When 500 Startups was founded 10 years ago, being inclusive was core to our firm’s mission. We invested in founders from all over the world and our team members came from diverse backgrounds that did not fit the typical profile of a Silicon Valley venture capitalist.
Still, the conversations around systemic racism this past year reminded us that we needed to redouble our efforts. More specifically, we made a commitment to track and measure our progress as it relates to diversity and inclusion–internally and within our portfolio.
To better understand our diversity performance and signal our advocacy for D&I practices, we engaged Diversity VC, a non-profit organization that works in conjunction with Diversio and OneTech to assess hiring and training practices, as well as sourcing and diligence of investments, and benchmark fund managers against peers in venture capital. They reviewed our progress to date and completed an assessment of our policies and practices, so that we can establish a baseline to measure against going forward and identify opportunities for improvement.
We are pleased to share that we received a certification from Diversity VC, and have begun implementing their recommendations.
This will be an ongoing process that requires active monitoring, and we plan to conduct internal surveys annually to assess progress. Because of the global reach of our organization and portfolio, we are also working with Diversio to design processes and metrics that are region-specific.
“There’s a very clear demand from the public on corporate action when it comes to this [diversity and inclusion.] A lot of investors felt it was their duty to be part of this conversation, and do what they are able to do to move it forward,” says Anna Klimbovskaia, co-founder and COO of Diversio.
500 is also actively seeking to increase the diversity of our co-investment networks and foster the ecosystem, by sharing and creating opportunities for diverse founders through our 2021 Unity and Inclusion Summit which takes place on April 7th and 8th.
After reporting our first set of portfolio statistics last year, here’s another snapshot as of December 31, 2020:
- 4.6%¹ of companies in our portfolio have at least one founder who identifies as African, African-American, or Black (compared to 1%² across the larger venture industry)
- 10.8%¹ of our startups have a Latinx founder (compared to 1.8%² for the venture industry)
- 24.9%¹ of our portfolio has at least one woman founder (compared to 13%² for the venture industry)
We will continue to share our progress, as we recognize that our efforts at diversity and inclusion will be an ongoing journey.
References:
1- This data is based on internal analysis of portfolio company data aggregated across all investment funds within the 500 Startups group (“PortCos”). The data is based on (i) a voluntary survey of PortCo founders/management teams which received responses from 72.5% of the founders polled and (ii) independent research conducted on the public records relating to PortCo founders/management teams by representatives of 500 Startups. The founder responses and the research data have not been verified and the accuracy or completeness thereof is not guaranteed. This data is as of December 31, 2020 and is provided for educational or informational purposes only, does not constitute any solicitation or marketing content, and should not be relied upon by any person (i) in making a decision whether to invest in, or engage in business with, 500 Startups and (ii) as legal, tax or investment advice. Further details on methodology and assumptions can be obtained from the 500 Startups Data Team.
2- Industry wide percentages as reported in [https://www.forbes.com/sites/committeeof200/2020/09/22/diversity-as-uperpower-the-well-known-data-against-homogeneous-teams-in-venture-capital/#2e0c2cba2019] OR [https://about.crunchbase.com/female-founder-report-2020/]. Note that such datasets may be as of a different date than the data presented for 500 Startups. Such external data has not been verified.
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