Entrepreneurs

Ellen Pao on why it's so hard to change the boys' club culture of Silicon Valley

Silicon Valley is notoriously a boys' club. Men, who hold the majority of positions of power in investment firms, tend to invest in other men.

And the men who have succeeded in the system often don't see or want to admit that there is a problem with the system that enabled them to succeed.

"If I'm a successful CEO that came in from the system, it's hard for me to say that it doesn't work, that the company isn't a meritocracy," Ellen Pao, a leading voice on diversity issues in Silicon Valley, tells CNBC. "I mean, I succeeded, the company succeeded. Why do I have to change anything?"

Ellen Pao.
Photo by Marla Aufmuth
Ellen Pao.

"This is the culture that has always been and this is the culture people grew up in and this is the culture that has been very successful."

In 2012, Pao filed a lawsuit in San Francisco alleging her employer, top Silicon Valley venture capital firm Kleiner Perkins Caufield & Byers, discriminated against her for gender. The jury ruled in favor of the venture capital firm, but the case became a referendum on the lack of gender diversity in Silicon Valley and Pao became the face of the issue.

Indeed, a recent survey from industry group the National Venture Capital Association and consulting firm Deloitte found that while women are 45 percent of the venture capital workforce, women overwhelmingly serve in low-level roles. Women make up 95 percent of administrative roles, 75 percent of investor relations positions and only 11 percent of investment partners and leaders of investment teams.

"If I'm a successful CEO that came in from the system, it's hard for me to say that it doesn't work, that the company isn't a meritocracy." -Ellen Pao, leading voice on diversity issues in Silicon Valley

Not only do men hold most of the leadership positions at venture capital firms, but they also get most of the money those firms dole out. Start-up investment firm BBG Ventures, which focuses on investing in women entrepreneurs, says that more than 90 percent of venture capital investment dollars go to men.

Pao recently accepted a leadership position at The Kapor Center for Social Impact, where she will work to develop strategies to increase diversity in technology.

She's got a tough road ahead. But she knows that.

"When you get to a point where it's so baked into every aspect of every process and it's a big company and you're part of a process, it becomes very hard to unwind all of it," says Pao. "You change one thing, and it manifests into problems in other areas. It's hard to undo all those impacts of homogeneous culture at once."