Understanding Diversity, Equity and Inclusion (DEI) in the Startup World

McKinsey revealed a study not long ago demonstrating that “companies in the top-quartile for ethnic/cultural diversity on executive teams were 33% more likely to have industry-leading profitability.”

That’s not surprising, and it’s a trend that is clearly reflected in the experiences of DEI specialist and startup investor Aubrey Blanche, currently the senior director of equitable design at Culture Amp, with whom Storm Ventures has been in close contact this year.

Aubrey’s own company MathPath (she considers herself a math nerd and an empath!) helps companies with equitable design, implementing their own DEI systems and cultural transformation strategies. She is also part of Operator Collective, a VC firm whose limited partners (LPs) are 40% people of color.

That conversation inspired me to explore new ways of building fairness and equity in the startup, tech, and financial sectors. As Aubrey explains, equity is a constant process; diversity is the outcome. Today we’ll look more deeply into the field of DEI.

So, how does equity work in a startup? Let’s run through our main talking points and the conclusions we reached.

Your CEO Can’t Be Your Chief Diversity Officer

DEI work and equitable design are very difficult to argue against. Still, organizations rarely elevate them to the top of the priority pyramid.

Your CEO can’t be your chief diversity officer or your director of equity and inclusion. Aspirationally, the CEO may have some compelling ideas, but logistically, this approach just won’t work. The word diversity itself can get in the way of progress. It’s really broad and non-specific, and therefore it’s hard to put into action.

When people say diversity, they usually mean gender equity. The research contained in Atlassian’s 2018 report The State of Diversity showed that people associate the word diversity with two groups: white women and Black Americans.

Both deserve to have artificial barriers to progress removed. But they’re not the only groups that are marginalized. The word diversity often gives organizations credit for doing Black equity work, when in reality, they’re not. They’re running gender equity initiatives that primarily benefit straight, White, cisgender, non-disabled women.

In other words, the term causes us to miss other groups, like those with disabilities, and the question of how organizations are creating inroads for that community to get into tech.

By failing to specify gender equity, disability, and access — or Black or Asian equity — it’s easy for organizations to stake misguided claims of diversity. “We’re not complete carbon copies of each other; therefore, we’re diverse,” they say. But this is a strawman argument.

During a recent conversation with an HR leader, I was reminded about the value of equity in creating stronger outcomes for a startup. That includes M&As. After all, DEI is a cultural value that larger companies appreciate; it’s a group of employees they appreciate, and they don’t necessarily want to acquire a startup that doesn’t share those values.

Equity Brings Larger Talent Pools

Startups want to have the best chance of hiring the best possible people for their mission. If you create an environment where only a small number of people feel comfortable, you’re automatically restricting the talent pool you can hire from.

In startup land, you’re dealing with people with a very different set of motivations than those who work for larger companies. You simply cannot attract the best talent if you don’t build an inclusive culture welcoming to all.

A rambunctious atmosphere, for example, won’t be enjoyable for everyone. When employee morale is affected by a major community trauma event, then it becomes clear that you need a culture where people can talk about those experiences and bring them into the workplace. Otherwise, some individuals just won’t thrive.

Don’t Draw From the Same Problem-Solving Toolbox

An imbalanced team is weaker at problem identification. They tend to neglect problems when they arise, and they are more susceptible to groupthink. Their solutions lack strong development. For example, if a group was all taught by the same professors at Stanford, they will draw from the same informational and problem-solving toolbox.

DEI is a way of working. Yes, you have to create space for difficult conversations when they come up. But inclusion can be very simple. It’s about taking care that all your employees are invited to meetings; they are listened to intently, taken seriously, and don’t have to suffer constant interruptions.

Inclusion isn’t free; it takes time and effort. However, it doesn’t have to take the form of big-ticket, big-budget HR events. It can be established in the smaller details of how you conduct your business throughout the day.

Start Your Culture Early

Education comes first. You can build a strong foundation by checking out what’s trending in the New York Times Best Seller list this month. Start learning about race and racism, the deepest layer of all the exclusion problems. If you learn about that, you will gain skills that help you begin to address other systems of oppression like homophobia and transphobia.

The next step is to return to social media and audit who you’re following. Biased algorithms won’t help you expand your network beyond faces similar to your own or similar to the cultural majority. You have to do it yourself.

Start diversifying your network today. As the old Chinese proverb goes, the best time to plant a tree was 20 years ago; the second-best time is now. Find a way to connect with the communities that you seek equity for. Identify a meetup like Black & Brown Founders or a speaker series for a minority entrepreneurial group.

It’s easy to burn yourself out, but you can get started with a few messages a week to people who are underrepresented in your field. Just some positive words of encouragement can mean a lot to people. Furthermore, these diverse networks you’re building are the key to hiring more diversely.

Funder-founder matching tools are a helpful way of making yourself more available. I hear from many founders who genuinely want to hire more diverse executives and board members, but they simply lack the network. That’s where making a personal effort in your DEI work truly pays off.

Ryan Floyd is a founding Managing Director of Storm Ventures, where he invests in and works with early-stage enterprise SaaS startups. This article is based on a conversation with Aubrey Blanche, Senior Director of Equitable Design, Product and People at Culture Amp, and founder and CEO of The MathPath.

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