Last week we announced our latest Techstars Seattle cohort, nine great companies pursuing important innovations across a wide range of sectors. And while I’m proud and excited about the companies we selected for this year’s class, I’m ashamed of my failure as Managing Director to attract a more diverse mix of founders to the program I run.
At Techstars, we have committed ourselves to expanding opportunities for women and underrepresented minorities in the entrepreneurial communities we serve. More importantly, I am personally committed to overcoming my own unconscious bias and going out of my way to make the Seattle startup ecosystem a more welcoming and supportive place for founders who don’t match the usual startup stereotypes (i.e., white or asian men from privileged backgrounds with technical degrees from elite colleges).
I’m personally committed to this work because I believe it’s the right thing to do, and helps build the kind of society and economy that I want to live in and see my children grow up in. But that alone is not enough. My job as an investor is to find exceptional opportunities to drive returns for Techstars and for our limited partners (the fund investors whose money we invest). As early-stage investors, we typically commit our (and our LP’s) capital to teams that have yet to ship a product or make a sale — we’re fundamentally betting on people and their human potential as leaders and organization-builders.
After more than a decade of very early-stage investing, I have developed some strongly-held opinions about what it takes to succeed as a founder – not just to start a company, but to persist through all the skepticism, setbacks and turns of fortune’s wheel on the long road to entrepreneurial success. A few years ago I wrote a blog post distilling those views — you’re welcome to read it, but I’ll save you a click by reposting the punchline here:
“Founders aren’t born but made, first by the hurt the world gives them and then by their lifelong fight to forge that hurt into something beautiful and strong.”
If you wanted to go looking for people who have learned to persevere in the face of opposition, who have spent their whole lives being told – either tacitly or explicitly – that they weren’t good enough, you wouldn’t start your search among the economic or cultural elite. You’d go looking for people who have achieved extraordinary things despite their background and environment, people who have learned to keep pushing not because it was expected or encouraged, but because it wasn’t and they wanted to prove that they were better and stronger than anyone ever imagined they could be.
So my commitment to working with founders from underrepresented groups isn’t just a way for me to feel good about myself or earn PR points for Techstars. It’s a deliberate strategy to back the most ferocious and relentless founders I can find, the ones who will walk through walls to deliver for their teams, their investors and themselves.
I am failing in this work. And I’m asking for your help.
Since I took over the Techstars Seattle program in 2014, I and my team have built partnerships and programs designed to increase our visibility in underrepresented communities and reduce barriers – structural, perceptual or emotional – that have prevented founders from those communities from applying to our program. (A huge amount of the credit for any gains we have made goes to Jaren Schwartz, Program Manager for Techstars Seattle and a quietly ferocious leader of these efforts).
And our efforts are producing results. At every step in our application and selection funnel except the last – and most important – one, we have significantly improved the participation of both applicants and decision-makers from diverse populations. Here are a few stats from our last selection cycle:
- 43% of applying teams had a female co-founder or core team member (up from 19% in 2016)
- 25% of our first-round callbacks had a female co-founder or team member
- 30% of our finalist companies had a female CEO or co-founder
- Final investment decisions were shaped by a 10-person investment committee made up of four women and six men.
- We offered slots in the cohort to three woman-led companies (of a planned 10-company cohort)
- Only one of those companies, Silene Biotech, accepted our offer (one accepted an incubation offer from an industry incumbent; the other decided they weren’t ready to take full advantage of the program and wanted more time to work on their business fundamentals).
A few observations about the results above:
- Women founders are our *strongest* area of progress toward our diversity goals – we have made no meaningful progress in attracting African-American and Latino founders (we don’t ask for or track data about gender identification or sexual identity in our application process).
- Even though our funnel and process participation is improving, we — and the responsibility lies entirely with me and not with anyone else on my team — have consistently failed to convert our offered slots in the class to founders of diverse backgrounds. Two years running we have fought hard to sell women founders on our program, only to have them ultimately choose other options.
Einstein famously said that the definition of insanity is doing the same thing over and over but expecting different results. I’m committed to achieving different results in our diversity recruiting, so I need to start doing some different things. I’ve begun a process of engaging with some of our biggest fans and most vocal critics (often the same people) about our diversity strategies, and will add more structure to that work as we learn more about where we’re going wrong. But I’m also asking you – anyone who reads this post and wants to offer ideas, share best practices or just express an opinion about our diversity efforts and goals – to email me directly at chris.devore_at_ techstars.com to open that conversation to participants outside our existing network.
I never expected it would be easy to break down the many barriers to entrepreneurial success for women and other underrepresented founders, but I did expect to deliver better results in my own program and in our own community. I am doubling down on this effort, and I’m grateful for help and advice from any quarter to move us farther, faster.