Venture capital funding bias: Why VC business-as-usual must change
The bias in venture capital funding is stark: Companies with Black women at the helm get less than zero percent of VC funding.
What do you think when you hear the words diversity, equity, and inclusion (DEI)? Increasingly, employees and business leaders alike view the concept of DEI with excitement. To many, DEI efforts are one of the best ways to attract talented, hardworking employees from a range of backgrounds that make businesses a better place to work.
But some still carry implicit bias about DEI, whether it’s the gnawing fear that it will cost existing employees their jobs or disrupt the workplaces they’ve come to love.
People may know these thoughts are wrong – both morally and factually – and yet, they often can’t shake them.
The bias in venture capital funding is stark: Companies with Black women at the helm get less than zero percent of VC funding.
As a recent guest on an episode of Forward with Adam Grant, Rajkumar shared how the sportswear giant creates truly diverse, equitable, and inclusive employee experiences. She broke down the adidas approach to this concept:
It's Women's Equality Day, but it'll be 135.6 years before women and men reach parity on a range of factors, versus the 99.5 years cited in 2020.
For Rajkumar, it’s a big red flag when a company’s management teams lack diversity, specifically when this problem is chronic and longstanding. If attrition rates are high and people aren’t sticking with the business, it very well could be because of lackluster DEI efforts. Your company may find and hire great talent, but if you aren’t making them feel like they belong, they’ll leave.
She says it’s an alienating experience for employees to look around and not see anyone like them, whether it’s a reflection of their own race, gender, sexuality, or lived experiences. The visibility of employees with disabilities in the workplace is becoming increasingly important, too.
“We never think that we are lowering the bar here. What we are doing is widening the gate,” she says, explaining that the adidas approach to DEI enables more employees to begin their race from a fair starting line.
After listening to Rajkumar’s insights, I met with my friend and fellow HR devotee Enrique Rubio on LinkedIn Live to learn what he thought of the adidas approach to the employee experience. Rubio, founder of Hacking HR, said that many of our “gut feelings” about diversity, equity and inclusion are not to be trusted.
“One of the concerns from some business leaders has been, ‘Are we going to have to lower the quality of our hires if we become more diverse?’ And the answer is: totally no!” he says. “The way you address these unfounded concerns is with data.”
Rubio agrees with Rajkumar that it’s the role of HR to bust myths by using data that reflects the truth about DEI in practice. For instance, this data may reveal that employees who feel equal in an inclusive and diverse workplace provide greater long-term value as they stay with the company longer.
“A lot of the processes we run in HR, we have to bring data to the table and make sure that we are making data-informed decisions,” Rubio says. “They will just strengthen our case for more equitable, diverse, and inclusive processes in the organization. And they will add a layer of science to things that now we know are the right thing to do . . . but you add the data that proves that it is the scientific right thing to do.”
Learn how HR tech can improve workplace diversity and inclusion when paired with a strong corporate strategy based on equality.
Many leaders do not believe they have bias, so when they step back and take stock of the company, they see what they think are inclusive teams. HR needs to provide the data that says otherwise and makes the case for creating real progress in DEI. But how do companies get this data in the first place? Rubio says this is a challenge.
Employees need to feel safe to share information about themselves that truthfully reflects who they are and provides the key DEI metrics that the business needs. But if they don’t believe their employer is serious about protecting their identity, they may choose to keep this information close to the chest for fear of workplace prejudice.
On top of that, people are simply more conscious of who they let have their data – and why. Today, even employers need to have a good reason for asking about someone’s ethnic background.
Rubio suggests removing the mystery from HR’s data gathering efforts and adding new transparency. Let employees know why you’re gathering this data, what you plan to do with it, and how it will improve the employee experience.
The reality of being Black in corporate America: Out of the 500 biggest companies in the U.S., less than one percent have a Black CEO.
Everyone at a business stands to benefit from a better employee experience, so no employee should escape the reach of your communications related to diversity, equity, and inclusion.
“The rise of woman does not equate to the fall of man. I think we need to reassure our male counterparts of that because we absolutely have such a long way to go, and we can only do it with male counterparts’ help,” Rajkumar says.
Encouraging employees to become allies can also empower them to speak up when they see something that violates your company’s codes of conduct or ethics. If employees know you’re truly dedicated to DEI, they’ll feel safe to say something is wrong and protect their teammates.