Tech Startup: Katica Roy Makes Closing the Gender Pay Gap an Economic Issue
Denver's Pipeline helps clients analyze cloud-based data from human capital systems
INITIAL LIGHT BULB:
Founder Katica Roy worked for SAP, Kaiser Permanente and other large organizations before she devised the plan for Pipeline. She was a guest on a radio talk show in 2015 when the host asked if the gender pay gap would ever close. Her answer — “Not until we make it an economic issue” — underpinned the startup’s launch on April 4, 2017, Equal Pay Day.
The company now has three full-time employees and a network of more than 20 contractors.
IN A NUTSHELL
Equal pay “can’t just be the right thing to do, it has to grow the economic footprint of the business,” Roy says.
Pipeline helps clients do this by analyzing cloud-based data from human capital systems, looking at who is hired and how they are paid, along with employee feedback, development and training. “It’s their data, and it’s our algorithm,” Roy says. “In each of those buckets, there are different decisions you make and different processes you go through. We intercept those decisions. We provide recommendations on those decisions and we quantify the economic value of those decisions.”
That allows human-resources professionals a better perspective. “Every time there’s a recommendation they can actually see if that moves them toward gender equity or away from it,” she says. “It actually operationalizes gender equity.”
Roy says research has shown that companies that close the pay gap by 10 percent achieve a 1 percent to 2 percent increase in revenue. “Fundamentally, diverse teams produce better results,” she says. “Because you have different voices in the room that are actually heard, that leads you to better products.”
Pipeline delivers clients a forecast that “gives them a projection of what investments they can expect to make and what returns they can expect to get, and when.”
SendGrid is a beta client that signed on with Pipeline in April 2018. While the company has made progress in diversifying its technical and leadership teams since 2015, the aim is to do even more, says Pattie Money, chief people officer for the Denver-based enterprise email provider.
“SendGrid will use Pipeline’s data-driven solution to give us the insights we need to ensure an environment where there is true equity for all across all employment dimensions,” Money says.
Roy notes that clients need to commit. “Closing the gender equity gap is a long game,” she says. “You don’t install the Pipeline system and a month later close the gender equity gap.”
She adds, “Equal pay is equal pay for equal work. It does need to be solved, and we solve it, but the bigger issue is the very leaky pipeline of women.”
In health care, for example, 73 percent of entry-level hires are women, but only 35 percent of top-level executives are women. “That’s the issue,” Roy says. “Even when women are 73 percent of the labor force, they don’t make it to the top. Men are promoted on average 30 percent more than women.”
Roy says “unconscious bias” is largely to blame. “It’s actually how our brains work. Close your eyes and picture a CEO. What do you see?”
Another guiding dynamic: There are currently about 5 million unfilled jobs in the U.S. “Companies are struggling to find talent,” Roy says, noting that nearly 60 percent of college graduates are now women. “That’s a problem when your most educated cohort is not staying in the workforce. That’s the crux of the economic issue we’re trying to solve.”
Nearly 4,000 U.S. companies have made public pledges for pay equity. “That’s our target market,” Roy says, noting that most early clients are large enterprises.
After closing a seed round in spring 2018, Pipeline will likely initiate a Series A financing round in 2019, Roy says.