Diversity provides companies many benefits including greater innovation and profitability. Despite these advantages, diversity gaps persist in the tech startup ecosystem. These gaps manifest in different ways including venture capital funding, board composition and the implementation of diversity initiatives.
A 2019 Crunchbase survey found that 77% of tech founders in the U.S. are Caucasian or white. This figure is even higher in Europe at 84%. The same report revealed that male founders had the lion’s share of seed, venture and corporate investments. Women only accounted for 3% of the total venture funding in 2019.
When it comes to diversity initiatives, less than half of tech startups have company-wide diversity hiring and promotion goals and only around a quarter of them are actively trying to increase the diversity of their leadership teams. This naturally results in the lack of diversity in the C-suites and corporate boards. Data from Silicon Valley Bank showed that less than half of tech startups in the US, UK and Canada had at least one diverse member in their management teams.