Slack shows even start-ups that focus on diversity early are not diverse
SAN FRANCISCO — In 2014 Slack Technologies launched its workplace collaboration tool and began to grow quickly to meet demand just as the technology industry was taking a very public and hard look at its lack of diversity.
The 30-person company jumpstarted a conversation that chief executive Stewart Butterfield sums up as: "Let's talk about what kind of company we want to be down the road." What Slack hoped to avoid: Growing the way technology companies typically do by hiring a lot of white and Asian men. One of the executives penned a manifesto that pledged Slack would hire as many people from diverse experiences and backgrounds as it could.
For all its good intentions, three years later this privately held company used by five million people and valued by investors at nearly $4 billion is not much more diverse than many of its peers. Of its hundreds of employees, relatively few are people of color and, while it has a very strong showing for women in technical and management roles, few women hold leadership roles, according to the company's latest diversity report card that it released Wednesday. Nearly 60% of Slack workers in the U.S. are white and 25.2% are Asian. More than seven out of 10 company leaders are men.
Progress has been particularly slow in bringing more African Americans and Hispanics into the fold. Last year, for example, 4.3% of technical roles in the U.S. were held by African Americans. This year Slack says that number has increased ever so slightly to 4.8%, showing how challenging it is even for smaller companies to disrupt the industry's insular growth patterns.
"I tend to be a glass is half full kind of person so I tend to think that it is getting better," Butterfield told USA TODAY in an exclusive interview. "I don't think it is going to happen super quickly."
Butterfield has publicly championed the importance of reversing decades of exclusion in the tech industry — not, he says, for the business benefits alone, but because he believes the industry has a moral obligation to crack open opportunities for everyone. And Slack has been held out as an example of a tech company that seeks out people from underrepresented backgrounds and strives to create a more inclusive work culture. When Slack won a Crunchies award for fastest rising startup, the company sent four female engineers of color to the awards show to accept the industry accolade.
The slow pace of change in the racial make-up of Slack throws some cold water on hopes by diversity activists like Ellen Pao, who say they see a new attitude from younger tech companies that are instituting more inclusive hiring policies from the start.
With tech companies appealing to an increasingly diverse and global marketplace, historically underrepresented groups are becoming key to future growth in the sector. The industry is looking for ways to include more women and minorities who have been largely left out of of some of the nation's highest-paying careers and out of one of the world's greatest wealth creation machines.
"There are tech companies that talk about wanting an inclusive culture and hiring diverse candidates and then there are tech companies that just do it. Slack is the latter," says diversity advocate Wayne Sutton, co-founder of Change Catalyst and the Tech Inclusion Conference.
Slack, which changed its methodology for measuring the racial diversity of its workforce this year, declined to provide comparable statistics for last year.
Percentage wise, Slack is better than the norm for tech companies, with 4.4% of U.S. workers African American and 6.3% Hispanic. At Facebook and Google, 2% of employees are African American and at Google, 3% are Hispanic and at Facebook, 4% are Hispanic. Still, because Slack is a relatively small tech company, that means it employs approximately 24 African Americans and 34 Hispanics out of a U.S. workforce of 540 people.
In technical roles, 4.8% of Slack employees in the U.S. are African American and 6.7% are Hispanic and in management roles 5.3% are African American and 5.3% are Hispanic.
More women engineers
At Slack, women have fared much better, making up 43.5% of employees globally, unchanged from the last diversity report in February 2016. Nearly 30% of technical roles are held by women, up from 24.5%, a standout in the techindustry; and 48.1% of management roles, up from 43% last year. This year Slack disclosed the representation of women in its leadership ranks for the first time: 28.3%.
Those demographics compare favorably to Facebook (where 67% of employees are men) and Google (where 69% of employees are men), and are on par with high-profile start-ups such as Pinterest where women make up 44% of the workforce and are better than others such as Uber (whose workforce is 36.1% female).
In March, Slack added a woman as its first independent director, Square chief financial officer Sarah Friar. As is typical for a young tech company, the rest of the board is made of up Butterfield and three Slack investors, all men.
"We're going to continue to make good choices on the board," Butterfield said. "I would like to have a board as diverse as possible."
Transparency is coming slowly to Slack. When USA TODAY requested its EEO-1 filing, a form that federal contractors routinely supply the government on the diversity of their workforce, Slack refused to release it. When asked about hiring goals or targets for underrepresented groups, Slack said it does not set them.
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Significantly changing the demographics at Slack and in the broader tech industry will take time, Butterfield says, but he is cautiously optimistic because more people are talking about diversity in the tech world. And that conversation is winning over naysayers, he says.
"I am definitely not going to say that 100% of engineers in Silicon Valley have become woke or something like that, but I absolutely have seen that change in individuals," Butterfield says.
Some tech leaders have embraced diversity as a business advantage. Some are just scared of bad publicity, Butterfield says. For others like Butterfield, it's a cause. Whatever the reason, Butterfield says he'll take it.
"I am less motivated by the idea that there will be better business results. Hey, that's great if it happens," he says. "I don't want this to be based on the idea that this is a money-making opportunity."
For Butterfield, the raw numbers matter less than "how things evolve over the next few years." Slack has gained a reputation for hiring more diverse people, but many of them are coming from companies such as Google and Facebook. What Butterfield wants is to expand the pool of women and people of color in the industry at large.
Recruiting is critical. Slack considers job candidates from underrepresented backgrounds for every role and at every rung of the organization. Among its prominent hires have been diversity advocates and engineers Erica Baker and Leslie Miley, both African-American. Baker is one of the co-founders of Project Include, a nonprofit helping guide tech companies on the path to diversity. And Slack has formed partnerships with organizations such as CODE2040, which is working to close the racial gap in the tech industry, and has put a priority on hiring diverse talent over "pedigree and pattern matching," Sutton says.
A major focus for Butterfield: Nurturing talent within his own organization to produce the leaders of tomorrow. He's mindful that Slack's diversity numbers show a steep falloff from the management ranks to more senior roles.
"What will make a difference is if tech is this supportive environment where people are cultivated and they are able to move up the ranks, increase their responsibility and advance their careers," Butterfield says. "That will have an influence down the road in terms of the degree of role modeling there is and the degree of mentorship and the creation of these networks."
Follow USA TODAY senior technology writer Jessica Guynn @jguynn