DeLinda Forsythe, the founder and CEO of San Diego-based furniture distributor Innovative Commercial Environments, isn't quite sure how she ended up running a company with 20 women and only three guys. "None of it was conscious," she says. Nonetheless, she has some ideas: Women, she says, don't get a fair shake in her industry. Her previous employer shorted her on commissions, she says, by mysteriously and repeatedly changing the company's compensation structure.
In part, Forsythe sees her company as an effort to keep that same sort of thing from happening to the young women coming up behind her. "If you're good, you are going to move up and you will make money," she says of her staff. "I hope you make half a million a year. You make as much as you can. You go, girl. Because, hello, I'm going to make money, too." Her company now has about $12 million in annual revenue.
A survey of 279 female entrepreneurs conducted by Inc. and Fast Company found that women founders are disproportionately likely to hire other women. On average, these businesses have workforces that are 66 percent female. Among companies in the S&P 500 Index, about 44.7 percent of employees are female, according to Catalyst, a not-for-profit that promotes women's advancement. Silicon Valley tech companies are famously male: One analysis of 23 large tech companies found that only about 36 percent of employees are female.
Of the companies in the Inc.-Fast Company survey, only 22 percent have more male employees than female ones. And 45 of these female-founded companies have no male employees at all. The reasoning behind hiring a majority of women echoes male founders' rationales for hiring mostly men. Among them: cultural fit and the pipeline problem.
Like Forsythe, Kathy Cheng, founder and president of Toronto-based manufacturer Redwood Classics, didn't set out to build a company that is staffed mostly by women. But in her industry, apparel manufacturing, it's perhaps less surprising. In the late 1990s, Cheng says, Toronto saw a huge inflow of immigrants from Hong Kong: "Many of the immigrants who come here are skilled in our trade, and they do happen to be women." Redwood Classics currently employs about 110 people. About 80 percent of them are women.
Cheng thinks she can transform the workplace and cultural stereotypes that her female employees once faced. With so many Asian employees, she notes that her factory is "a little Asia," a culture she says is highly patriarchal. "I was that typical Asian, quite shy," she says. That's no longer the case. And she thinks she can help other women grow and find their voices as well. "I was attracted to a couple of recent hires because you can tell they're smart, and they have an opinion, but they may not feel comfortable expressing it." She tries to create an environment where such a person -- usually a woman -- can feel comfortable speaking up. "I have more to offer that person," she says.
Then there's the pipeline problem. Often, the term refers to the difficulty of tech firms in finding suitable female candidates, given that fewer women than men graduate from college with STEM degrees. In Cheng's case, she says, there are few men who pursue industrial sewing skills -- necessary for many of her company's positions. She was recently recruiting at a local fashion school, where she interviewed four women and one man who were learning industrial sewing. "I think he was the only man in that cohort," she says.
Forsythe also wants to hire more men, and people of color. "We want a more diverse workforce, because I know that's very successful," she says. Most of her new hires come from referrals by existing employees, and those referrals tend to be white women. "I haven't really analyzed why we get female candidates," Forsythe says. But she does say her company has a reputation for being a very friendly environment for new moms. And, she adds, "You're never going to be sexually harassed here. It's never going to happen. It's just not." If one of Forsythe's female sales reps is supposed to meet a male client for breakfast or lunch, and the client can suddenly meet the rep only for happy hour at a bar, Forsythe will go along to ride shotgun. "That's how protective we are," she says. "Just because I put up with this sort of thing doesn't mean I want my granddaughter or daughter to put up with it. We want to make a change."