The flurry of news—from open letters, to apologies, to media exclusives—about racial and gender imbalances in Silicon Valley, the self-proclaimed tech innovation capital of the world, has sent shockwaves across the community. In June, for instance, the New York Times ran a story that shone a light on the corrosive culture of sexual harassment in the tech startup scene. This reality has affected the community’s workforce: Many women and minority entrepreneurs now seem to be turning away from Silicon Valley, launching startups away from the epicenter of innovation.
All of this speaks to a key question: What might this unfolding workforce shift mean for underrepresented entrepreneurs across the country?
To understand the change afoot, it’s helpful to get a snapshot of the tech landscape. And what we see, regrettably, is that for many underrepresented entrepreneurs, the above grim news isn’t surprising. There’s a reason why the Silicon Valley investor community has been called a “good old boys network.” This is also borne out in the numbers. Data shows that women-led companies receive less than 5 percent of all venture capital funding, that African-American and Latino founders receive only 1 percent of funding, and that just 0.2 percent of it goes to black women founders. Compare this to the fact that tech companies led mostly by white, male founder receive over 97 percent of all venture capital funding, and the landscape becomes particularly bleak. With data showing that almost 45 percent of total global venture-capital investment resides between San Francisco, San Jose, Boston, New York, Los Angeles, and San Diego, you’d think that only white men and people who live in California or northeast America are capable of being a tech entrepreneur or raising venture capital.
For an industry that lives off of and trumpets disruption, it’s time for it to disrupt its own patterns of entrenched bias and elitism.
Fortunately, women and minority entrepreneurs aren’t sitting idly by. Over the past three years, Silicon Valley has seen the rise of underrepresented entrepreneurs such as Tristan Walker, founder and CEO of Walker and Company, and Morgan DeBuan, founder and CEO of Blavity, both of whom have become success stories of black entrepreneurship.
But what about underrepresented entrepreneurs in middle America and in the South? Look no further than Janice Omadeke, CEO of the Mentor Method, a Washington, D.C.-based social enterprise that curates mentor matches in the area, or Kansas City-based Davyeon Ross, co-founder and CEO of Shot Tracker, a platform that brings elite-level analytics to the masses. Out of Austin, Texas, there’s also Vi Nguyen, founder of Homads, which is a marketplace for homeowners to do month-to-month property rentals.
Janice, Davyeon, and Vi may not (yet) be household names or reside in Silicon Valley or have raked in tons (or even any) venture capital, but that’s not stopping them from succeeding in their respective cities. Their passion for success is just one of the reasons why at Change Catalyst, an organization that empowers diverse, inclusive, and sustainable tech innovation and of which I’m the co-founder, we’ve created the Hidden Entrepreneurs project to showcase and tell the stories of underrepresented entrepreneurs across America.
Yet this is only an initial step on the path to nurture tech startup inclusivity in the broadest sense. To sustain momentum, it’s crucial to keep our eye on the ball—and harness the power of our ever-changing demographic landscape.
You’re probably wondering: Why does this focus on underrepresented entrepreneurs matter? In the 2017 research report, Zero Barriers: Three Mega Trends Shaping the Future of Entrepreneurship, the Kauffman Foundation writes that “turbulent shifts are shaping the future of entrepreneurship to be dramatically different than what it is today, or was in the past.” Indeed, race and gender aren’t the only ways that entrepreneurship is changing. Age, too, is anticipated to play an important role in the community’s future. And as highlighted above, entrepreneurship growth is happening outside of traditional tech hubs, while at the same time technology is allowing startups to scale up and grow at faster rates and generate more revenue and jobs than ever before. It’s therefore prudent for entrepreneurs to be mindful of how the tech ecosystem is changing to be in a better position to be the startups of tomorrow, today.
As the tech industry in Silicon Valley starts to reflect on its history of exclusion, we’re seeing a burgeoning development of underrepresented entrepreneurship across the country. The new epicenter for startups won’t be Silicon Valley; there won’t be an epicenter at all, actually—innovation will be spread across the country. And fueling this innovation will be entrepreneurs who are diverse and creating inclusive cultures and businesses, jobs, and hope within their communities.