Amber Quinoñes, of BBG Ventures, an early-stage venture fund that invests in diverse founders, has done the maths to confirm what many knew, but very few have cared to correct: that much of the funding the venture capital industry puts behind “diverse founders” goes to white women.
Thank you to Emma Hinchcliff and Joseph Abrams for including this in their work over on Fortune.com - read more here now.
“seed stage is a critical place to improve these statistics. We can’t meaningfully change the outcomes of venture capital at the exits if we’re not meaningfully changing the inputs at the early stage” Amber Quiñones
This affects all of us. Don’t let the acronyms and flash deter you.
Venture Capital simply represents another type of funding, for small and growing businesses. Imagine a bank dedicating a scheme to giving out loans to diverse founders, but 79% of how much they lend was going to white women:
Would it sound like they’re doing their job?
Typically most VCs are interested in the fastest growing and most easily scalable businesses, which used to mean tech. However, any viable business, with the potential to achieve that demonstrated by backing from its customers and its community could consider this Avenue.
Or at least they should be able to.
This model and option for funding becomes mute and irrelevant if specific schemes meant to create that access for diverse founders only actually care about gender diversity (as necessary and vital as it is).
We know, random and blind distribution of (financial) resources is inefficient. The world would stop if we didn’t have a sensible system for funding the most necessary and economically viable ideas.
But the world is full of many people, with many needs, and just as many people with the ideas and potential to serve them.
We would bet these people look and live lives as diverse as these needs.
How do you feel about this? Let us know in the comments or on instagram.
Team MWHQ.