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Deborah Farrington ’72: Dare to Take Risks
The offices of StarVest Partners, a venture capital firm co-founded more than 20 years ago by Deborah Farrington ’72, are located high above Lexington Avenue in New York City. In the group’s conference room, on walls, counters and tabletops, are framed copies of magazine covers and articles featuring Farrington, with headlines like “Accidental Pioneer” and “Top Female Technology Dealmaker.”
Resting discreetly on a shelf is perhaps one of her most cherished career mementos: a commemorative medal from the 2007 listing of the software company NetSuite on the New York Stock Exchange.
Back in the late 1990s, NetSuite (known then as NetLedger) was a fledgling California start-up. With annual revenues of about $100,000, it provided software applications that allowed companies to move their accounting and financial services online—a revolutionary idea at the time. Farrington and her partners recognized the potential behind NetSuite’s software-as-a-service business model long before other investors and, in 2000, led a $20 million round of investments to help grow the company. When NetSuite went public seven years later, its stock price doubled all initial estimates and by the end of the first trading day the company was valued at $1.8 billion, scoring the second most successful public offering of a tech company since Google. Farrington—who as a child made regular trips to Wall Street with her father—was at the New York Stock Exchange that morning to ring the opening bell. “There are some moments that you won’t ever forget, and that is one of them for me,” she says. “It felt as if I’d come full circle.”
The NetSuite deal was a career-making moment. Not only did it secure StarVest’s status as a big-league player in the often unpredictable (and unforgiving) world of venture capital, it also established Farrington as a smart, bold and forward-thinking risk taker—one of only a handful of women venture capitalists and one of the first to make her mark in the technology industry. In 2008, Forbes magazine named her to its Midas list of top venture capitalists. She was one of only two women to make the cut that year. In a profile, Forbes described Farrington as the country’s “top female VC” whose interests in “entrepreneurship and women’s issues” were helping to reshape the industry. She made the list twice more, earning the magazine’s informal title of “Queen Midas.” In 2018, Farrington received the Medal for Achievement in Financial Services from the Foreign Policy Association. After a long career that has seen one success after another, she is now in a position to ease the path for other women investors and entrepreneurs trying to make it in an industry that has not always welcomed them.
Farrington is the rare woman at the top of a successful venture capital firm. “It's difficult for women to break in,” she says. “There's still so much work to do.”
Evan Goldberg, the founder and chairman of NetSuite, met Farrington in 1999. Their partnership—and friendship—grew as they began working together on the NetSuite deal and Farrington took a seat as lead director on the company’s board. She quickly became Goldberg’s trusted confidante, staying, as he says, laser-focused on the financials while also bringing a human touch to the investment deal that would eventually lift his company to prominence. Together, with Goldberg leading management and Farrington leading the board, they built a strong team, and in 2016 their work culminated in the sale of NetSuite to tech giant Oracle for $9.4 billion. “Debby was a steady presence, and her thoughtful advice was critical in the key decisions we made over the years,” Goldberg says. “One of the most important things she taught me was how important long-term relationships are—how to balance the cold-eyed bottom line with the human elements of business.”
Her success, he says, should have been a signal to other women that a thriving career in venture capital was possible. So far, though, change in the industry has been slow. According to PitchBook, an online platform that collects and measures investment data, only about 17% of top-level positions at venture capital firms around the world are held by women.
Farrington winces at these statistics. “There is still so much work to do,” she says. “Venture capital is still a bespoke business. Many firms are founder-run or are second generation–run, which means they continue to be founder-dominated, which often translates into old boys’ club. It’s difficult for women to break in.”
These days, Farrington sees more women ascending the commercial banking side of the financial services industry, but fewer finding high levels of success in investment banking, which often feeds the venture capital and private equity pipelines. The talent is there, Farrington says, but the problem is retention. One of the reasons, she believes, is that many women just aren’t interested in the long hours, intense competitiveness and macho culture that often overshadows competence. “It can be a slog,” she says. “Long nights, no time off, lots of stress. Many women look at that and decide it’s just not for them.”
Change, she says, needs to start at the top with both a pledge from industry leaders to “become 100% intolerant of sexual harassment” and a shift away from the traditional corporate culture where work takes precedence over any kind of personal life.
“Firms must recognize that they need to become friendlier to women and align their culture with what’s important for women today,” Farrington says. “Providing a level playing field along with simple things, like a weekend off or more flexible hours, can go a long way in attracting the best and brightest women.”
As Farrington observes, when women aren’t at the table making decisions about investments, money does not flow as readily to women entrepreneurs; communities and society overall suffer when women’s ideas are overlooked. According to PitchBook, businesses founded by women received just over 2% of venture-backed funds last year. That means women entrepreneurs are missing out on millions of dollars in investments every year simply because they are not on the radar of the mostly male venture capital firms. “It’s time that more women had a seat at the table,” Farrington says. “We deserve it, and we should demand it.”
Farrington’s own career trajectory shows a woman willing to embrace risk and make opportunities work for her. She would often say to herself, “I am prepared, so why not me?” In person, Farrington exudes optimism, enthusiasm and confidence. One gets the impression that, in her hands, no obstacle is insurmountable and no goal is out of reach. She is happy to talk about her own path to success with the hope that in doing so she might inspire other women to follow her. “I’ve waited 40 years for things to change,” she says, “and I don’t want anyone else to wait another 40 years. If what I’ve accomplished can help other women, that is a legacy I would be proud of.”
Farrington grew up in New Jersey, the second of three daughters. Her parents, Betty and Dick, were active volunteers in their community and instilled in Farrington and her sisters an obligation to give back. Her mother was dedicated to Planned Parenthood, the League of Women Voters and Church World Service. Farrington remembers regularly accompanying her mother to church to pack boxes of used clothing earmarked for families in need overseas. “I was taught that you had a duty to always look out for the welfare of others,” she says. Her father had a profound impact on Farrington’s personal development. While society in the early 1960s was encouraging girls to grow up to be good wives and mothers, Dick Farrington was sending his daughters a very different message: Be leaders. “He made us feel that we could do or be anything,” Farrington says. An executive at Lehman Brothers, her father also introduced Farrington to the world of finance.
Farrington was 10 years old when her father first took her to his office in New York City as her reward for getting all A’s in school. As part of their tour of the city, he walked her down the street to the New York Stock Exchange. “I was fascinated by all the action taking place and decided on the spot that it would be fun to be part of it,” she says.
When Farrington arrived at Smith in the fall of 1968, the country—and the campus—were on the cusp of major change. The Vietnam War was raging, the women’s movement was reshaping society, citizens were fighting for civil rights. At Smith, the old rules were falling away seemingly overnight. During Farrington’s first year, for example, students wore skirts to dinner, men were not allowed in students’ rooms and there were restrictions on going away for the weekend. All of that changed by the start of her sophomore year. “The house presidents met and voted out all the rules,” she recalls. “Suddenly, there were no rules at all. It was a new day. It was absolutely extraordinary.”
Farrington was inspired to take advantage of the opportunities suddenly available to her. “I came alive intellectually at Smith,” she says. “Smith has a tradition of producing pioneers. We felt in the early ’70s, this was our moment. It was our duty to embrace that tradition and be pioneers in this new age. That became an important theme in my career: wanting to try the next new thing as a woman out in front.” During her junior year, instead of going to Europe, Farrington opted to attend Dartmouth College as part of a new 12-college exchange program that opened up some of the all-male Ivy League schools to women for a year. She was one of 75 women chosen to participate (Meryl Streep was another), and the experience exposed her to the different work styles of men and women. “The men focused on how fast they could get their work done, while the women were more focused on going into depth and really exploring a subject,” she says. “I find that comparison holds true today.”
In her senior year, Farrington, an economics major, applied to Harvard Business School and got in, but decided to defer so she could work for two years. She took a job in Chase Manhattan’s Global Credit Training Program. “As a woman, I wanted to be as prepared as possible with good credentials and did not want to be held back because I didn’t have a degree or a certain level of experience,” she says. “I never wanted anyone to say, ‘You can’t do this because you don’t have that credential.’”
The mid-1970s were exciting times for women interested in business and finance careers, Farrington recalls. Companies were actively recruiting at women’s colleges, which resulted in a wave of women heading to graduate-level business schools and to Wall Street. When she started at Chase, 25% of trainees were women, and about 10% of her class at Harvard Business School was made up of women. “People, companies, were very open to change,” she says. “They wanted to try new things; they understood that diverse perspectives and a whole new pool of talent could only help their business.”
That wasn’t necessarily true in the late ’90s, when the economy took a big hit. “When things got tough, women were pushed out,” Farrington says. “There were fewer opportunities for them, and it seems to have been slow coming back from that.” There is some encouraging news, though, as evidenced by recent initial public offerings and funding of women-led companies such as RealReal, Stitch Fix and PagerDuty. “In the first half of 2019, 15% of IPOs were led by women, more than any previous year,” Farrington notes. “But I would like to see it much higher.”
As her career advanced, Farrington did occasionally bump up against the proverbial glass ceiling, but she never let it stop her. When a new opportunity presented itself, she would step forward with a simple “I can do that” (or often to herself, “I’ll figure it out”). That attitude led to stints at Merrill Lynch and at Hong Kong’s Asian Oceanic merchant bank, where she led the worldwide corporate finance division, directing the bank’s major investments in a range of Asian and U.S. companies. Every once in a while, though, she would hear her father’s mantra— “be a leader”—and wonder why she was working for other companies when what she really wanted to do was start her own. She took a step toward that goal in 1993 when a group of friends from Harvard asked her to join them in their plan to start an investment firm called Victory Ventures back in New York. “I started with a desk and a phone and the promise of some capital to build the company from there,” Farrington says. She became president and CEO, and during her tenure invested in and was chair of a staffing firm that grew revenues from $17 million to $250 million.
After a few years, she decided the time was right to start her own firm. Always on the lookout for a new opportunity, Farrington saw a trend emerging as more businesses sought to move their operations online. She did the research and wrote a thesis: Business software delivered as a service over the internet was the wave of the future. With this idea as her guiding star, she joined with a younger friend she had been mentoring, Laura Sachar, along with another woman and man, and launched StarVest Partners in 1997. “We were three women and one man, not because we were determined to start a women-majority firm,” Farrington says, “but that was who had the talent we needed.” At the time, the firm was the largest majority-women-owned venture capital firm, with initial assets of $150 million.
Multimillion-dollar moves like the NetSuite deal helped distinguish Farrington as a visionary investor in the burgeoning e-commerce, software-as-a-service and internet marketing sectors. She was one of the only women to carve out a niche for herself in this area. “Debby is tough-minded, resilient and brilliant,” says Ron Daniel, former worldwide managing partner at McKinsey & Co. Inc., who has known Farrington for 35 years. “It was—and is—a male-dominated world, but Debby’s career proves that women can succeed, which she has done over and over again.”
Now Farrington is using her influence to encourage other women to enter the financial industry. In particular, she is making it easier for women to start their own businesses, which she believes provides the perfect training for a career in venture capital. At Harvard Business School, she has endowed a fellowship for women entrepreneurs, and at Smith she, along with Tim and Melissa Parker Draper ’77, helped launch the Draper Competition for Collegiate Women Entrepreneurs. The competition has just entered its sixth year, attracting more than 50 teams and awarding over $200,000 in scholarships and prizes. “Starting your own business provides an environment in which you can thrive, take risks and gain confidence—all characteristics of a great venture capitalist,” she says.
She also spends a lot of time mentoring young women. Her StarVest partner, Laura Sachar, credits Farrington with showing her and other women that building a successful firm is possible, even when the odds seem stacked against you. “Debby is the kind of person who is willing to roll up her sleeves and do the work,” Sachar says. “She has set a terrific bar and has helped me stretch myself. I have learned so much from Debby.”
Farrington’s commitment to supporting women in business extends to her civic priorities. For a long time, she served on the board of Opportunity International, a multinational NGO that grants microloans to women in Africa and Central America. In addition to heading up the Investment Committee on Smith’s board of trustees, she is currently advising a new all-women venture capital firm that invests only in products and services that advance women’s achievement. “Women investing in women—and also men investing in women: This is what it takes to effect change,” she says.
For Farrington, the goal is securing women’s economic empowerment. “As women, it is important that we guide our own destinies, gain financial independence and have a real voice for change in society,” she says. “Having women more involved in more parts of the economy will create a better society by enabling all the best minds and talent to be involved.”