A note from our editor, Elizabeth MacBride:
A Particularly Gross Assumption
Earlier this month, the National Venture Capital Association and the University of North Carolina’s Kenan Institute of Private Enterprise released a report on job growth in U.S. venture-backed firms.
The headline: Employment at VC-backed firms grew faster than employment at non-VC-backed firms between 1990 and 2020. This is like saying the world’s hot-dog eating champion can eat more hot dogs than the average hot-dog eater. (I have problems with argument for venture capital as a broad-based economic development. More about this here).
One of the most terrible assumptions in public economic policy is contained in the report. I want to call it out, not to single out the researchers or the backers of the report in the venture industry. This assumption is widespread, but it needs to be corrected. That’s the idea that the reason that Main Street businesses don’t grow as large as VC-backed firms is because their founders have less or different ambitions.
The controlling fact here is the U.S.’s patriarchal finance system.
Venture capital is the profit-making tip of the capitalistic enterprise. Most venture capitalists are white men, and the people they fund remain predominantly male and white (probably more than 80%). Meanwhile, the broader landscape of business today – the 99% of startups that don’t get venture finance — is dominated by women and people of color.
The reasons some people emerge as “winners” at the heads of big businesses and others don’t are obviously complicated – lack of capital, networks and culture all play a role.
But here’s what the report said, in a throwaway line:
“Our results also reinforce the findings of prior research that young, knowledge-intensive companies increase their labor force more rapidly than other young, so-called “Main Street” businesses which often lack similar ambitions to evolve into large companies.”
The underlying assumption is that women and people of color chose to exclude themselves from the world of fast-growth startups, from big success, and king-sized seats at the table. For that statement to be true, ambition would have to be distributed on a downward scale, with white men at the top.
That’s just gross.
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To list an opportunity in our newsletter, check out our rates here. We cover the emerging economy of diverse founders:
1. A Course To Reach the Next Generation of Entrepreneurs
In this free course developed by entrepreneurship professor John Lynn, professors and other entrepreneurship educators get a curriculum and supporting materials based on the influential book, The New Builders.
1. Bursary Benefits Available for AI Week 2022
Amii has announced plans to award $100,000 in talent bursaries to empower AI technical professionals to attend AI Week 2022. Apply now to have your travel expenses covered – awards are allocated on a first-come-first-served basis.
Date: May 24-27, 2022
Location: Edmonton, AB
3. Join 4thly for a Special Panel on Access to Capital for Underrepresented Founders
As 4thly writes, “This livestream is designed for entrepreneurs who are concerned that their identity will be a headwind in raising capital.” Join 4thly Founder and CEO, Bret Waters, and an expert panel of diverse entrepreneurs and investors to learn more about the new wave of venture capital.
Date: Feb. 28, 2022
4. NBA All-Star to Provide Funding and Resources to Underserved Communities
NBA All-Star and 2021 NBA Champion, Jrue Holiday, and two-time Olympic gold medalist, Lauren Holiday, through their JLH Social Impact Fund, will provide up to $1M in grants to organizations and small businesses in the Greater Milwaukee, New Orleans, Indianapolis, and Los Angeles areas. Priority will be given to businesses and organizations focused on social impact and creating a more equitable future for underserved communities.
Application Deadline: Feb. 25, 2022
Location: Greater Milwaukee, New Orleans, Indianapolis, and Los Angeles areas
5. Render Launches Second Iteration of Reconstruct Challenge worth $750,000
Render has announced a new partnership with Access Ventures to award a second national prize focusing on addressing barriers to employment in the United States. Five winning innovations will receive $100,000 each, with one innovation receiving an additional $250,000 to scale further. The challenge is open to anyone in the United States as long as the beta test of the innovation takes place in Jefferson County, KY, or Floyd and Clark County, IN.
Registration Deadline: April 29, 2022
Application Deadline: May 27, 2022
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