Many people believe that we live in a post-racial society — one where everyone is judged by their abilities and where race or gender never influence people’s assessment of someone.
I know this to be false.
In my field of startups, only 2.6 percent of all venture capital (VC) funding goes to Black or Latinx founders. When you dig deeper into the data, you discover an entire ecosystem that creates that outcome. It starts with the fact that the average white household’s net worth is $171,000, whereas the average Black household’s net worth is almost 90 percent less, at just $17,150. Considering that most startups are initially funded by family and friends, it’s unsurprising that many Black founders often don’t even have initial angel resources to get started.
Even if they do manage to raise enough money to get their venture off the ground, they still face an uphill battle. Eighty-one percent of all VC funds don’t have a single Black partner in their ranks. I’m convinced that when I was raising my company’s Series A, I faced discrimination as a result of this imbalance. Approximately 120 of the VCs that I pitched were white partners, and I received precisely zero term sheets from this cohort. Thirty of the VCs that I pitched were minorities, and I received five term sheets from them.
Era of leftover racism
I’ll be the first to admit: I’m half black and half Jewish, and the level of discrimination I have experienced over the course of my career pales in comparison to what my father faced when he was a working adult. It’s true that we live in a post-racial society, legally speaking — but we are still dealing with the generational remnants of a system built on inequality.
For that reason, I’ve coined the phrase “capitalism is the next civil rights movement” to embody my perspective on ending this era of leftover racism. I firmly believe that equal access to capital will finally dissolve the ugly remnants of discrimination in this country, reducing crime and expanding education outcomes by increasing opportunity. And it needs to be approached exactly like the civil rights movement.
Contrary to the spirit of the original civil rights movement is the sentiment in some pro-Black movements that success is a zero-sum game, that our progress will cost other races. It’s critical to frame Black progress as benefitting all America. I think of Malcolm Gladwell’s idea of capitalization rate, or “the percentage of people in any given situation who have the ability to make the most of their potential.” This is a fight to increase that percentage, not to muscle other groups out of a fixed number.
The vision continues
I’ve contributed to this modern civil rights movement by enduring years of struggle to get my company where it is now, but I know it doesn’t stop here. Right now, just 2.7% of top executive roles are held by Black people in tech companies. We’re changing that at The/Studio, where 22% of our leadership roles are Black, 22% is white, and the remaining percentage is Asian. We did that naturally, by seeking out top talent, no matter what it looked like.
That vision continues in terms of who we design our services for. Our latest service, Supplied, is an offering targeting female entrepreneurs, with over 60% of its customers representing minorities. Our vision for Supplied is to increase equality in the world by giving everyone the ability to purchase affordable inventory for their small boutiques. Originally, many of my colleagues didn’t see the value in pursuing this business — but I knew that there was a market out there, teeming with bold entrepreneurs just waiting for an opportunity.
Simply put, if all our citizens can make the most of their potential, the U.S. will remain the greatest country on Earth for decades to come. Building toward that is my goal.
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