In the wake of George Floyd’s killing, corporate America is trying to walk the talk when it comes to matters of racial justice and equality. This time it’s bigger than press releases or PR-driven diversity pledges. Early efforts have been led by African-American CEOs, entrepreneurs, and companies that serve a diverse customer base, but nearly all major brands have stepped up. Nike pledged $40 million over four years to support black communities. Comcast has committed $100 million over five years in grants to equal justice groups and support for small businesses owned by people of color. Wal-Mart has ponied up $100 million in community grants… and the list goes on.
Yet businesses continue to fall short when it comes to diversity, equity and inclusion (DEI) in the workplace. One glaring example is the technology sector. From startups to enterprise companies, tech just can’t seem to make measurable progress when it comes to greater black representation in senior management and on boards. Venture funding, too, goes mostly to youngish white men.
Make no mistake, just like other businesses, Big Tech has stepped up with financial pledges to antiracist causes and statements of commitment to racial justice. But six years after their first diversity reports, a string of technology players have seen only marginal increases in the number of black employees. Overall, nearly every company on the top-tier list has fallen short of their announced goals. Facebook went from having a three percent black workforce to 3.8 percent over a five-year period. Amazon’s numbers are better, but they include warehouse and delivery personnel who typically don’t enjoy the salaries and benefits of office employees.
Diversity experts say that part of the problem is these large tech companies just weren’t designed with diversity in mind, so efforts now amount to a “retrofit.” If that’s the case, one would think that the startup and venture worlds would offer greater potential for progress against DEI metrics. Yet, there, too, the news isn’t very encouraging. The progress reported is around women entrepreneurs — good to hear, but it’s not enough.
Clearly, for the tech world to become more diverse, there should be not just metrics, but consequences for falling short of DEI goals. As Bari Williams, former senior counsel at Facebook puts it, “These companies are data-driven, but if people are not hitting their diversity metrics, where’s the downside?” There seems to be none.
And in the startup world, there will never be equal investment in black-founded startups until and unless venture capital companies are more racially diverse. TechCrunch reports on a rush by VCs to support black founders and investors since the protests began. SoftBank, the world’s single largest tech investor, has announced a $100 million Opportunity Fund that will invest exclusively in black startup founders and other entrepreneurs of color. Andreessen Horowitz has followed with the unveiling of its Talent x Opportunity Fund established with donations from a16z partners for all-important seed capital to entrepreneurs with non-traditional backgrounds.
It’s a move in the right direction. In addition to diversity within VCs, formal and informal mentorships and accelerators for nonwhite founders would seem critical channels for building truly diverse organizations from the get-go. Starting with startups is a real key to building a more diverse technology sector and community.
The commitments amount to a big step forward, and the intentions are good. But reaching real DEI metrics in this sector, as in others, is a whole lot harder than it sounds. The protests will eventually fade, and the economy could slip into recession, or worse. But commitment to racial diversity and equality is now inextricably linked to business reputation. And now the world is watching.