In this episode of The New Rules of Work podcast, Kathryn Minshew, Founder and CEO of The Muse, talked with Ellen Pao, CEO of Project Include and author of Reset: My Fight for Inclusion and Lasting Change. Ellen Pao received international attention when she filed a gender discrimination lawsuit against Silicon Valley venture capital firm Kleiner Perkins Caufield & Byers. She lost her case, but the lawsuit catalyzed a conversation we’re still having today about the lack of diversity in the workplace.
In addition to the lawsuit itself, Minshew and Pao talked about the environment that caused it, what Pao would do differently if she could go back to the trial, and how to move forward when it comes to increasing diversity and decreasing discrimination—of all types—at work.
They also discussed:
- How much (or little) progress we’ve made in educating people about diversity issues
- How today’s workers, regardless of their own gender, orientation, ethnicity, or ability, seek out employers who have a proven commitment to fostering diverse and inclusive workplaces
- Why an inclusive and diverse culture starts with the leadership of the CEO
- Ways to confront bias and discrimination at work
Episode 13 Transcript
Ellen Pao (voiceover): It takes that first person and that first spot is really uncomfortable and gets attacked.
Kathryn Minshew: Hello everyone and welcome to The New Rules of Work, a podcast from The Muse where we explore the changing landscape of work. Today’s guest has been on the front lines of pushing for more diversity and inclusivity in our workplaces. In 2012, Ellen Pao filed a gender discrimination lawsuit against a powerhouse Silicon Valley venture capital firm rocking the tech industry and exposing its very homogenous culture. Ellen, I’m so excited to have you on because I remember following the initial news of the lawsuit against Kleiner and really the way that that sparked a national conversation about diversity, inclusion, and behavior in the tech industry, but I want to, before asking you about that, I want to start and actually go back to before 2012 and really ask a little bit about when you were an investor at Kleiner Perkins and one of very few women in VC.
Kathryn Minshew: I was starting The Muse at that point. I was one of very few female founders in tech. So I remember a lot about what it was like for me, but I’d love to just ask you to start by maybe taking us through what your experience was like before the lawsuit that brought you national attention.
Ellen Pao: Yeah, I remember the first years at Kleiner as being really fun. It was this view into an industry that was very secretive at the time. I could work with all sorts of entrepreneurs, I could hear people’s ideas, and people were doing amazing things. It was a very transformative time in tech where we didn’t have phones when I started. The phones became part of everybody’s existence only really with like the iPhone and the Android phone. Back then it was more business people using phones. There weren’t apps. People didn’t have as many computers. It was this idea that we could give access to information and communication and connections to everyone wherever they are, whenever they want it. That’s come true, but I think it was much more earnest and much more oriented toward like changing the world than oriented around money at the time. It wasn’t until like the later years when people got much more capitalistic about everything. I mean, there was capitalism in it, but it feels like there’s more motivation around wealth than change these days.
Kathryn Minshew: Yeah. It’s interesting, actually. I remember back in the early years that I was starting The Muse, feeling like New York was very focused on business models, but Silicon Valley was all about the mission and the change. Yet, as I think we’ve all since learned, that future focus wasn’t always reflected in the work environments and the cultures and the teams. Then I want to go to 2012. You made what must have been a pretty big decision to file a gender discrimination lawsuit against Kleiner. That received industry-wide attention. It opened up a really important conversation. Can you walk us through what led to your decision? Were you surprised that the case received such widespread attention?
Ellen Pao: What led to the decision was this dichotomy I felt between what Kleiner said it was and then what was actually going on behind closed doors. What I saw happening was a lot of discrimination. We had this round ... The immediate catalyst for the lawsuit was a round of promotions where none of the women were promoted and almost all of the men were promoted. One of my partners at the time had done research and shown that the women’s investments were better. The women had better education, more work experience, more experience at Kleiner, better performance, and yet none of us got promoted. I started realizing, wow, this isn’t like me as being a problem. Even if everything that they’ve written in these reviews is true and I’m this terrible employee, my colleagues aren’t terrible employees. This is a bigger thing than just me. It’s this kind of systemic problem.
Ellen Pao: I started looking at things differently. A lot of the things that had bothered me before, like women having to do a lot of the menial tasks, women not being invited to participate in important conversations, women having a harder time getting their investments through, like it all started to click in my mind and I realized, wow, this is a much bigger problem and it’s not about me. It’s about the whole firm. Then as we started talking, internally I realized, wow, it’s not just this firm, it’s actually the whole industry. I felt like there was a change that needed to happen.
Ellen Pao: I was in a place where I had savings, I felt comfortable like taking the risk.
I did a lot of research, talked to a lot of people about what it was going to be like, and I felt like I could actually do it and follow through and actually push these issues to the public, where in my mind, I thought there would be some attention. I didn’t think it would be national attention. I didn’t think it would be international attention. There was actually like a reporter, I think, from China every day or two reporters from China every day in the courtroom. There was more attention than I thought, but I did think it was going to get some attention because at that time Kleiner was still very secretive and very private about how it operated. I thought people would be interested in hearing about all the things that had happened, how venture works at the one of the top firms and how venture discriminates. All of the things that I thought were really inappropriate and discriminatory, I thought other people would too, and it would take that external pressure to force Kleiner to change.
Kathryn Minshew: Yeah. I remember following coverage of the lawsuit, and as an early stage founder, it was the first time that I had seen some of my experiences reflected in the broader conversation. It was the first time that I could look at something that was really being openly discussed in the media, some of the quotes, the examples that came out during the trial. I remember talking with other female founders and having the sense of like, finally people are having a conversation about how inappropriate and how wrong some of these experiences are. That was really powerful.
Ellen Pao: It was fascinating that a whole set of people in venture didn’t think there was a problem, right? Then it took kind of this external view in the press to really open it up and get people talking about it. Even though the problems were so severe, it was kind of fascinating. We all kind of just kept quiet for a very long time and just let things pass.
Kathryn Minshew: Yeah, I know. I remember some of the things that happened to me early on when I was raising capital for The Muse and people would be like, “Oh, well, what do you expect?” I was like, well, better than this actually, better than this. I think that actually leads me to one of my next questions which is, for anyone who follows the case, they know that ultimately you lost the gender discrimination lawsuit and decided not to continue your appeals, but you really started a national conversation around workplace discrimination and bias that I think continues to this day. I have a couple of questions, but the first one is just, knowing what you know now, would you do anything differently?
Ellen Pao: I think a big part of it was the press kind of PR effort. I’ve followed the [instructions of the] judge saying, “No, you can’t talk.” It’s tradition not to talk to the press to keep the jury clean, but Kleiner didn’t do that. They had a whole team of press people. They had like four different PR people working on it, or I think two or three in the courtroom every day of the trial. If I were to do it again, I would do a better job of getting involved tactically in the press and having somebody help with that, because it was just that PR machine was really ... It was really painful. It resulted in like a lot of harassment of my family, and that’s one of the things I would have tried to prevent more.
Ellen Pao: I don’t know that there’s anything else that I would do differently. I don’t think people were ready yet to rule in favor of a plaintiff at that time. The issues were too new. There was just too much disbelief and skepticism because they hadn’t heard it before. It took more people speaking up and then kind of bringing back some of the people who had spoken up earlier and starting to have people really process these ideas to get to the point where they realized this whole system is really broken and needs to change.
Employees are saying ‘enough already — we need better values.’
Kathryn Minshew: Yeah. I think what’s going to be ... What’s so interesting to me about both the reception of your book and also the Netflix series that Shonda Rhimes is working on, which I think is going to be really exciting, is the environment has changed so much. You think about a number of cases in the past of women who spoke up. I think now looking back at some of the coverage from the trial, you can see it with different eyes based on things that have happened in the last couple of years than maybe people were ready to see it or to accept it back in 2015.
Ellen Pao: Yeah, I think so, which is such a positive change, right?
Kathryn Minshew: Absolutely.
Ellen Pao: I mean, it’s sad that we started where we did, but it’s progress. I think attitudes have really changed and that skepticism isn’t there anymore. It used to be when people said they had been discriminated against or had been harassed, it was up to ... The burden of proof was on the person speaking up to really have everything airtight, 100% proven with all sorts of evidence and all sorts of people who saw it. I don’t think that’s the case anymore. I think people understand that this is something that’s prevalent, especially in the tech industry. When it happens, hopefully that means people are dealing with it better.
Kathryn Minshew: Yeah. Actually, you’ve partially answered my next question, but I do think that we are seeing a growing awareness. As you said, people are not so shocked anymore like, “Oh my goodness, somebody would do such a thing?” Yeah, we’re seeing that some of this inappropriate or discriminatory behavior actually goes on in a bunch of different industries. As we look at the last couple of years in particular with so many different public moments, conversations around #MeToo, conversations around behavior and inclusivity at various tech companies, court cases around LGBTQ rights, do you think that ... I guess you said you think we’re making progress, but when you look at where we are on the journey, how are you thinking about that kind of arc towards justice?
Ellen Pao: Yeah, I think we’re still early. I don’t think we’ve changed some of the institutional biases. I don’t think ... I’m not positive that I would win if I litigated today, because the defendants have so much money, they have so many resources. The case law hasn’t really dealt with a lot of these issues in a really meaningful way. There’s still forced arbitration. There’s still ... I don’t know how much progress has been made in the legal system. I think all of the progress has been made in kind of the education of people and their awareness, as you said, and acceptance of these problems. I think the press has changed in its orientation quite a bit. I am excited to see that.
Ellen Pao: There’s a lot more work that needs to be done around changing the venture capital firms. I don’t see a ton of change. I think it actually ... Funding went down from 2.5% in 2017 to companies with women leaders, led by women, down to 2.3% in 2018, according, I think, to PitchBook. The percentage of funding that’s going to women actually went down, and it’s so small already, that for it to go down is terrible. There’s still not a ton of progress in the actual system when it comes to fixing these problems. There’s awareness, but it’s still going to take time to get people to change. I don’t see LPs, limited partners who invest in the venture firms that invest in startups, really making the effort to push for change either.
Kathryn Minshew: That’s, I think, one of the constituencies that a lot of people have been calling on and that’s been slow to react. No, it’s a really interesting take. I want to then ask you a little bit about your book. One of the things that I appreciated was how you’re putting out this call for businesses to hit reset in order to give everyone a fair chance to succeed. For people who might be listening who have not picked up your book yet, what does resetting a workplace look like? And is it something that can happen from the bottom up?
Ellen Pao: Oh, such a good question. I hope so because we’re seeing all of these companies where the employees are saying, “Enough already. We need some better values because we’re not operating in a way that is consistent with my personal values.” So I hope that that actually moves leaders. I think what has to happen is the leaders have to be convinced. At the end of the day, when it comes to inclusion, it’s up to the CEO, right? The board can’t really push. They don’t, and the investors don’t really push. The CEO has to decide, “This is an important issue and I’m going to make sure my team knows it and I’m going to make sure that it happens across the board.”
Ellen Pao: At Project Include, the nonprofit I founded to help push these issues and advocate, we have three values that we think are really crucial and critical to creating a diverse and inclusive company. The first one is its inclusion of everyone. We’re talking about across genders, across race, across ethnicities, across religions, across ability levels, across veterans, and across the different education levels, across whether you’re an immigrant or not. All of the people should be included in everything that you do. It should be comprehensive, right? It should be focused on hiring and your pipeline and bringing people in across all different parts of that process, but also, are you paying people fairly? Are you giving them the same opportunities? Are you promoting people fairly? Are you thinking about how you are firing people? Are you looking at people leaving to see whether you have a problem with making specific groups feel like they belong?
Ellen Pao: It’s really thinking about it as being a part of your culture and part of your business. How do I incorporate inclusion into everything that we do? Because it’s important for retention. It’s important for building great products. It’s important for recruiting new people. It’s important for making better decisions. It’s important for connecting with our customer base. So really thinking about like, how do I make sure that it’s part of everything we do and we’re thinking about everyone, or else we’re not really inclusive if we’re only including this one group of people. Then the third value is you need to use metrics so that you can see if it’s actually working or not and that you can hold people accountable if they’re not actually being effective.
Kathryn Minshew: Yeah. It’s so interesting what you say about the fact that more people are standing up and demanding that companies be more inclusive across all of these different vectors, because that is a change that I can see in a lot of the hiring data on The Muse which is, a few years ago, there were a small group of people who were saying, “I want to work at a more diverse and inclusive workplace.” It was often people from these different backgrounds, women, people of color, who ... the burden was on them to push their employers.
“When it comes to inclusion, it’s up to the CEO.”
Kathryn Minshew: I think that obviously we have a long way to go, but it’s been interesting to me seeing that a lot of people are starting to say, “Wait a second, I don’t want to go work for a company that isn’t committed to inclusion and diversity and belonging.” Even if I am a white man or perhaps I’m a white woman and I care not just about gender diversity, but also diversity of ethnicity, orientation, et cetera, and that is having, I think, a really big impact. And so, to your point about bottom up, it’s been neat for me to see that employees are starting to really demand better of the organizations that they belong to.
Ellen Pao: Yeah. I think when I talk to kids in college, and I don’t know if they call them kids, I’m so old, but when I talk to students in college, they’re very attuned to these issues. They don’t want to go work at a company that isn’t inclusive and isn’t diverse. They become that workforce that you mentioned that is pushing for change. It’s interesting because I think the future generation, even as you say, if they’re not part of like the group of women or nonbinary people or people of color, who pushed for change in the beginning, you now see a lot of students from more monolithic groups, white students, male students who are interested in working in inclusive environments with diversity, because they think it’s a better experience and they’re not looking for homogeneity. That, I think, will force CEOs to make change. I think the smarter CEOs and the more value-oriented CEOs are seeing it today and getting started, that’s hard to say early, but before I think everybody will be pushed into it.
Kathryn Minshew: Yeah. Exactly as you said, we’re seeing the impact on not just the numbers, the makeup of who’s in the door, but also the environments that companies are creating to support them. To that point, one topic that I’m personally very passionate about is going up against unconscious bias. You’ve spoken a lot about this and the impact it can have on people at work, but we’d love to just very quickly, hopefully most of the people listening to this podcast are very familiar with what unconscious bias is, but would you mind, for anyone who isn’t, just quickly explaining what is unconscious bias and what are things that people or companies can do to reduce the impact of unconscious bias at work?
Ellen Pao: Yeah, so unconscious bias is the idea that people bring all sorts of pattern recognition and ideas with them based on their experiences or based on things that they’ve seen or just an ignorance that results in a lot of bias in their decision making. They carry with them their experiences and ideas that impact their actions.
Ellen Pao: What a lot of companies are doing is this unconscious bias training to help people recognize the fact that they have this bias and that it may impact how they review their coworkers or employees in performance reviews, or how they talk to or otherwise interact with their coworkers, or who gets promoted and who gets different kinds of menial tasks because they have this assumption that some people are better than others based on their race or gender or other identity attributes.
Ellen Pao: Kara Swisher actually said a few years ago in a conversation we had that she doesn’t think it should be called unconscious bias anymore because everybody now knows about it and everybody understands that there is bias in action throughout ... It’s because we’re human. We come with ideas and we come with biases and they affect our actions. We should stop talking about it as unconscious bias and just talk about it as bias, and what should we be doing to address the fact that everybody has bias, and how do we prevent it from causing people to make bad decisions?
Ellen Pao: I think it is important to acknowledge it. I think part of that, like making sure that everybody understands that it exists in everyone, is important, and then giving people tools to kind of understand where it can impact and how you can try to prevent yourself from experiencing it. I think there’s some programs where like before you do performance reviews, you might watch a video on unconscious bias or you might get a reminder that there is unconscious bias or a reminder about the training maybe that you did earlier in the year to kind of flag, like let’s make sure that we’re thoughtful about how we’re doing our performance reviews so that we’re not incorporating our own biases into this process.
Ellen Pao: I think the metrics part is also really important, to look at the metrics around ... If you look at hiring, like what percentage of your employees are coming from different demographics? What does that look like throughout the hiring pipeline? From the initial candidate pool to the candidate pool that gets invited to do a phone screen, to the candidate pool that gets invited to interview on site, to the pool that gets to the next round, to the pool that gets to the final round, to the pool that actually gets hired, to the pool that actually takes offers, accepts the offers, and look at each pool to see what the demographics are and then figure out like, where are you losing people?
Ellen Pao: Is it because you’re … If there’s some bias in the system, is it because of specific individuals who then need to be retrained or is it because your candidate pool isn’t actually as diverse in the ways that would get to candidates that you would actually hire? It’s thinking about like what metrics should you be looking at so that you can actually measure it, and then address it because you see the problems before they become baked into everything that you do.
Kathryn Minshew: Makes so much sense. I want to close out the podcast by asking if you would be okay sharing some advice with our listeners? Many people who are listening to this podcast have probably experienced or witnessed some form of discrimination at their place of work, either current or in the past. From your experience, it’s clear that there can be real risk to speaking up, but you’ve also often said that every voice can make a difference, which is a sentiment and a statement that I really believe in. For someone who might be listening, who is experiencing or witnessing discrimination, or a business leader who wants to ensure that discrimination has no place in their organization, what are one or two things that people could do to make a difference right now?
Ellen Pao: I think it’s important to assess like what is your comfort level, right? What is something that you could do, and then push out of that comfort level like a little bit, right? Maybe I’d be comfortable like telling somebody in private like, “Hey, what that person did to you, speaking over you during that meeting, was really terrible and that shouldn’t have happened.” That’s a good thing to do, to acknowledge that there is a problem and to support the person who experienced it, but then maybe the next time you can practice some things to say so that you can address it [in] real time when it can make a bigger difference, where it can hopefully prevent that person from being ignored and it can change the person who’s talking over people’s behavior.
Ellen Pao: Maybe you can practice saying, “Hey, let’s just let person A finish their thought,” “Oh, I think person A wasn’t finished speaking yet,” or, “Oh, wait a second, let’s get the rest of this idea. I think it’s a good one,” so that you can kind of practice like, “Oh, I’ve noticed something wrong happening, and what can I do that pushes me out of my comfort zone so that I can have the biggest impact on preventing it in the future or addressing it at the time?”
Ellen Pao: I think for a business leader, role modeling that behavior to show that it’s okay, it’s okay to speak up and call somebody out for interrupting, or for not including somebody in a meeting, or for not asking for somebody’s opinion in a discussion. It’s okay to kind of fix those problems [in] real time. Hopefully if it becomes more commonplace, people won’t feel as uncomfortable bringing it up and it won’t be as big of a risk.
Ellen Pao: I think just getting people used to having these uncomfortable conversations, speaking up, helping each other, because for the person who’s actually experiencing it, it’s a little bit awkward to say something about themselves potentially. They don’t want to get the blowback. They don’t want to be called a complainer. It’s more personal, or maybe it might feel more personal to call that person out. It’s much more risky than having somebody come in and help and be an ally. Thinking about how you can do that in a way that’s comfortable to you, or maybe not so comfortable.
Ellen Pao: Then for the person who’s actually experiencing the discrimination or harassment, it’s to tell somebody your story. Make sure that you are getting support. It doesn’t have to be reporting it to HR or to your manager at first. It’s who are you comfortable talking to about [it with] and making sure that you’re getting the validation of the fact that you have had this bad experience happen to you, and then figuring out what you want to do, what you’re comfortable doing, what you are able to do. For some people it’s hard to take a risk with their jobs because they have a real need for that job, because they might not be able to transfer jobs. It may be that they have other financial obligations to their families or because they have school debt, but to kind of think about like where are you, can you save money to get out of that job at some point, and what can you speak up about, and is that comfortable to you? If not, how can you get out of that job as soon as possible by either looking for another job or trying to learn another skill so that you can move to a place that allows you to meet your financial needs but isn’t as toxic?
Kathryn Minshew: Yeah, and I think it’s so interesting too. I mean, we see this in some of the data and user feedback from The Muse, but people are really starting to vote with their feet. As you said, not everyone can leave a job that’s toxic right away. I think that it’s really important to be cognizant of that, but it is interesting to me seeing how employees are really doing more research and starting to demand that companies perform better, that companies are more serious about discrimination. We have a long way to go so I don’t want to be overly optimistic about the state of things, but I think it is really powerful when people move on because it makes it more difficult for those organizations to attract and keep great people in the future, which in and of itself is a strong business incentive for companies to step up their game. I love it and I think that makes a lot of sense.
Ellen Pao: Yeah. That’s why I’m so excited about being on this program because I think The Muse and everything that you’re doing is really important and it’s part of changing that conversation and changing kind of the information gap that exists so that people can make informed decisions and really hopefully have better experiences.
Ellen Pao: I know you were early to talk about your experiences as a female founder, especially with your name attached to it. I think you were the first, so thank you for that because it takes that first person and that first spot is really uncomfortable and gets attacked. Kudos to you for pushing through too.
Kathryn Minshew: The fact that that was so threatening to people back in like 2012, 2013, 2014, I mean, shows you the environment that we were all in.
Ellen Pao: Yeah, it was that like even calling out the problem, it’s not even pointing fingers, it’s just that there is a problem, was so threatening, right?
Kathryn Minshew: Yeah. I know. At least we’ve moved past that. I can’t say we’ve made as much progress as either of us would probably want, but at least we moved past the faux, “There’s no problem here. Problem? What problem?”
Ellen Pao: Or “I don’t believe you,” where like you’re making this up, you’re crazy, you have sour grapes, or whatever.
Kathryn Minshew: Yeah, exactly.
Ellen Pao: I think that’s like significant progress. It is so far from where we need to be, but at least women aren’t being shamed and humiliated and discarded as much anymore.
Kathryn Minshew: Yeah, for just saying real things that have happened to them.
Ellen Pao: Yeah.
Kathryn Minshew: Yeah. With that, I hate to call this to a close because this has been really great, but Ellen, thank you so much for joining us today and being so open and sharing so many kind of good pieces of advice and recommendations. For anyone who’s listening and thinking like, “I want to know more,” where should people go?
Ellen Pao: We have a website at Project Include. It’s at ProjectInclude.org. We have a Medium publication, Medium.com/ProjectInclude, that shares all of our recommendations and our advice, and it also has some profiles of leaders who are really committed to diversity and inclusion and also some first-person stories about the experiences that others have had.
Kathryn Minshew: Amazing. Well, thank you again so much for joining us. For everyone listening, thank you for tuning in. I’m Kathryn Minshew and this is The New Rules of Work.
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