Silicon Valley Venture Capital Has a Diversity Problem

Erasing overt racism or sexism isn't enough.
We need to be practicing overt inclusion.

I’m writing this post from the Austin airport, headed home to Oakland from SXSW. Before pulling out my laptop to compose this, I read a post on Medium that named me as one of three black women known to have raised millions in venture capital. The article began with the startling fact that less than .1 percent of venture capital in the United States is invested in black women founders. I’m not sure what sub-percentage of these are women in tech, but it doesn’t really matter when the overall numbers are so abysmal.

The problem isn’t a lack of compelling women of color to invest in; it’s a system in Silicon Valley that isn’t set up to develop, encourage and create pathways for blacks, Latinos or women.

Don’t just take my word for it — listen to industry leaders interviewed for a USA Today story on the Valley’s lack of commitment to diversity. Jessica Guynn reports that “venture capitalists tell [Mitch Kapor] all the time that they are “color blind” when funding companies. He’s not sure they are ready to let go of a deeply rooted sense that Silicon Valley is a meritocracy.”

Let’s start with a basic belief that folks aren’t practicing overt racism or sexism. I honestly believe that’s true. Unfortunately, it’s not enough. We need to be practicing overt inclusion. To realize the country’s full potential, and to benefit from the mosaic of perspectives and contributions in an increasingly diverse nation, we simply have to do better. We have to be intentional.

Let’s talk about merit for a moment. Very few of us get anywhere entirely by ourselves — because we earned it. Most of us who achieve any level of success had people who believed in our potential before we had track records. We had someone willing to take a chance on us, and quite often we had others willing to make a connection or do an introduction on our behalf. These are not to be taken for granted; most people who look like me don’t get those kinds of breaks. It doesn’t make them any less smart, talented, hardworking or innovative.

I graduated from UC Berkeley and got an MBA in finance from Yale. I’ve been a successful serial entrepreneur, and I give back to many communities through my membership on boards and other contributions. My resume is long, and people often describe me as “successful.” I suppose being “the one” is supposed to make me feel special, or better than others, but it doesn’t. Just when I’m tempted to revel in my success, the reality that the chances of scaling my company are stacked against me hits me in the face. In my day-to-day reality, I can’t afford to spend time thinking about the opportunities I may have missed because of who I am.

As an African-American lesbian in the U.S. who has raised $12M for my tech company so far, I have many different feelings when I read about Silicon Valley capitalists not investing in people like me. I wonder how many more studies need to be commissioned to show companies are more successful with diverse leadership and workforces. Silicon Valley touts itself as the most innovative site of productivity in the world, yet Forbes has extensively studied how lack of diversity diminishes innovation. Silicon Valley needs to wake up and move beyond the same group of players.

There is a mountain of research that shows funding only people who are white and male diminishes innovation and reduces profitability.

Not that profits are everything. In addition to profitability, I am fueled by the belief that I am on this planet to have some impact — to share opportunity and great technology with others. And not just a few others — hundreds of millions of others. I know I can open doors, in person and online, but I wonder how much longer it will take for the doors of venture capital to open to me, and to the many others like me, who are exceedingly qualified.

I wanted to offer a voice largely unheard by the VCs in Silicon Valley. I don’t live next door to the polite white men who tout the virtues of meritocracy while pouring billions of dollars into their buddies’ companies. They live in insulated little worlds, and it’s hard to see color when there is none around them. Funding one’s friend isn’t inherently bad … but I challenge them to look outside their circles and also support other types of businesses — like those owned by women of color. It might be convenient to use their limited experiences to convince themselves we don’t exist. But we do.

I think the anemic flow of capital to the diversity of society is a symptom of an inherently biased country and a world that shows its true nature by inefficiently investing in and giving opportunities and power to familiar, heterosexual white men. It’s a hoarding of the resources that could spawn creativity and expanded opportunities for everyone. And it’s a diminishing return.

The costs of not capitalizing on the black women like me who build excellent products are exponential. Evidence shows it’s harder for women in the culture of profound sexism in Silicon Valley, and when we are successful, it means we have put up with a lot more than our counterparts who freely see capital flow in their directions.

In my fields of learning and education technology, the cost of not connecting our products with the majority of people in the U.S. is tremendous, and that majority is made of an incredibly diverse population, not just black women. The price we pay is the disenfranchisement of millions of people who can’t access an educational product that could transform the world.

The problem of diversity in Silicon Valley needs fixing. The solution is to realize the wealth of opportunities lost by not funding the many amazing ideas of women of color.