The Importance of Backing Female Founders with Naomi Seddon
In part 2 of our Diversity Mini-Series, Arin Vahanian speaks with Naomi Seddon, author of Milk and Margaritas, on how diversity, especially with respect to gender inequality in the workplace, is key to improving the function of businesses of all sizes.
Arin Vahanian: Thank you so much for joining us for another episode of Start-Up Nation. Today’s topic is a very important one and one I’m very glad we’re covering today. Today’s topic is the importance of backing female founders. With that being said, we’ve got a very special guest in the studio today. Naomi Seddon, I am so happy you’re here with us today to talk about this very important topic. Thank you so much for joining us today, Naomi.
Naomi Seddon: Well, thank you for having me, Arin, and I’m so pleased to be here.
Arin Vahanian: Yes. Naomi, before we start, perhaps you could tell the listeners a little bit about yourself and your background.
Naomi Seddon: Sure, so I’m an international lawyer. I’m qualified in three countries Australia, New Zealand, and California, and I predominantly assist businesses to go global. I’ve helped over four hundred companies expand their business internationally. And in addition, I also sit on three boards and I’ve just released my first book, Milk and Margaritas, which is on a topic that’s very close to my heart gender equality in the workplace and specifically women’s health issues in the workplace.
Arin Vahanian: That’s fantastic, so we are going to discuss the book because it’s something I’m very, very interested in discussing, but before we do that, perhaps if we could kick off today’s episode by taking a look at where the current workforce is lacking. What do you say, Naomi?
Naomi Seddon: Yeah, thank you. Well, this is something that is very close to my heart. So prior to the pandemic, it was estimated to take at least a hundred years to achieve workplace gender equality. Now, that number is staggering alone. But as a result of the pandemic, which has had a disproportionate impact on women, it’s now estimated to take at least one hundred and thirty six years to achieve workplace gender equality. And some experts are actually estimating it could be even longer. Now, why does this matter? Well, there’s actually a lot of reasons why this matters Arin and the first one that is that if we are able to close the gap on gender equality, it could increase global GDP by up to 20 trillion dollars. Now that alone is a significant reason to care about this, particularly if you are in the area of investment, for example. But there are other reasons that are probably much closer to home for a lot of your listeners. And you know, some of the reasons are that increasing diversity within workforces has a direct link to increase productivity. It has a direct link to profitability, to lower share price volatility. The research clearly shows us that companies that are diverse outperform every time, and so this is something that every company should be aware of and be considering. And not just because it’s a good thing to do anymore, but because it’s actually becoming essential. And the reason for that is that clients are now demanding more in the era of diversity and employees are actively seeking companies to work for that actually care about diversity and have programs, policies and benefits to assist a diverse workforce. So gone are the days when this was a nice to have. This is now something that every single company around the world at every size needs to be thinking about.
Arin Vahanian: That is a staggering figure, $20 trillion. And I think that something that will really hit home for a lot of people, right, because we can talk about the topic all we want. Oh, it’s important to do this. But what you’re saying is there’s hard data to prove that companies will actually perform better in all of these metrics, right?
Naomi Seddon: Absolutely. And you know, I actually worked with a team of researchers for two years when I was writing the book to pull together data from all over the world. I didn’t want it to just be focused on companies that we’re so familiar with, such as the United States, Australia, the UK. I actually wanted to look at a lot of countries all around the world, such as India – countries in the Middle East. I wanted the data to be able to speak for the arguments that I’m making through the book and the evidence time and time again clearly shows us that this is correct.
Arin Vahanian: Indeed, yes, and another thing that you said, which was so interesting was: It’s not just about a social movement. Now clients are focusing on this right and employees are speaking up. Right. So this is pretty much across the board.
Naomi Seddon: Yeah, absolutely. It definitely is. People everywhere are demanding more. And I mean, even consumers, when they’re selecting products or services, you know, they’re asking questions about the environmental impact that their purchasing choices will make. But this is another area that they’re actually demanding more in. So it really is important for organizations to start looking at this and having a strategy and plan and some goals going forward for the organization.
Arin Vahanian: Indeed, and so it’s become really apparent that as a workforce, we’re missing something here now, despite all the progress. Of course, there’s been progress, but so besides all of the metrics around profitability and share price and so forth, why is backing female founders so important? Yes, of course, as a social movement. But is there a particular reason why startups, for instance, should care about backing female founders and creating a diverse environment?
Naomi Seddon: Well, this is a topic that is so interesting to me because women dominate the global economy when it comes to consumer spending and approximately twenty trillion dollars annually, another twenty trillion number, but it’s actually true. And that figure could climb as high as twenty eight trillion in the next five years. Yet amazingly, so many companies continue to fail to recognize this, which is just baffling to me. And if you take the beauty and luxury food industries, for example, it’s dominated by men trying to sell to women. According to the Fortune 500 companies of 2020 only thirty seven are led by women, and only one of these is in the beauty industry. Now, I mean, that figure is just outstanding to me. So if we think about that, it is a huge untapped market here. Why does this matter? I mean, why should we be investing more in female founders? Well, who better to know how to sell to women than other women? I think we are really missing an opportunity here when we’re thinking about where to put our money. And unfortunately, recent steps are really disheartening. Throughout the pandemic, there’s been a another shift and another impact to women. And unfortunately, the figures in 2020 have shown us that there’s been a substantial drop in venture capital funding for women with startups. So, you know, unfortunately, we’re going backwards.
Arin Vahanian: Wow. Yeah, and then and then you mentioned as well that. The COVID 19 pandemic actually hurt us really badly in this regard, right, pushing us even further back.
Naomi Seddon: Yeah, I made it. Have I? I was reading an article today, actually. I think current funding has dropped to between two point three and two point eight percent for women led ventures and enterprises over the last three years. So it is – it’s really disappointing.
Arin Vahanian: Yeah. And why do you think that may be the case recently?
Naomi Seddon: Well, I think there’s lots of reasons, but one of the unfortunate things that we’ve seen and there’s been a lot of talk about the great resignation, and this is not just limited to women, there are people that are withdrawing from the workforce in huge numbers globally to the extent that we have never seen before. But unfortunately, because of COVID and the constant lockdowns globally and the fact that so many children have been home from school, they haven’t been able to attend, you know, the burden of that has predominantly fallen on women. And so women are withdrawing from the workplace. And probably, you know, I would estimate that a lot more women are just unable to start businesses, seek funding, unfortunately. I mean, I even personally know a lot of women that have had to close down their business or take a side step through the pandemic because they just don’t have the capability to continue on. And and that has unfortunately had an impact in this area as well around funding for VC.
Arin Vahanian: Well, that’s really unfortunate, but I hope that as we get a better handle on things that we’ll be able to reverse this negative trend and get things moving in the right direction again. One figure, which was really fascinating to me is this 100 years or 100 something years? I don’t know if you’ve got like, obviously we don’t have to go through the numbers today, but I’m just curious, like how they came up with that or what sort of the metrics or the analysis behind that, that is fascinating. And again, you know, one hundred years I get kind of depressed hearing that number, you know, it should be right now. But can you maybe give us a sense of where that figure is coming from?
Naomi Seddon: Well, whatever. I mean, this type of research is conducted by a large number of organizations, actually. So a lot of universities conduct research into this. And I must admit, I am not a mathematician, I’m not an economist. So I don’t know exactly how they come up with these figures. But [Arin: Yeah, fair enough] I can tell you that we did look at a lot of data globally to determine these figures. And unfortunately, the research is fairly consistent across the globe, these figures. So it is really yeah, it is depressing to think about it, particularly as someone who has two daughters and thinking about the future generations before us. I just feel so sad that I have to stand before my own children and know that they’re going to face these same issues in the workforce that they’re going to be entering very soon.
Arin Vahanian: Well, it’s interesting, you should mention that, Naomi, I also have two daughters and a son, and I heard something my my oldest daughter told me one day when she came home from school. I can’t really remember what it was, but it was something related to this topic where I guess a classmate of hers had said something to the effect of, Oh, girls can’t do that, and I don’t remember what that was referring to, but it was ridiculous. I became irate, right? Like, I couldn’t believe it. So. I think a lot of this comes from the home, doesn’t it? I mean, it’s quite sad.
Naomi Seddon: Oh yes! I am so glad you mentioned that one of the topics in my book is all about culture and how culture drives this, and also the role that culture plays in driving change on this exact issue. And I talk about this exact point that we have to start by effecting change within our own homes and not just about talking to our daughters, but educating our sons, more importantly.
Arin Vahanian: And Naomi, I was just curious. How should startups go about addressing diversity or backing female founders, what are your thoughts?
Naomi Seddon: That’s a great question, and that’s something that I get asked a lot. A lot of people will say to me, Look, this all sounds great. Maybe in theory, we absolutely are on board. We care about these, but we’re a startup. We don’t have the funds to be implementing expensive programs and policies. I completely understand that. And that’s why when I prepared the book, what I wanted it to be was something that was going to be a useful tool for organizations of any size to be able to use as a resource. So what I’ve done is I’ve given you the business case for why this actually matters, no matter what phase in your business you are in. And I’ve also given you know, companies a lot of different ideas about ways that they can try and better assist to support their employees to succeed in the workplace. Because I recognize that, you know, providing paid adoption benefits or IVF benefits, which are fantastic employee benefits may not be possible for every organization at every size, but there are absolutely things that every organization can do. There is a global war on talent right now, but even without that difficulty that a lot of startups are faced with. They always have a challenge recruiting top talent in specific areas because they’re a startup and they may not be known. And if you’re in the tech industry, for example, you’re competing against Google, Facebook, LinkedIn, all of those big players for that top talent. So you have to think about benefits, policies that are outside the box to be able to attract that same type of caliber of talent.
Arin Vahanian: That is such a great point. You’re absolutely right. I mean, we’ve got a small startup, of course, they won’t be able to compete with Google and Facebook and so forth in terms of maybe base pay or bonus. But as you’re saying, they might be able to outcompete these larger rivals by offering benefits that the rivals won’t offer, right?
Naomi Seddon: Well, Arin, just on that point, there’s also a lot of research I’ve included in the book as well about the fact that employees actually don’t care just about salary. They care more about things like flexibility and the benefits that companies can provide them. And McKinsey actually did some amazing surveys that actually show that the figures can be as high as like 60 percent of people would switch jobs for, you know, benefits that are more generous. Gone are the days when people just care about a salary.
Arin Vahanian: Right. That’s a that’s a really good point and so you mentioned a few seconds ago about the global war on talent, right? And so what are your thoughts about it? And I know it’s difficult to forecast this sort of thing. But as we get over the pandemic or get better at dealing with it, what do you think some of the trends might be in the coming years in regard to diversity or backing female founders? What are your thoughts, of course, not having a magic crystal ball.
Naomi Seddon: But yeah. Well, millennials care about culture. They care about organizations that are not just talking the talk. They’re walking the walk. And they will generally do a lot more research before deciding whether to join an employer or not. So, you know, I think even in my generation, I think back to when I was just starting out in the workforce, need attend an interview and really try and sell yourself because you wanted that job and you wanted the could-be employer to want you. We are seeing a flip. It is now the employee or the candidate, rather, that’s interviewing the company, and they’re making the choice as to whether they want to join the organization or not. They’re assessing the organization and that company to decide, you know, is this an organization I want to work for? We’re going to see it come back a bit, probably some middle ground you know? At the moment, it’s an employee’s market. I’m sure that’s going to shift a little bit as we get through the pandemic. But I think there has been so much change within the last few years that I can’t ever see us going back to the way it was pre-pandemic.
Naomi Seddon: And people want flexibility. That is the number one thing. People realize that I don’t need to be going into an office every day. I don’t need to be doing 70 flights a year across the globe, which, by the way, is what I was doing prior to the pandemic. So, you know, we’ve found that there are new ways of working and employers need to get on board with that and they need to exercise some trust in their employees. And I think that’s something that has been fundamentally lacking in a lot of countries around the world. One of the examples I gave around flexibility I’d give prior to the pandemic was that it was really interesting: you know, obviously I grew up in Australia and I found in Australian workforces generally that you had to earn trust. And once you’ve earned it, then the employer would give you things like flexibility. In the U.S., I think it’s a bit different. It’s the reverse. I think employers, a lot of the time will give the flexibility and then if the trust is abused, they’ll withdraw it. So, you know, this is one of the things where the differences in culture do have an impact. But I think everybody has to get on board with this new way of working and the new demands of the workforce now and definitely the younger generations, they’re demanding different things.
Arin Vahanian: Wow, thank you for sharing that fascinating information, and you know what, I think it’s time that we talk a little bit about your book. Would you like to tell us a little bit about your book? And I know it was a labor of love for you to write, but perhaps you could tell us a little bit about it.
Naomi Seddon: Yeah, thank you. It definitely was a labor of love, and it’s something that I’m so proud of. It’s funny the day that you hold your book in your hand, your physical book for the first time, I felt like a little bit like when I passed the California bar and when I had my children and held them in my arms for the first time. It feels like giving birth to your baby because I did work on it for two years, like I said with a team of researchers. And basically, I’ve written the book in two parts, although it’s contained in the one book. The first part, I share my story about, you know, I went through a pretty horrific time I lost a number of children. I went through a hundred tests and I had nine surgeries in 18 months and ultimately had twin girls born via surrogate. And then I went on a very public legal battle to gain parental rights under Australian law. And so I’m now on the Board of Surrogacy Australia trying to advocate for change. And I like to say I became the accidental advocate of surrogacy rights in Australia. But so I learned a lot along the way because while going through all of this, I was partner within the firm, I was working crazy hours and I did things wrong, and I wanted to tell other female leaders exactly what I did wrong so that other people can learn from my mistakes. And I learnt a lot along the way about things that, you know, organizations do well and things that they do wrong and things they need to be doing better. And so the first part of the book really is just about me sharing very openly my story and those lessons. But like I said before, I wanted for part two of the book for sharing the research and the data. I wanted it to be a handbook that other companies can pick up, H.R. managers, board members because remember, this stuff needs to come from the top. And as someone that sits on a number of forms, I understand that completely that this is all great, but you need to develop a business case as to why this makes sense. And so what I’ve done, hopefully through the book, is give organizations the tools they need to then try and effect change within their own organizations.
Arin Vahanian: Wow, thank you so much for telling us about your book, Naomi. And by the way, you just mentioned a moment ago that you did a lot of things wrong. Well, I think you did a lot of things right?
Naomi Seddon: Thank you.
Arin Vahanian: And just hearing your story. It’s an inspiration for me, even though I’m not a woman, of course. But just hearing your story about the hardships you went through and what you had to go through to get to where you are and most importantly, becoming a beacon for change, right? So that’s that’s really special. And just so everyone knows, Naomi’s book is called Milk and Margaritas.
Naomi Seddon: It’s available a lot of places. Barnes and Noble, Target, Walmart, heaps of places online. You can find it. So yeah, thank you.
Arin Vahanian: That is fantastic. And and Naomi looks like we’re almost out of time and we’ve got to wrap up. But what do you hope our listeners can walk away with today?
Naomi Seddon: Frankly, the more organizations can start actually thinking about how they can affect change within not only their own organization, but also within their own families, within their own communities, because ultimately that’s where it stops, right? We’ve got to stop thinking about this stuff as a workplace issue that we need to care about and understanding why it’s important for future generations. So I really thank you for allowing me the platform to share this with you today, but I really hope more people start to think about the workplace and, more importantly, women within the workplace a little differently.
Arin Vahanian: I totally agree, Naomi, and I should thank you for taking time out of your busy schedule to join us today. And ladies and gentlemen, today’s topic was the importance of backing female founders. We hope you like the episode as much as I did. Once again, Naomi, thank you so much for joining us, and I hope we’ll have you here again sometime.
Naomi Seddon: Thanks very much. Pleasure to be here.