It’s hard to argue with the fact that intellect, creativity, and resourcefulness are evenly distributed by zip code. Unfortunately, access and opportunity are not.
This is embarrassingly apparent in the high-stakes world of tech entrepreneurship. If you line up founders of the top 25 tech “unicorns” — startups now worth more than $1 billion — you won’t see any African American or Latino/a faces, and you will see hardly any women.
That glaring gap was the reason behind today’s first-ever White House Demo Day, an inspiring showcase of successful entrepreneurs whose race, gender or family background makes them stand out from the traditional crop of visionaries. Leaders from Intel, Pinterest, Twilio and many other companies were in attendance, a sign that the tech industry is (finally) getting serious about diversity and inclusion.
At this promising moment, I am proud to announce that the Kapor family of organizations is making a $40 million investment over the next three years to accelerate our work to make tech entrepreneurship more inclusive. We’re doubling down on diversity because it’s good for individuals, communities and the economy as a whole.
My wife Freada and I have made it our life’s work to close the opportunity gap in tech. Through our organizations — Kapor Capital, the Kapor Center for Social Impact and the Level Playing Field Institute — we have been at the leading edge of efforts to break down barriers to success in Silicon Valley and the broader tech community.
As we’ve often said, there is both a pipeline problem and a leaky pipeline problem for African Americans, Latina/os and all women in tech. We will take a comprehensive approach, supporting three interrelated pillars:
1) Access to tech education,
2) Access to capital and
3) Strong community institutions.
The first pillar of our investment will focus on high school students. Too many American public schools — more than 85% by one count — fall short in their computer science and engineering offerings. Our schools are failing millions of students who develop an early passion for science or coding, and they are too often failing to stoke that passion in the first place.
For the past 14 years the Level Playing Field Institute has sought to close this gap by operating rigorous STEM-focused college prep programs for low-income students of color. This year, we will invest $6 million to scale and expand the SMASH (Summer Math and Science Honors) Academy, a rigorous five-week summer STEM program that matches underrepresented students with the academic and technical training, resources, role models, and connections they need to pursue their dreams. Ultimately, we want to ensure that every student has a chance to make an impact in the 21st Century economy.
The second pillar of our investment will address the gap in access to funding. Blacks and Latinos make up less than 1% of startup founders who secure venture capital funding.
Over the next three years Kapor Capital will make over $25 million in direct investments in technology startups working to narrow the achievement gaps. At least half of the companies we invest in will have founders from historically underrepresented communities.
Our team at Kapor Capital is itself majority people of color, so our investment decisions and deal flow reflect the unique lived experiences of our team. We will continue to seek out founders with big ideas that have the potential to generate both economic returns and a positive social impact. A few illustrative examples from our portfolio include:
Lendstreet — a lending platform helping borrowers refinance old debt and rebuild their financial lives.
Honor — an online platform providing high-quality home care for those who need it while providing fair wages and respectful treatment for home health care providers, and coordinated treatment communications for family members and health care providers.
Piazza — an online study group allowing students to ask each other and their professors questions, anonymously if they choose. Now serving more than a million students, Piazza is also a recruiting platform for tech companies.
Proven — Proven is a mobile app for finding employment in the restaurant and hospitality industries, allowing job seekers to apply for jobs using their browser or smartphone.
Three of these four companies were founded by an entrepreneur from an underrepresented background; all are committed to closing gaps in access and opportunity. We will continue to seek out founders with big ideas that have the potential to generate both economic returns and a positive social impact.
Finally, we believe that the effort to make entrepreneurship more inclusive will ultimately need to be a local phenomenon. As the third pillar of our investment, The Kapor Center for Social Impact will commit $3 million a year to promoting a more diverse tech ecosystem where our team lives and works, the Bay Area. Our new building, opening this winter in Oakland’s Uptown district, will be a hub for building the startup ecosystem of gap-closing companies, mentoring and networking for underrepresented entrepreneurs, community education, student hackathons, and convenings that leverage the under tapped genius in our backyard.
We hope and believe that our $40 million commitment will encourage others in the tech industry to match and multiply our investments. We have always been early investors, assuming risk at the seed stage in order to prove concept viability to later-term investors. This has been true whether the investments are for profit or non-profit endeavors. In this way our investments have a huge multiplier effect, and we expect that that will be the case with this pledge. Just a few years ago we were virtually alone in this endeavor.
Now, as major tech companies have started to release diversity data, revealing a deep disconnect between their employees and their customers, we are excited to work collaboratively to magnify the effect of our work. For example, we asked Google for Entrepreneurs and Village Capital to co-sponsor a first-of-its-kind pitch competition for startups that leverage technology to make all aspects of employment — from hiring practices to compensation to promotion criteria to complaint tools — less biased. We hope to launch a whole new tech investment sector, often with underrepresented founders, whose products will change the practices of all kinds of companies .
At the end of the day, making tech more inclusive is about more than just accessing untapped talent; it is about rethinking the kind of products that America makes. As we can tap into a wider range of lived experiences, we will see more startups that narrow gaps in our society like Lendstreet, Honor, Piazza, or Proven, and fewer that only serve to widen those gaps.
Imagine how different the tech world would look today if industry leaders had committed to diversity and inclusion a decade ago. Now imagine what it could look like in 10 years if we choose to double down on diversity now.
That is a vision worth investing in, and we invite others to join us.