resources to execute on these revenue-impacted initiatives.”
In terms of remediation activities to address these obstacles, the vast majority of respondents stated that modernization is key to consolidating disparate technologies, automating data transaction processes and gaining visibility into their critical data flows. These reasons account for why over half of the enterprises indicated they plan to modernize their integration and IT infrastructure in 2019.
Growing world-class scaleup hubs through global lessons
Dean Hopkins, CEO at OneEleven, discusses how global scaleup hubs can learn from each other in order to build outstanding scaleups.
Any time a new global city or region emerges as a technology or innovation hub, the inevitable comparisons to Silicon Valley begin. New York as Silicon Alley, Israel as Silicon Wadi, and Toronto was recently dubbed Maple Valley to much scorn.
But it’s time for globally emergent innovation hubs to look beyond Silicon Valley as they work to build scaleup success, with each location learning from the specific lessons of one another to help all players in the community succeed.
Outside the original Valley, collaboration, diversity and connections into other ecosystems are major strategic advantages for any hub that wants to scale faster – more connections, more funding, more talent, more resources and more stories to share to teach others.
Just look at Stockholm: With a population of only one million, it has developed more Unicorns per capita than any other innovation ecosystem outside Silicon Valley. Among other things, connecting into other major hubs helped propel growth and seed opportunity.
With OneEleven now established in the UK, we’re applying lessons from two leading hubs — London and Toronto — to guide our strategy and propel our value. Both cities embody hard-earned scaleup lessons, like specialization, building ecosystem partnerships and leveraging the power of diverse leadership, that we believe are key to ecosystem and company success.
Focus on growing the greatest verticals
London has built an ecosystem around its strengths.
The city is by far the leading source of fintech innovation worldwide: it has the greatest concentration of fintechs and the largest workforce in fintech — it dwarfs everywhere else even New York. In the first quarter of 2017, London saw $421 million invested in its fintech industry pushing New York out of the top spot for fintech investment. The City of London has worked with a variety of institutions to rally behind this emphasis on fintech, bringing together government, educational institutions and various sources of funding to embrace the fintech ethos.
The lesson to be learned from London’s focus on fintech is that innovation hubs need to concentrate their efforts in certain sectors where they already stand out as a global leader.
In Toronto, we’re starting to see a lot going on in the deep AI tech space, through the Vector Institute and other organizations building on a research base of over 30 years by Dr. Geoffrey Hinton and his colleagues. Of course, there’s room for improvement. While research labs are popping up regularly, with big partners involved, Toronto and Canada are lagging when it comes to patents and application of AI tech. As we build up this sector of our innovation ecosystem, we have to develop a well-rounded AI industry that includes a robust IP regime to keep AI innovation in Canada.
Diversity in leadership
Both London and Toronto also boast the highest demographic diversity of global cities, and demonstrate how valuable entrepreneurial leadership from all over the world can be. Forty percent of London residents classifying themselves as other than white according to a 2011 census, and that diversity powers the tech and innovation ecosystem in the city. Recent research shows that immigrants and people from minority backgrounds in the UK are twice as likely to be early-stage entrepreneurs.
Toronto is similarly diverse in its population, and talent is one of the reasons the city is seeing global recognition as an innovation hub.
Canada’s fast-track visa program prioritizes highly skilled workers and entrepreneurs and was created as a talent magnet for Toronto especially – last year MaRS released survey results showing 45 percent of Toronto tech companies made international hires in 2017 alone, and 35 percent of respondents used the visas to hire.
Other scaleup hubs could build valuable leadership and collaboration from a similar approach to entrepreneurship: one which looks to bring in more diverse, global talent on the leadership side, as well as the wider talent side. Scaleup communities have to be competitive on the world stage by inspiring people from all over the world to come and build their businesses there, as a lack of immigration and global perspective can starve an ecosystem of oxygen.
Culture of collaboration
We’re very fortunate in Toronto to have a culture of collaboration that starts at the earliest stages of entrepreneurship, and continues throughout company growth. There’s a strong expectation that you will work together, and for that reason, forming a community in Toronto is almost a matter of course.
Hubs like MaRS, 111 and the DMZ, for example, have opened up prime real estate to provide space for young companies to grow and to foster their developing businesses. Canadians have proven they are wired differently and Toronto’s collaborative and inclusive culture is one of its strongest competitive advantages.
In London, there’s a hyper-competitive environment for businesses, and perhaps not as naturally collaborative of an environment. That might just be because the city has only just recently seen an effort made to boost that kind collaboration from organizations like the Scaleup Institute and Tech London Advocates.
But collaboration between government, academia and business is one of the things that makes London a world-class scaleup hub.
Collaboration between groups tends to be verticalized in the UK, with TheCityUK being a prime example; the industry-led body that represents UK-based financial and professional services companies showed that collaboration between financial institutions and fintech companies can speed up the process of creating innovative products and services. By looking at IP, regulatory compliance, data protection and privacy, TheCityUK provided seven possible models for collaboration between banks and fintech companies.
Big scaleup success stories can also influence the effort to increase collaboration in scaleup hubs — and London has some amazing stories to tell.
Renewable energy company Bulb grew from 85,000 customers to 870,000 in the space of 12 months, becoming one of the fastest-growing scaleups in the UK. The company’s founders Hayden Wood and Amit Gudka are immensely proud of their place in London’s ecosystem. This is how how big names in a scaleup hub can advocate for an entire community.
For our part at OneEleven, we’ll work hard to build up that kind of collaborative community and collective effort as we continue to expand into London’s innovation ecosystem. We want to ensure that the success of these companies continues past their early stage, into growth and on into the billion-dollar club. The middle chapter is currently not being written in London — despite early stage support for companies and big success stories — and that’s what 111 is here to address.
Global scale through collaboration
Innovation hubs around the world can also work together to take the friction out of companies expanding between markets. Furthermore, cooperating markets can increase their competitiveness by promoting an exchange of innovative business practices, and reap the economic benefits that scaleups can bring to innovation ecosystems.
London and Toronto are a good example of global collaboration, as they the two cities have begun to explore greater cooperation when it comes to facilitating expansion between hubs.
The Mayor of London’s promotional agency London & Partners has opened an office in Toronto to better encourage Canadian businesses seeking to expand to consider London for their next destination, and to support UK businesses seeking expansion into Canada’s market. Over the last decade, the organization says 44 London businesses have expanded into Toronto and 118 Canadian businesses have set up shop in London during that same period.
This is only the beginning when it comes to proper cooperation between these two cities: government, academia and innovation hubs should work together to encourage scaleups in their efforts to expand between international markets.
Greater than the global sum of our parts
At OneEleven, it seems to us that the unique evolution, and now collaboration, between the London and Toronto ecosystems signals the rise of a global network of innovation that is in its early stages. Such a global network, powered by the diversity of each market, promises to have a dramatic effect on the ability for scaling companies to access talent, customers, investors and partners much more easily. We are excited to be a part of the rise of this globally connected and collaborative ecosystem that builds on what was started in Silicon Valley, but brings innovation into the more global and highly connected digital present.
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