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These Women Could Be the Tech Industry’s Next Great CEOs—or Not

March 21, 2018, 10:30 AM UTC

To say Lexi Reese is a get-things-done kind of person is an understatement. To navigate the demands of her leadership role at fast-growing startup Gusto, a cloud-based provider of payroll and human resources software for small businesses, she maintains her schedule with an elaborate spreadsheet called “¿Dónde está Lexi?” that meticulously categorizes exactly how she spends her time. The document is broken down into four overarching values and five quarterly priorities, ranging from “drive revenue” to “personal.” Each priority contains a set of actions and details of her plan for execution, including who’s involved, format, and “cadence,” from weekly meetings with her sales team leads to twice-a-month dates in the city with her husband. A separate tab lays out her actual schedule, down to 15-minute increments in color-coded glory.

A few years ago, when she was ready to leave Google after an eight-year stint, Reese applied the same meticulousness to her job search, identifying four criteria (including a $100 billion addressable market and a “stretch” role), and logging, in fine detail, every hour she spent talking with Gusto.

Reese’s habits show the organizational acumen, drive, and perfectionism that you’d expect from a CEO. But she isn’t Gusto’s chief executive (though, according to her notes, before getting the job she did spend 21 hours, including a three-hour hike, meeting with the guy who is). She joined the company in October 2015 as chief customer experience officer. And last year she was promoted to chief operating officer—a role that’s becoming almost as important as CEO at some of the tech world’s hottest companies.

Courtesy of Intercom

There’s a famous saying: “If you want something done, give it to a busy person.” You might just as easily say, “Give it to a COO.” ­Reese is part of a growing cohort of high-­profile, high-performing chief operating officers who command increasing respect and attention in Silicon Valley. She’s also emblematic of another commonality among these stellar seconds-in-command: An unusually large percentage of them are women.

Consider the female COO appointments at buzzy tech companies in the past 12 months: Belinda Johnson at Airbnb, Jennifer Berrent at WeWork, Maëlle Gavet at real estate and technology firm Compass, and Sara Clemens at video-streaming platform (and Amazon subsidiary) Twitch, to name just a few. In late February alone, Savannah Sachs took on the role at beauty subscription service Birchbox, and Francoise Brougher, a former top exec at mobile-payment company Square, made headlines when Pinterest announced she would become its first-ever COO.

These women join a very long list of tech-­industry COO incumbents: Marne Levine at Instagram, Amy Bohutinsky of online real estate giant Zillow, Etsy’s Linda Findley ­Kozlowski, Claire Hughes Johnson of Stripe, Pam Murphy at enterprise software firm ­Infor—there are too many to list them all here. And, of course, there is the person who is arguably the spark for this recent movement: Sheryl Sandberg, who left Google to become Facebook’s COO exactly 10 years ago.

The corporate world—and the tech industry in particular—has a lot of trouble minting female CEOs. But when it comes to the COO role in this sector, women are enjoying a golden age. The rise of these operations masterminds comes at a pivotal time, given the sector’s abysmal dearth of female leaders and the recent revelations of the pervasiveness of “bro” culture. And their growing representation is especially noticeable in the universe of high-growth tech startups, where rapid growth, high financial stakes, and the glare of publicity give the role extra heft.

Benjamin Rasmussen

As is true with all C-suite positions, there are still far more male COOs than female COOs in the tech world. Among the 50 highest-valued privately held “unicorn” companies, for example, of those with COOs, 70% have men in the post, 30% women. But that 30% is a striking contrast to the mere two out of 50 CEOs in the same group who are female. (While there are female founders outside the unicorn top 50, the numbers remain scant.) Compared with the 6.4% of Fortune 500 companies that had female CEOs in 2017, or to the 10.7% of Fortune 500 COOs who are women, that 30% looks even more significant. And the fact that this C-suite shift is happening in the most dynamic sector of our economy gives advocates of gender parity in the workplace plenty of cause for hope—even as the minuscule number of female CEOs reminds them of the stubborn obstacles that remain.

To explore the female-COO phenomenon, Fortune talked to 19 female current or former COOs, a handful of male COOs, recruiters, venture capitalists, and other management experts. While many female COOs were reluctant to call this a trend, those who closely follow such things have noticed the phenomenon. “I’ve thought about the ‘woman thing,’ ” says Bohutinsky, who was named COO of Zillow in 2015. “I’ve noticed it myself too.” “It’s so superficial,” laments Martha Josephson, Palo Alto–based partner at executive search firm Egon Zehnder. “But it is definitely a thing.”

The COO role is famously hard to define, largely because it is a shape-shifter: It varies company by company, sector by sector, and CEO by CEO. Yet whatever its shape, its scope of influence is undeniable. It is almost always the role closest to the CEO, and the one with the broadest cross-enterprise oversight. And throughout the annals of corporate America, it has been a stepping-stone to the top spot.

Courtesy of Rent The Runway

According to a study by executive search firm Crist Kolder of 673 companies in the Fortune 500 and S&P 500, it is the most common path to the top job: Upwards of 40% of sitting CEOs were promoted from the president/COO role. James Quincey, the current CEO of Coca-Cola, was COO under Muhtar Kent before taking over the top job; Kevin Johnson was COO before becoming CEO of Starbucks. Today’s highest-profile COO-turned-CEO? Apple’s Tim Cook. This path is just as common for women at large corporations: Of the 36 women who have held Fortune 500 CEO jobs in the past 12 months, 15 were previously COO, including Lockheed Martin’s Marillyn Hewson, Campbell Soup CEO Denise Morrison, and Guardian Life Insurance CEO Deanna Mulligan.

Given this pattern, some obvious questions emerge. Will the current wave of women COOs in tech give rise to a new, more robust pipeline of female chief-executive candidates, teed up to take top spots of their own? Or does the COO role risk becoming a glass ceiling in itself—a position from which accomplished women leaders stoke the industry’s growth, in a perpetual supporting role, without breaking into the CEO boys’ club?

Any study of the COO is, by definition, hard to tackle. By one important measure the role itself is actually in decline. According to Crist Kolder, the percentage of Fortune 500 and S&P 500 companies with a COO has fallen from 48% in 2000 to 29% last year. The decline began after the recession of 2001 and accelerated again after 2008, as financial pressures led some companies to eliminate the role and spread its duties among other senior management. There has also been a shift toward other executives becoming more operationally focused, especially the CFO, says managing director Josh Crist.

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More recently, however, the COO position appears to have made a comeback. Pfizer, restaurant giant Darden, and British American Tobacco have all created a COO role in the past few years, and retailers Kohl’s and Target added the position in 2015. And at the companies that do maintain the title, the role is still very often seen as a stepping-stone for the next CEO. Indeed, most big-company CEOs, men and women, are groomed internally, with most coming from roles with so-called line responsibility, or oversight of a business unit responsible for making money—typically, president, division president, or COO.

It’s also almost always true that the COO spot occupies a space higher than other C-suite positions. “It’s a way to designate someone’s extreme seniority relative to others without making them the CEO,” says Jane Edison Stevenson, vice chair, board and CEO services, at Korn Ferry.

So what to make of the evidence that the COO position—and its significance—is becoming so much more prevalent in the tech sector? For an answer, it helps to zero in on the field commonly known as “high-growth tech”—the universe of relatively new tech companies, ranging from proto-unicorns to publicly traded giants, that have seen their number, size, and influence soar in recent years.

For one thing, the founders of these companies are now much less likely to step aside—or be replaced—as they grow. It wasn’t so long ago that it was standard practice for investors and boards to move the founders out of the CEO’s chair and replace them with heavily credentialed corporate leaders: Think Meg Whitman at eBay or Eric Schmidt at Google. The high-powered import was seen as a sign that the company had gotten big enough that it was ready for “adult supervision.”

But that tide started to shift in the 2000s. The change accelerated after Marc Andreessen and Ben Horowitz launched their eponymous venture capital firm in July 2009 and made central to their mission a vow to keep founders as CEOs. Their rationale: Most of the great companies in the tech industry, including long-term leaders like Microsoft, Intel, and Apple, were run by a founder for a long period of time. As competition among venture capital investors for stakes in promising companies became more intense, being “founder-friendly” became table stakes.

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There’s a drawback to founder-friendliness, however: It has meant that young entrepreneurs, typically with a product or engineering background but often with little to no management experience, have found themselves running companies. Enter the COO.

“Silicon Valley has been living in this world of the founders being God on earth,” says COO Gavet of Compass, who was previously COO of Priceline (now Booking Holdings) and before that served as CEO of Ozon.ru, known as the “Amazon of Russia.” “Suddenly the COO makes a ton of sense,” she says. “He or she has done his or her fair share of team alignment, process building at scale, and all the things that usually bore to death the founder, but then you get to keep the founder. So everybody’s happy.”

At the same time, the role of CEO in all sectors has evolved to become much more external. CEOs today are expected to be public figures, with a robust social media presence, conference gigs, worldwide customer tours, and the like. While they’re pressing the flesh, someone needs to run the shop.

These shifts have made the role of the second-in-command more pivotal. But there’s one additional factor that can’t be overlooked: the hiring of Sheryl Sandberg as chief operating officer of Facebook. When a 23-year-old Mark Zuckerberg hired Sandberg in 2008 from Google, where she had been VP of global online sales and operations, Facebook was not making money and not sure what its business model should be. Within three years the company was profitable and had grown from 130 employees to 2,500, while users had grown 10-fold. Sandberg brought her experience in building Google’s enormously successful ad platforms to Facebook, helping to monetize the nascent company, grow it, and professionalize it. She took on everything from marketing to culture to policy and helped steer Facebook through its IPO. On paper, Zuckerberg and Sandberg were an odd couple—he the socially awkward engineer, she the über-­successful, well-­connected veteran of McKinsey and Washington, D.C. But their partnership stands at the core of the company’s success. (Sandberg declined to comment for this story.)

Almost immediately, other companies tried to replicate the model. “I’ve been asked a dozen times for ‘a Sheryl,’ to the point where my eyes glaze over,” says Josephson, the partner at Egon Zehnder. “All the investors need ‘a Sheryl’ as if it’s something you can order from Amazon.” Sure, I’ll just find you some OTHER executive who helped build a half-trillion-dollar public company, created a global brand around women’s empowerment, and is an oft-rumored presidential candidate.

Still, the success of the Sandberg-­Zuckerberg model has stuck, making companies all the more amenable to bringing in women as candidates. A few other factors are contributing to this new eagerness. There’s now a strong pool of seasoned female executives who have spent their careers in tech working almost all the way to the top, along with a heightened concern about diversity in tech’s C-suites. And not least, there’s the fact that the skills that, rightly or wrongly, women are perceived as excelling in—multitasking, consensus building, caring less about the title than the meaning and mission in their work—lend themselves particularly well to the critical No. 2 role.

Lexi Reese, COO, Gusto; StacyBrown-philpot,
 CEO and former COO, Taskrabbit; Gillian Tans, CEO and former COO, Booking.com; Beth Ferreira, former COO, Fab
; Maëlle gavet, COO Compass

Many see all of this as good news, for the obvious reason that it means women are reaching new levels in executive ranks. “It indicates how many talented women there are that can really make a business work,” says Rosabeth Moss Kanter, professor at Harvard Business School and chair of the Harvard University Advanced Leadership Initiative.

“If the most senior role available is the COO role, and a lot of them are going to women, to me that’s a huge win for women,” agrees Jana Rich, founder of San Francisco–based executive search firm the Rich Talent Group.

If these optimistic words sound like a setup for a big “but,” you’re onto something. As senior as it is, the chief operating officer role is often a counterpoint to the CEO in ways that keep the COO far behind the scenes. And that tension can be particularly strong in Silicon Valley, where the mystique of the (usually male) creative-genius founder holds tremendous sway. The CEO has the vision; the COO executes on that vision. The CEO is external-facing; the COO is internal-facing. The CEO holds on to the make-or-break responsibilities of product and engineering, while the unglamorous work of running everything else falls to the COO.

Alfred Lin, a partner at Sequoia Capital who was previously COO and chairman of Zappos, refers to it as the balance of “fire and ice”—the founder/CEO brings the entrepreneurial spirit and passion for bold ideas, but “you also need the icy-cold skills of management,” he says. “That tension is the tension that makes for great companies.” But for a COO with sights set higher, that dynamic can present challenges: The closest thing to the top isn’t the top. For those whose goal is to become CEO, being COO may risk being seen as a “silent sidekick,” Stevenson says.

To be sure, these kinds of roles can still be extremely fulfilling—and influential. Michelle Zatlyn is the COO and a cofounder of web-performance and security company Cloudflare, and her partnership with cofounder and CEO Matthew Prince fits this yin-and-yang model. “If I had to say what my job was, it’s like the chief glue officer behind the scenes,” she says. That includes setting up the company’s organizational structure, establishing a centralized planning process so that everyone knows the company’s goals and can monitor progress, and scaling all of that as the company has grown to more than 600 employees. She also tackles anything thorny or problematic. “Anything that’s black-and-white, our team just solves,” she says. “What comes up to me is all the grays.” She often finds herself thinking back to a conversation she had with her high school basketball coach. “She told me once, ‘You’re never the highest scorer, but the team always does better when you’re on the court.’ ”

But not every COO enjoys the kind of status within a company that a cofounder like Zatlyn has earned. For COOs—male or female—who are brought in from the outside, especially at startups where the founder is young and inexperienced, the role can sometimes comprise a combination of crisis manager and teacher. (Not coincidentally, many female tech COOs are several years older than their CEO partners.) There are many stories from Facebook’s early days about Sandberg and the company’s investors instructing Zuckerberg on topics like how to handle public speaking and when to shed his hoodie. And even the most high-profile COOs are accustomed to jumping in wherever needed, whether that means choosing the size of the Christmas tree that will sit outside headquarters or tracking down the CEO’s phone charger (both tasks that COOs mentioned in this story have tackled).

Taken to extremes, this dynamic can put the female COO in a role akin to chief of staff or, at worst, babysitter. That’s the role that advocates for women in leadership are most eager to steer clear of. “I’m always going to come at this from the point of view of how much strategic influence are women exerting, and that being the sort of be-all and end-all of what we’re trying to achieve here,” says Sally Helgesen, leadership expert and coauthor of the forthcoming book How Women Rise.

Karen Peacock had some of these concerns in mind when she left Intuit to seek a more entrepreneurial role. As a senior vice president, she had responsibility for Intuit’s 500-person, $2.5 billion small-business unit, including its QuickBooks brand. As she started the job hunt, several of the advisers she consulted gave her the same advice: “Whatever you do, don’t become a COO.” Those advisers thought Peacock was ready for a CEO role—and indeed, she says she was offered several such positions. But she also considered COO opportunities, and as she did so, she studied the reasons the role can be problematic. She found that the COO-CEO partnership tended to work better when it was based on shared values, where the two have different skill sets and the CEO is willing to “divide and conquer,” and where there are clear expectations on how to handle disagreements. Before deciding to join Intercom, a customer messaging platform, as COO, Peacock spent five months getting to know the cofounder and CEO, Eoghan McCabe.

To be sure, plenty of Silicon Valley’s female COOs wield influence over vision and strategy. Sources say Jen Berrent, the COO of WeWork, negotiated the company’s recent $4.4 billion investment from Japanese giant SoftBank. At Etsy, Kozlowski has responsibility for everything revenue-generating and customer-facing. Gavet of Compass says that “every big decision comes from a conversation that [she and CEO Robert Reffkin] have had together.”

So what are these second-to-none COOs like? They tend to be focused, efficient, and quick learners. They are experts at multitasking—and even more so at its second cousin, “context-switching,” which is essentially single-tasking but switching from task to task a lot. (“I can context-switch like no one you’ve ever seen,” says Johnson of Stripe.) Maureen Sullivan, COO of fashion-rental startup Rent the Runway, says a key trait is the ability to “fly at 50,000 feet and dive down to five feet or five inches and not feel turbulence.”

A little over a year ago, Cameron Herold, founder and CEO of the COO Alliance, an organization for No. 2 executives at small and midsize companies, ran an experiment in which he gave 60 entrepreneurs and 60 seconds-in-command a personality test designed to reveal how they like to start new projects. The findings: 95% of the entrepreneurs shoot from the hip, Herold says, and 95% of the COOs came up as “fact finders.” “They’re almost the perfect cleanup act to the entrepreneur,” he says. He says the group has seen women rise from 20% of its membership to 35% in the past year. (For an in-depth look at COO support groups, see Fortune.com.)

After speaking with 19 of them, I can say that these women COOs are also, to put it bluntly, ballers. They’re on time or early. They come to a conversation with prepared and thoughtful points. If you forget your charger, they may have one already plugged in and waiting for you. They talk fast. I got the sense that if I handed them my reams of notes, they would turn my story around overnight and hand it back to me fully drafted.

Like Peacock and Reese, many of them took a meticulous approach to the search for their current jobs. They have studied what works and doesn’t work. According to Kozlowski, clarity in what the CEO needs is the most important element for success. What doesn’t work: “When your job description is ‘I just need help,’ or ‘Can you do all the things I don’t want to do?,’ then you know you’re in trouble.”

Are these changes to the COO role creating a pipeline of female CEO candidates? Most sources I spoke to are optimistic. There is plenty of precedent, after all: Consider the Fortune 500 women who have been promoted from COO to CEO at “old economy” stalwarts, including, recently, Michelle Buck of the Hershey Company. Other recent notable female COO-to-CEO promotions include Gillian Tans of Booking.com, TaskRabbit’s Stacy Brown-Philpot, Nasdaq’s Adena Friedman, and SoulCycle’s Melanie Whelan.

Many sitting COOs hope that the post-Sandberg generation has raised the profile of the role and the women who hold it. “You see it in both the public and internal sphere not as a ‘secondary’ role or as the quiet or background role,” says Bohutinsky of Zillow. “That has set an example for seeing more women in this role and imagining more women in the CEO role—and, for more women starting to imagine these roles for themselves.”

Not everyone agrees. “I don’t think it’s a layup,” says Beth Ferreira, managing director at FirstMark Capital, a New York City venture capital firm, who was previously COO of e-commerce company Fab and ran operations in the early days of Etsy. “I know many COOs—men and women—who have been told as things evolve, ‘the CEO job is yours,’ and it doesn’t happen.” She says she sees men still chosen for stretch roles far more often than women.

But Ferreira and others point out that, thanks to the #MeToo movement and the exposure of the downsides of male-­dominated companies and industries, we are at a turning point when it comes to opportunities for women. Ferreira says she has been approached about four CEO roles in the past two months; in the four years prior to that, she says, she got very few, or else they weren’t appealing opportunities. (“They were, like, companies that were going to hit the wall at any moment.”)

Korn Ferry’s Stevenson says she has noticed a shift on the part of boards to start considering positions like COO more frequently as developmental roles toward a CEO seat. But she also notes that differences in the way women lead may mean that boards have to look at female candidates differently. Women, for example, “don’t pound the door down to CEO,” she says, a trait that “doesn’t make her a better or worse CEO candidate, it’s just different.” A 2017 Korn Ferry report Stevenson coauthored, “Women CEOs Speak,” which surveyed 57 current and former female CEOs, found that only 12% knew they wanted to be a CEO—and that more than half gave no thought to being one until someone explicitly told them they had the potential.

For some women executives, a similar dynamic has been in play around the COO position. Stacey Cunningham, COO of the New York Stock Exchange, says that NYSE president Tom Farley had to ask her three times to take on the role of COO before she said yes. “It’s that classic thing,” Cunningham says. “I focused on the skills I didn’t already have.”

But if the Fortune 500 women CEOs who have moved up from the role are any indication, the COO job can indeed be an effective primer. Almost every COO I talked to says she has gotten inquiries for CEO positions. Maëlle Gavet believes that within a few years, tech industry boards will have a substantial cadre of high-powered and well-rounded female COOs to choose from to fill CEO seats. The main question, she says, will be whether the boards trust them. “We’re about to find out. We’re literally going to find out in the next two to five years.”

Some boards are already answering the question. Wag, an on-demand dog-care service, recently lined up a $300 million investment from SoftBank. In tandem with that move, Wag’s board decided to replace its male cofounder and CEO with a more experienced executive.

The new CEO? Her name is Hilary ­Schneider.

Additional reporting by Abigail Abrams and Jonathan Chew