Debunking the Myths of Racial Equity: What Entrepreneurs Need to Know
Grow Your Business, Not Your Inbox
I remember having a brief conversation with Rev. Jesse Jackson at the White House during the confirmation of Patrick Gaspard as ambassador of the United States to South Africa in 2013. Our dialogue occurred after our Kingonomics Access to Innovation, Entrepreneurship & Investment conference during the 50th Anniversary of The March on Washington for Jobs and Freedom. Albeit brief, the conversation was about the importance of working together to focus our efforts on authentically diversifying Silicon Valley tech companies as a precedent for the rest of the nation’s “tech world’ to follow.
That same year, we launched Opportunity Hub, the nation’s largest Black-owned tech hub and co-working space in downtown Atlanta, GA. Within a three-year period, we launched two more campuses in Atlanta to serve the city's emerging Black tech ecosystem and watched more than 20,000 people enter the doors of OHUB to attend our tech and startup related meetups and events.
The next time I saw Reverend Jackson would be at SXSW in 2015 after his fireside chat with Van Jones. Tech companies were just beginning to release their diversity numbers in response to the specific and strategic requests of Jackson and other minority shareholders of some of the world’s largest publicly traded tech companies.
Since that time across America, there have literally been thousands of conversations, panels, pop-ups, dedicated keynotes, breakout sessions, convenings, research, white papers, pilot initiatives, inclusion grants, etc. dedicated to diversity in tech. Yet, for the most part, we haven’t seen much national sustained traction on what truly matters. In actuality, it seems as if we are going backward while experiencing glimpses of success via the outlier stories or new pilot program pressers.
Perhaps by debunking some myths about diversity, equity and inclusion amongst entrepreneurs, we’ll see more measurable outcomes in the space.
Myth #1: It’s about diversity and inclusion and belonging.
Well sort of, but not really. Yes, “representation”, “having a voice at the table” and “feeling good” about being at the table are important. However, having the opportunity to build the table from nothing and equitably “eat from the table” once its set is what it’s really about. More so than diversity and inclusion, it’s all about equity, racial equity in particular.
As the late Dr. Roosevelt Thomas, Jr. suggested in his writings and work, representation and relationship management are just the beginning stages of creating racial equity in the workplace. Creating a culture of belonging in the company is nice; but in many cases, it’s only that -- nice.
It doesn’t automatically guarantee parity in income or equity for Black, Latinx or women team members. Because of the racial wealth gap, when you negotiate the lowest compensation package under the auspice of protecting shareholder value, you are actually advancing income and wealth segregation as a result of your firm’s innovation density. This is why Microsoft is investing an initial $500 million in affordable housing in the Seattle, Washington Puget Sound region.
America is steadily becoming a majority Black and Latinx nation. It’s critically important for all entrepreneurs (i.e. the job creators of our era and the future of work in the fourth industrial revolution) to focus on achieving racial equity in our companies and communities as early as possible. Just imagine for a moment if racial equity in the company and community would have been a day one priority for Microsoft and other tech companies like it.
This is accomplished by attracting and equitably compensating all of the members of your team with fairness and transparency. This is sustained with corporate governance policies focused on fairness and equity for all.
Myth #2: Diversity, equity and inclusion can live and thrive in one part of a business.
The plethora of diversity and inclusion conversations and articles circulating throughout the startup ecosystem has many founders, angels and VC’s anxious to be more diverse and inclusive. Almost every six months, we’re reading about a new software company promising unbiased hiring.
These are good things -- very good things. Yet, your efforts will yield minimal results without an actual game plan (short and long range) to operationalize racial equity in your business -- at any stage. When this happens, you and your team may become discouraged. You begin thinking there just isn’t much of a talent pipeline, or that the talent didn’t want to work at your company. Ultimately, as my colleague Karla Monterossa, CEO of Code2040 says, “we must think beyond pipeline change and think systems change.”
To experience sustained success in diversity, equity and inclusion, startups have to operationalize and fund racial equity across six core areas of their business:
Corporate governance: Ensure that there is racial equity amongst your cofounders (when possible), investors, formal advisors, key team members, early hires and interns. Establish, enforce and incentivize policies and procedures that advance racial and gender equity for all in your organization.
Human resources: Be intentional about hiring Black and Latinx talent at all stages. Partner with organizations like OHUB, HBCU@SXSW and Rework to identify, develop, source and hire technical and technical sales talent. Hire from historically black colleges and universities, Hispanic serving institutions, tribal colleges, technical colleges with updated curriculum and coding boot camps.
Procurement: Hiring small businesses and other startups of color to provide key business-to-business services for your company directly impacts the traction, growth and new permanent job creation in communities of color. Make a commitment to ensure that your vendors and suppliers match the changing demographics of America and beyond.
Innovation: Developing inclusive innovation initiatives like HBCU “solvathons” and inclusive centers for innovation on HBCU campuses. Fund pre-accelerators, accelerators, incubators, pitch competitions and venture funds for founders of color.
Go to market: Intentionally allocating resources to reach Black & Latinx customer markets via targeted media, conferences, festivals and organizations. The African American and Latinx American buying power are in the trillions of dollars.
Impact: Reinvest in the future development of the ecosystem at all levels. Fund coding, technical sales and entrepreneurship schools. Fund conferences, festival and events focused on Blacks in tech. At OHUB, we've branded this company process as DEIS for Diversity, Equity & Inclusion As A Service.
Myth #3: Only large companies and organizations have to worry about racial equity.
To be honest, waiting until your company is very large before launching an authentic diversity, racial equity and inclusion initiative is actually too late. At that stage, companies are often reacting to some type of diversity “scandal” about their lack of inclusion, an uncovering of facts by the media as in the recent pay disparities at Oracle or an incident that forces the company to react. This often results in the launch of a crisis management PR campaign constructed by firms that lack any deep understanding of how racial equity is achieved in the workplace. Many times, this comes off as inauthentic and creates further mistrust and distrust.
The better path is to build a DEIS from the start. Yes, building something from nothing is hard enough but incorporating innovative and cutting edge best practices for racial equity during this early stages of company building has been proven to yield better product development. McKinsey has found it yields a higher return on investment and economic output.
The state of current affairs in our nation presents an amazing opportunity for high-growth startups to take the lead in the development of authentic diversity, (racial) equity and inclusion systems, processes and initiatives throughout their business.
Leverage this multifaceted operational approach as you create your startup’s unfair advantage in your respective industry and as you aim to raise more capital, hire the best talent, create better products, build new market channels, do good business, grow, scale and change your industry, community and world.
Being intentional about racial equity from day one is the best approach. However, let me say this: Not starting when you were a startup doesn’t absolve a large companies role and responsibility in rising to the occasion to set a new precedence of the importance of creating authentic diversity, racial equity and inclusion. In reality, their commitment to financially supporting these types of initiatives at the highest level should be a priority.
Will it be easy? Heck, no! But don’t be afraid to begin. As Dr. Benjamin Elijah Mays said, “The tragedy of life is often not in our failure, but rather in our complacency; not in our doing too much, but rather in our doing too little; not in our living above our ability, but rather in our living below our capacities.”