Before it was a buzzword, DIVERSITY was a portfolio strategy
Diversity has always been the best investment portfolio strategy. It’s common knowledge that “diversifying your portfolio” is a smart financial play. But that’s not what is happening in today’s startup investment landscape.
“In the real world, money flows to the ideas that are the most convenient to find or the most familiar, not necessarily those that are the best.”
Instead of carefully balancing investment portfolios among founders of different genders, skin colors, geographies, and personal histories, the evidence shows that VC investors today invest 98 percent of their dollars in companies led by white men.
Annually, only 2 percent of VC funding goes to women and 1 percent goes to people of color. In the last decade, only .00006 percent of VC funding has gone to black women. To put a dollar figure on total funding for black women in the last ten years, of the $424.7 billion tech venture funding raised since 2009, only $289 million has gone to black women (an average of about 29 million annually). Clearly, this means we are missing out on big ideas and big profits.
“It was crazy to me that 90% of venture funding was going to white men, when that is not how innovation, intelligence, and drive is dispersed in the real world.”
Given the reality on the ground, and keeping in mind that diversity has always been the best investment strategy, it’s crystal clear that the startup investment ecosystem’s status quo is NOT a rational investment strategy. It’s not a strategy designed to elevate the best people and best ideas. It’s not a strategy at all!
At Lunar, we know that although talent is evenly distributed, opportunity is not. And that’s why Lunar exists — to provide opportunity and support to insanely talented startup founders who may not look like your typical white, male entrepreneur.
Lunar’s focus benefits everyone. The Center for Global Policy estimates that the United States is missing $300 billion from the national economy and nearly 9 million jobs by failing to invest in entrepreneurs of color. Additionally, the evidence shows that business teams with ethnic diversity perform 35 percent better than than the national average, and that gender-diverse teams perform 15 percent better than the national average.
We want more startups led by diverse teams to succeed, and it’s easier to start and scale a business when you have more money, more resources, and a pathway to connect to a network of talented people (social capital). So that’s what Lunar Startups does. We connect startups led by women and people of color to customers and capital. We accelerate their achievement of key business milestones, growth, and success.
Join us on Monday, September 30 to learn more about our program, to celebrate the graduation of our first Lunar cohort companies, and to hear how these amazing founders are growing and scaling their businesses.
Grab your free ticket to UnDemo Day at the Palace Theater on September 30 by clicking the button below!