Behavioral Economics for Leaders

CHAPTER 9Startups with a Larger Share of Women Last Longer

The staff of contemporary organizations is often diverse. Younger and older employees, old‐timers and new hires, people speaking different languages, people of different ethnic groups and genders. So what does the ratio of men and women in startup companies tell us?

As a young man, my father worked at a small company in the Western part of Austria. All his colleagues came from the immediate geographical area, spoke the same dialect, and were mostly males because the employment rate of women was still far lower than that of men back in those days. In the years after World War II, the word diversity was still totally unknown. Nobody would have understood the idea, widespread today, that it might be profitable for companies to have employees with diverse backgrounds when it comes to language, ethnicity, and gender. Since employees were far less mobile at that time, a high degree of diversity wasn't even conceivable and therefore couldn't have been seriously taken in consideration.

Today it's a lot different. In academia—where I've been working for more than 20 years—it has become natural that research teams are made up of individuals from diverse groups of people. My inaugural working group at the Max Planck Institute in Bonn in 2018 included three Italian women, two Austrian males, one Bulgarian female, one German male, one South African woman, an American male, one Norwegian man, one Croatian man, and one Indian woman. ...