The flip side of "We invest in people! We believe in the founders!" Is "We don't invest in other people. We don't believe in the founders."

Something else VCs won't tell you (until you get them drunk and monologuing) Is they fear the "racist next round."

Let me explain...
If a Black woman pitched Uber as a startup back in the day, (or Tesla, or We Work), a VC might have been willing to cut the tiny $1.57M Uber seed round check. They might have been able to see her

🤔 But... they'd know that a C round around $272MM is coming. D at $1.35B.
G at $7.33B. Etc. And after all that, the company might still need more.

That first seed round VC might say to themselves, "I'm not racist! I don't have a racist bone in my body! I believe in her! But those late round racists will never give her that C round. So I can't invest!"
This fear of the "racist next round" stops you from even being able to raise that puny little $1.57MM seed round.

But go head and "Lean In" or whatever. Lemme know when you find those bootstraps.

Or, pitch VCs that aren't racist funders, and hold those that are accountable.
If I were a 1st time fund raising Black woman, my short list would include:

@ArlanWasHere at @Backstage_Cap
@jewelmelanie at @collab_capital
@lo_toney at @PlexoCapital
@bryce at @indievc

I haven't seen them do a lot of hashtagging, but I have seen them "Wire and Hire." 👍🏿
More VC bias that should make folks think twice, but doesn't for some reason:

If you are a California state employee there's a 25% chance that you are Black or Latinx. California state employees pay into a pension plan called CalPERs. Up to 15% of your paycheck for ~20 years.
CalPERS is the largest pension fund in the nation. It takes all those member contributions and invests them in a number of different asset classes, including Venture Capital. CalPERS is one of the largest investors in VC funds.

VC funds hand out that money to entrepreneurs.
The VC firms give that money to pretty much everyone but Black and Latinx folk.

So a Latina teacher can work in SFUSD her whole career, giving up 15% of each paycheck to a pension fund, that will invest her cash in some tech bro, but not her Berkeley CS valedictorian daughter.
If CalPERS said,

"We only invest in VC funds that make at least X% of investments to underestimated founders."

For a reasonably high value of X, That would probably do more to increase diversity in venture capital than every other inclusion effort that has been tried to date.
And to my VC friends, don't @ me about Prop 209. Do better.
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