Ellen Pao's suit was wake-up call for Silicon Valley
SAN FRANCISCO — The jury handed Ellen Pao a major defeat in her sex discrimination suit against her former venture capital firm on Friday but a bigger story emerged from the five-week trial: Largely male Silicon Valley has been put on notice that it needs to make big changes to how women are treated.
After two days of deliberation, a jury found that Kleiner Perkins Caufield & Byers did not discriminate against its former junior partner.
But observers say Pao's lawsuit still sent a strong message, not just to Sand Hill Road, home to the world's most powerful venture capital firms, but to Silicon Valley at large by training the national spotlight on the gender imbalance in the tech industry. On Friday, the hashtag #thankyouellenpao was popular on Twitter.
"While Ellen Pao was unsuccessful in proving the facts of her case, this trial sparked an important conversation about women in venture capital and, more broadly, how bias and discrimination play out in today's workplace," said Joelle Emerson, founder of diversity consulting firm Paradigm. "I am confident this conversation will lead to important changes both in Silicon Valley and nationwide."
Publicity from the lawsuit — replete with an alleged discussion of porn stars, amorous trysts in parking lots and dinners with Al Gore — has turned up the pressure on the technology industry and the very male world of venture capital.
TINDER, 'GAMERGATE'
Over the years, Silicon Valley sexism has made plenty of headlines, from the settlement of a sexual harassment claim at dating start-up Tinder to the frat-boy antics of software developers at tech conferences to "Gamergate" — the online abuse and harassment of women in the video game industry. But no incident captured public attention like the Pao case.
"I believe that sexism in tech is a real problem," Sam Altman wrote in a tweet this week. Altman runs incubator Y Combinator and sits on the board of Reddit, where Pao is interim CEO.
Former Yahoo executive Sue Decker says she admires Pao for having the "guts" to pursue the three-year legal battle.
"I think we may look back at this as a watershed moment — regardless of how the very attentive jury comes out on their verdict," Decker wrote in a blog post.
In her lawsuit filed in San Francisco Superior Court, Pao claimed that Kleiner Perkins did not promote her because of her gender and that it retaliated against her for complaining about it. She also alleged that the firm did nothing to prevent the discrimination and ultimately fired her in 2012 for complaining. She was seeking $16 million in compensatory damages plus punitive damages.
Pao joined Kleiner Perkins in 2005 as chief of staff to marquee partner John Doerr. She was promoted to junior partner but never made senior partner. Kleiner Perkins is a prominent Silicon Valley venture capital firm that backed Google and Amazon.com.
IMPACT ALREADY FELT
Despite the verdict in Kleiner Perkins' favor, the trial has already had an impact on the status quo in Silicon Valley, says Freada Kapor Klein.
More than a dozen venture capital firms and technology companies have reached out to her for help on combating bias and making their workplaces more welcoming to women, Klein says. And the case has drawn attention to the everyday microaggressions faced by women in the technology world, she says.
"Ellen Pao has shown exceptional courage for standing up, speaking out and pursuing her claims. For women and people of color in Silicon Valley, the treatment she experienced is all too familiar," says Klein, founder of the Level Playing Field Institute and partner with Kapor Capital.
"They understand her situation as something akin to 'death by a thousand cuts' or the cumulative effect of many instances of being excluded and/or being held to a different standard than their white male colleagues."
FEW WOMEN VC'S
As a woman, Pao was an anomaly in venture capital, which controls the spigot of wealth in high tech.
Only 6% of venture capital partners are women, down from 10% in 1999, according to a study by Babson College. Research conducted by Fortune magazine determined that only 4% of people in senior investing roles at venture capital funds are women.
Nearly six out of 10 female venture capitalists surveyed for a Harvard study said they felt at a disadvantage because of their gender. About a third said they received less informal feedback than their male counterparts and about a quarter said they did not get as much mentorship.
As an Asian-American woman, Pao was even more isolated.
Research shows Asian-American women are least likely to attain positions of power in corporate America. In 2010, Asian women represented just 0.4% of Fortune 500 board members.
Facebook and Twitter are now facing gender discrimination lawsuits by former employees, both Asian-American women.
The dearth of women in venture capital is part of a broader gender imbalance in Silicon Valley.
Seven out of 10 employees at tech companies are men. Few women make it to the executive suite or the boardroom, which are the recruiting grounds for venture capital firms.
In an e-mailed statement, Kleiner Perkins said: "Today's verdict reaffirms that Ellen Pao's claims have no legal merit. We are grateful to the jury for its careful examination of the facts. There is no question gender diversity in the workplace is an important issue. KPCB remains committed to supporting women in venture capital and technology both inside our firm and within our industry."
Pao held a press conference after the verdict.
"If I've helped to level the playing field for women and minorities in venture capital, then the battle was worth it," she said.
KEY MOMENTS IN PAO TRIAL
March 14: Ellen Pao trial: Acceptable behavior for men wasn't for women
March 12: Ellen Pao critiqued for interactions with female colleagues
March 12: Ellen Pao avoids public airing of family finances
March 10: Ellen Pao testimony leads to visible cringing
March 6: Mary Meeker quotes cap second week of Ellen Pao trial
March 5: Ellen Pao trial takes a raunchy turn
March 4: Kleiner bigwig takes heat over tape
March 3: John Doerr testifies at trial brought by ex-mentee Pao
March 2: Man Ellen Pao accused of retaliation had bonus docked
Feb 27: Little 'upward mobility' in venture capital
Feb 26: Ellen Pao could have made $2.6 million as a senior partner