Wed February 26, 2014
Do Tech Startups Need More Diversity?
Originally published on Thu February 27, 2014 7:56 am
MICHEL MARTIN, HOST:
This is TELL ME MORE from NPR News. I'm Michel Martin. We've spent a lot of time lately talking about the technology business and why more women and minorities aren't more present in those fields and how to get more diversity into those fields. But let's say you're already there. Let's say you're one of the people who already has the interest and the background and not only that, you're ready to do your own thing. Where do you go from there?
We wanted to have a conversation with a diverse group of people who are in the business of helping a diverse group of people get their enterprises off the ground. Jewell Sparks is the CEO and founder of BiTHouse, that's a group that helps connect technologists of color with entrepreneurs and investors. Also with us is Brian Dixon. He's an investment associate at Kapor Capital. That's a venture capitalist firm focused on companies that pursue social change. Also with us, Deldelp Medina, she's with the Latino Startup Alliance. That's a nonprofit group that connects Latino-led startups to support networks and funding. Welcome to you all. Thank you all so much for joining us.
DELDELP MEDINA: Thank you.
BRIAN DIXON: Thanks for having us.
MARTIN: OK. Everybody - so Jewell, let's start with you. Let's just - can we just briefly get your perspective on this whole question? 'Cause I know you've talked about this endlessly, but we do want to just set the table. We've talked a lot about underrepresented minorities. We're doing a whole series on women in tech through March. I just wanted to ask why you think there is still a lag here with these groups getting involved in tech, particularly when we know that there's a lot of entrepreneurial energy in those groups, at least before the recession started, you know, women and minorities actually had a higher rate, you know, of business development than some other groups. So why this lag in tech?
JEWELL SPARKS: I think that there's a lag just because of lack of financial resources that are available. And so also, if you're an entrepreneur, there's a lot of risk taking that's involved, and so that's also a issue for minority entrepreneurs.
MARTIN: Brian Dixon, your company actually focuses on investing in diverse tech founders. Why do you think there's a need for a group like yours, and your thoughts on just the broader question?
DIXON: Absolutely. So there's a couple barriers. I mean, one, technical teams. So looking at founding teams, you have to have somebody technical on the team to really build out the product. At this point, at least in Silicon Valley, you really can't get funded by just an idea. You really have to have a minimal, viable product or a working product and some traction as well. And then, two, I think it's really understanding the ecosystem of how to get introductions. What is the right time to pitch your business? And then, who are the people to pitch it to? There's different stages of investment, and you want to make sure that your pitch is tailored to the investor as well.
MARTIN: Deldelp, what about you? Thoughts on that?
MEDINA: Well, I think that one of the issues we have is, to kind of piggyback on what the two of you said right before, is that lack of capital is an issue, but lack of capital is an issue because most of our communities have a lack of capital. We don't come from wealthy people so being able to ask your friends and family for help and support financially is not a viable thing. And so if you're going to take a risk by being entrepreneurial, you're going to take a risk in such a way that you can actually perform and start bringing in money.
And so going back to looking at technical teams, the reality is that our pipeline, our folks that are actually trained to be able to build a minimal viable product, if they're going to have an opportunity, they're going to take it at a place where they have a steady salary, not a place where they're going - they're going to want to spend time and effort and money on something that might or might not happen. And so I think that those are some huge barriers that we try to address on a regular basis at Latino Startup Alliance, and that they're real for people. These are not just some sort of, like, airy fairy ideals. This is an actual everyday problem - money in the bank.
MARTIN: Well, you were saying, in fact, you know, that there's this narrative in the tech world that if you're smart enough and you've got the great idea, you can drop out of college, you can work out of the basement until you somehow make that next big idea work, and then you're a multimillionaire. So you're saying that that storyline is just, you know, it's kind of a fantasy for a lot of people. But you're saying that particularly, for people from particular backgrounds, it really makes no sense at all.
MEDINA: Yes, exactly. I mean, your ability to stop earning a salary, to take a risk on an idea is financially, sometimes, catastrophic for people. Let's just be clear about that. And those of us who have the ability to do that, it is emotionally difficult because it's - your family and your friends and your community kind of look at you and they are like, what are you doing?
MEDINA: ...Why are you taking such a huge risk?
MEDINA: Why don't you just get a job? What are you - what's your end goal here? And they don't really understand the possibility or the options that this can bring to your life and that it is an investment that you're making. And I like to think of this investment you're making on short-term in yourself in a way that you're not making for other people. And I think that, culturally, that's a lens that you have to take a look at and actually acknowledge exists as a barrier.
MARTIN: It reminds me of an earlier generation when, you know, sometimes an earlier generation of minorities or women or people of color wanted to go to professional school, say to be a doctor or a lawyer...
MARTIN: ...And family members would say, why don't you get a good government job? Like, what's wrong with you?
MEDINA: Yeah, or...
MARTIN: ...Or why don't you go to the factory? Or what's wrong, you know, what's wrong with you?
MEDINA: Work at - be a secretary. That's what my grandfather used to tell my mother. Like, why aren't you a secretary?
MARTIN: So, Brian Dixon, what's the business case for having more women and people of color leading tech startups?
DIXON: Yeah. So we look at it as an advantage. I mean, at Kapor Capital, in our impacting portfolio, 46 percent are women or people of color. I mean, founders from diverse backgrounds bring a different perspective, a different lived experience. You know, they really see problems and opportunities that others don't so we think of it as an advantage. I'll give you an example. One of our founders from Dominican Republic, Edrezio, created a startup called Regalii.
And he created it after sending money back home to his family. It uses SMS, and it really goes to paying the bills, to cable, to buying groceries, etc. And this was just out of his lived experience. He really saw a problem that, you know, no one else wanted to tackle in the that way he's tackling it, at a low cost solution because we really think, you know, it's about leveling the playing field. And diverse entrepreneurs see those opportunities.
MARTIN: Jewell, what's your take on how - on these affinity groups that have started up? That, you know, we've reported a number of people who participate in them. They're kind of focused. Very often, they're focused around people from particular backgrounds, like, there's - like Deldelp's group, that's the Latino Startup Alliance, and then there's an African-American group and I think there's probably an Indian-American group as well. What is your take on that? Do you think that that's productive or not?
SPARKS: I think that those groups are very productive because if you're going to take a risk, like becoming an entrepreneur and starting your own company, you really need to have a support system. And as Del mentioned before, you sometimes don't get that from your family. So I think these groups are very important to provide that support.
MARTIN: But is there a chance, though, that people are kind of replicating the kind of isolation that they're already experiencing?
SPARKS: Yes, I mean, that is true that they're doing that. But at the same time, I think now the groups are getting to a point where they're realizing, you know, after they go through the sessions of I'm not in this position or I wasn't hired on this leadership team or there's not many minorities in technology - I think now we're getting to the point where some of the groups are focusing and telling people within their network, you know, focus on what you want to be and where you want to go and how you are going to get there. And I think when - since we're in that space now, I really think that we'll see a lot of production and productive activities and entrepreneurs that are coming out and being more successful as well.
MARTIN: If you're just joining us, we're talking about building diversity in tech startups. Our guests are Jewell Sparks from BiTHouse, that's who was speaking just now, Brian Dixon from Kapor Capital and Deldelp Medina from the Latino Startup Alliance. You know, Brian, you know, there was a recent report on the Marketplace program that pointed out - public radio, of course - and it pointed out that it wasn't that long ago that Indian-Americans and immigrants were shut out of leadership in tech.
And now, of course, Satya Nadella has been named Microsoft CEO, and Indian tech thinkers are a force in Silicon Valley. Is there a lesson that other underrepresented groups can draw from that experience? Or is there - or is that just a unique set of circumstances, for example, that these entrepreneurs are not just, you know, players in their own right but they're seen as connected to another larger international market? I mean, is that the secret sauce or is there something else?
DIXON: Well, I'll start off with this. I mean, if you look at the - the degrees, right, computer science degrees, 9 percent were earned by African-American and Latino, right. So becoming more technical, looking at that achievement gap, those numbers really do have to rise. And that kind of leads to the next of kind of the access, right, of looking at the workforce it's about 7 percent Latino in tech and 6 percent in African-American in tech.
So there is a lot of work to be done, but the problem will be solved, right. And it's going to be solved from everybody working together. You mentioned a lot of partners. You think about who's out in the field of, right, of Hidden Genius, Black Girls Code, Latino Startup Alliance and Black Founders. Those are all organizations that are really helping to provide that support that Jewell mentioned earlier and also that network. So I think, going back to the original question, I think it's becoming more technical, right. And really starting as you leave those larger companies, right, and go off to start your own companies, that's really going to make the huge shift that we're looking for.
MARTIN: Jewell, what are your thoughts about that?
SPARKS: I think that's true. I think the demand is definitely going to be there. So in the future, I don't think as minorities we can say, oh, there's not a lot of minorities that are in technology because the jobs are going to be there. And the U.S. Bureau of Labor Statistics estimates that there's going to be about 8 million jobs that exist in the future, and on top of that, there's just going to need people to fill those jobs. But I think educational resources need to improve as well as we need to just encourage students earlier to get involved and have an interest in STEM as well.
MARTIN: Deldelp, what do you think?
MEDINA: Well, just a reminder to all of us that the reason Indian-Americans are in the position they are is because they created an organization to make sure that they're in that position. Indus was, you know, pivotal in being able to say, we're not just code monkeys. We're not just the IT guy. We're actual leaders. And we're going to help each other form associations to be able to create networks within ourselves so that we can be successful. And we at Latino Startup Alliance have taken a look at that model, and that's who we, you know, we aspire to be. It's, you know, it's not just - it isn't coincidence that, you know, Indian-Americans are in position as a power.
They actually worked at it and worked at it smartly. One of the things that I do want to remind people is that in terms of Latinos, like, we are some of the fastest adopters of technology across the board. Pew Hispanic says that we - you know, we love mobile, we love all of these things, but we can't just be passive consumers. We actually have to be active creators. And I think, like, all our associations by creating networks, it isn't just amongst people of color or women, that we're associating ourselves. You know, there's a lot of people that come to our meetings. I've gone to Black Founders meetings. We associate with each other because we see the opportunities that are out there. So you know, what Brian's saying is, like, opportunity - opportunity's out there, but we need to be savvier, more educated and better networkers with each others' and others for us to elevate our voices and our products.
MARTIN: Jewell, could you talk a little bit more about what we - about what Del was just talking about here, this - the question of what lessons perhaps can be learned from the Indian-American experience? I mean, is it - those networks, I mean, that whole networking thing is always tricky for, I think for minorities and also for women. I mean, when other groups kind of rely upon their networks, sometimes it's seen as valuable, but sometimes there's a backlash when people of color do it. I mean, I think that's some of the experience that President Obama's had. It's, like, oh, it's favoritism when you draw upon your network, but when other people do, then it's considered an asset. And I'm interested in how you navigate something like that.
SPARKS: Well, I think, like I mentioned before, I think having these groups are very important just for, like, a basic support network. But then I think you need to go beyond those groups, and you need to be more inclusive of other groups and other networks that are more mainstream because, for example, if I want to be in technology and if I know that maybe I'm not going to be able to obtain financing, maybe as a minority entrepreneur, I would want to have a cofounder that I know won't have as difficult of a time accessing financing. And so I think we're kind of at a point and a stage where we should be kind of proud with who we are, be really focused on what we want to do and just really try to find solutions of how to get there versus focusing on why we aren't there. So I really think inclusiveness is very important.
SPARKS: ...You can't just stay with your one group and then expect everybody to come towards you without you also going towards them.
MARTIN: Jewell, can I just ask you about this? Can I just push you on this point? I mean, this sounds of like a strategy from back in the day. I mean, I remember when John H. Johnson first went and was founding Ebony and Jet magazine. He made it clear that he had to have, he literally had to hire a white guy to go and get - and negotiate the building for him, and he pretended to be his building engineer. I mean, he literally put on some coveralls and pretended to be the building engineer inspecting the building for the building that he wanted to buy. Is that what you're saying? That you need kind of a front person or you need an outward face person? Is...
SPARKS: I'm not saying...
MARTIN: ...Who's of a different background? Is that what you're saying?
SPARKS: I'm not saying you need one, but I'm saying it can definitely can be useful. I've done that several times. There's a lot a people that I've done business with, and they really don't know who I look - or what I look like until, you know, once the paper's signed and maybe I'll go to meetings. But I have a diverse group of people that are on my team that, you know, they help in areas because like attracts like. So, you know, I'm definitely inclusive of people who are different.
MARTIN: Brian, what do you say about that?
DIXON: Yeah, I mean, I think about the teams that we fund, and it really comes down to we do want a diverse team. We also care a lot about, for teams that - what are they going to do in the future as far as hiring goes, right. And it also comes down to, you know, you think of it from the venture capital side of - VC's want to fund the best businesses, right. And for us, we also have the - we want to fund the best businesses but we want them to have a commitment to diversity, commitment to serving communities and really leveling the playing field. A lot of times, we do investments in education, and when we think about those teams, right, of, who are - we think about the students as well, right.
And how do you get a product out to a school that also is kind of a free and reduced lunch school and also a private school, right? So we want a product, and we wanted a team that's thinking about both of those parties. We don't just want a product that only works in the private school, right. And I think that goes back to the team, right, of if you have a team where, if everybody went to private school, right, it might get left out, right. So those different backgrounds I think is a key to having a team that's going to tackle all these issues because I think it's easy to say that start-ups aren't easy, and there's going to be a lot of challenges along the way. So that's where - that's where I'm at.
MARTIN: Del, let me give you a final word here, final word of wisdom.
MEDINA: Well, a final word of wisdom...
MARTIN: I'm asking for it. I'm not going to give you one, you're going to give me one. I don't have any for you.
SPARKS: Give it to us.
MEDINA: First of all, thank you because I feel like this is a much-needed conversation, and sometimes I feel like I live in this little bubble in Silicon Valley and people don't want to engage in a larger conversation. So thank you for doing this and doing this series of conversations. And the other thing is that this is not an easy lifestyle. It's not easy if you're a white guy and you went to MIT and were top of your class. It's not easy for anybody. It is easier in some ways, but it is not easy. And so if you can find people to support you, to help you along the way, it doesn't really matter what they look like, but having a sense of your cultural background and where you can go forward is what's important.
MARTIN: All right. Deldelp Medina of the Latino Startup Alliance, Jewell Sparks of BiTHouse, Brian Dixon of Kapor Capital, thank you all so much for joining us.
DIXON: Thank you.
SPARKS: Thank you.
MARTIN: And please tune in throughout March as we take a deeper look at the gender gap in the tech industry. We're talking to some of the women who are big players in tech. We'd like to get input from you if you are a leading lady in tech or an interested observer. Let us know what you're up to on Twitter. Use the hashtag, #NPRWIT. Transcript provided by NPR, Copyright NPR.