Year of the "Bro IPO": Women are MIA from companies looking to go public
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Welcome to the year of the Bro IPO: Men make up an overwhelming majority of executives at companies recently looking to go public, a new analysis finds.
Why it matters: It's the latest sign that the decade-plus push for gender diversity inside corporate America, already facing a backlash, has all but collapsed amid the anti-diversity policies of the White House.
The big picture: There's been plenty of anecdotal evidence that companies were turning away from diversity.
- The new analysis from board data firm Free Float Analytics is among the first to provide concrete evidence of that shift.
By the numbers: Men comprised 86% of the executives at companies that filed IPOs in the first seven months of the year, according to an analysis of Securities and Exchange Commission data. That compares to 63% for all of 2024.
- Men comprised 84% of board directors, compared to 76% the prior year.
- 27% of the companies looking to go public have no women at all on their boards; half have no female executives.
Zoom out: The data points to the possibility for a rapid change. As of a 2024 report, women held 30% of board seats among companies on the Russell 3000, which represents 3,000 of the largest U.S. companies.
What theyr'e saying: Adding women and people of color to boards and executive teams is now "considered a negative," says Damion Rallis, cofounder of Free Float Analytics, who drew attention to the trend on his podcast Business Pants. Fortune reported an earlier cut of the data.
- "I think people have bought into this notion that the 'meritocracy' means that women are less qualified than men," and that's giving cover to companies that never really cared in the first place, Rallis says.
- It's not a matter of qualifications: What typically happens is that men tap male-dominated networks for both funding and hiring, he says.
- And men don't always make an effort to look outside familiar circles.
Where it stands: "Today's wave of IPOs across tech, finance and healthcare looks a lot like those of 10 or 20 years ago when it comes to gender representation," says Karen Walker, a longtime tech executive, who has helped firms like Uber and Virgin America prep for IPOs.
Yes, but: There's more to gender equity than simply counting up the number of women at the top.
- "We are looking beyond representation," says Christine Cappabianca, who manages the Global Woman's leadership fund for Impax, an asset manager focused on sustainable investing. The firm is using measures like employee reviews to consider a company's culture and how it treats women.
- And they've seen more investor interest this year. "I think it is a way for kind of people to express frustration with things like they can't control in broader society, they can vote with their dollars or talk with their dollars."
Flashback: The lack of women founders and leaders inside startups was considered a longstanding problem for years. For the past decade or more, under pressure from investors, media and lawmakers, the numbers started shifting.
- Goldman Sachs even announced in 2020 that it wouldn't help take a company public if it didn't have at least one woman and at least one person of color on its board of directors.
- The bank tossed the rule in February, as the legal risks intensified.
- There's still interest from companies going public in diversity, says Tony Fratto, Goldman's global head of communications. But "it's less." On the investor side, interest is mixed, as it's typically been, he adds.
The bottom line: When it comes to gender dynamics, startups have gone retro.
