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It seems that there is no shortage of venture capital firms declaring their solidarity with the Black Lives Matter movement. That’s wonderful, so let’s capitalize on this energy with meaningful action. There have been some excellent articles written about ways to increase investment in Black and other underrepresented founders, and I wanted to share a couple of practices, from the perspective of a white male investor, that have helped Beta Boom broaden our deal flow and invest inclusively. Half of our portfolio startups are led by Black founders, and 80% are led by founders from all underrepresented groups.

One of the biggest factors determining the level of investment in underrepresented founders is deal flow, or the leads that investors see. Currently, the investment community primarily relies on warm introductions from their professional network. It does not take much brainpower to realize that investors’ networks tend to mirror themselves. So if you are a white Stanford University alumnus, there is a fair chance that your network is not replete with economic and ethnic diversity. If your own network lacks diversity and you rely on your network for deal flow, how can you expect to see startups led by diverse founders? …

About

Sergio Paluch

Helping to develop the next wave of tech founders via Beta Boom (betaboom.com).

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