Minority businesses could boost the economy by as much as $300 billion, according to the Center for Global Policy Solutions. Yet many of these are sole proprietorships and are often working with limited resources that hamper their ability to expand and create more jobs and revenue.
In the last year, design firm GraphicSprings’ analysis of 5,000 funding announcements and exit reports found that only 4% of female-owned businesses and 13% of minority-owned businesses received venture capital funding. Part of the reason is that less than 3% of VC funds have black and Latinx investment partners, according to Pitchbook. Another reason is that VCs keep going back to the well of alumni from Stanford, Harvard, and the University of California, Berkeley, despite continued empirical evidence that diversity boosts innovation and female leadership increases pay parity, employee satisfaction, and ultimately the bottom line.
“It highlights some of the disconnect around pattern matching and the way that Silicon Valley has historically identified and selected the top talent that they want to invest in,” says Nicola Corzine, “All the way through to the access to education or the lack thereof, strength of mentors, strength of coaching.”
Corzine is the executive director of the Nasdaq Entrepreneurial Center in San Francisco. Throughout her career–she’s been a deal manager and partner with Band of Angels, Silicon Valley’s oldest seed funding group–Corzine has evaluated over 7,800 deals and steered $30 million in seed financing to 95 startups. Since 2015, she’s steered the nonprofit center’s efforts to serve more than 7,500 entrepreneurs. Among their ranks are 49% women and 61% minority entrepreneurs.
Yet Corzine admits that she was once guilty of this bias, too.
When vetting founder pitches, Corzine confesses, “I tended to expect that certain answers [from female founders] were just naturally not going to be as strong as their male counterparts.” All that changed, she says, with a study that came out not that long ago, “which is a little embarrassing,” Corzine says frankly.
Her first thought, on reading that both male and female investors had a different set of questions depending on who was pitching, was that there was no way she would ever do that. But then she had a few conversations with teams that she’d backed, and female entrepreneurs who were a part of those teams. While they never came out and said she hadn’t done it, Corzine says it was clear from conversations that it was a lost opportunity. “My role should have been to provide greater education and greater support,” she recalls, “and potentially lost shareholder value.” What’s more disappointing, says Corzine, “is that really talented and strong entrepreneurs had walked away feeling less than.”
To change this, Corzine says she did a lot of thinking about accountability. “Interestingly enough, one can have an amazing accountability coach,” she says, “somebody that emphatically peels back the layers and says, ‘You know, you’re supposed to be working with these types of individuals, and yet I hear you talk about these others.'”
That’s really different than a lot of the other types of coaching or mentors for professional development leadership skills. “All of those are wonderful,” says Corzine. “Find someone that you can partner up with that will hold you accountable to [seek diversity]. It has to be a top priority. If not, it’ll just get lost in the shuffle of the craziness that is life, and that’s just not an excuse anymore.”
Mentoring and training is a large part of what the center does to draw in more underrepresented minority entrepreneurs, too. “Typically, that kind of support isn’t available [for founders outside] the top 1%,” she says. “If we want to change the paradigm, you have to start moving access to coaching and access to quality professional development earlier.”
The second is that the mentors at the Nasdaq Entrepreneurial Center are carefully vetted and available to support the entrepreneurs from both an expertise standpoint and as dedicated leadership coaches.
And, Corzine underscores, “We went above and beyond to pull in top talent, teachers, mentors, and investors who are also women and minorities.” If the Center has a gap within its own talent base around a certain subject matter, Corzine says they’ll hunt the for the top 20 or 30 people in that area by asking their networks directly for nominations.
“So it really becomes more of a support system,” Corzine explains, “to ensure that they are getting the best quality in a wide variety of topics rather than just one person, one approach.” The breadth of talent, she says, helps particularly in the first six weeks as they are learning to hone their vision and pitches. “They’re able to argue so much better for themselves for all the right reasons,” Corzine maintains, “rather than feeling the only advice that they can pull down is just from the one person that they happen to have in their speed dial.”
Another interesting dynamic that’s brought the center to such numbers of underrepresented entrepreneurs is a focus on an individual rather than their business. “They didn’t feel that they had to be of a certain inflexion point or scale before being able to come in and get the help that they needed,” explains Corzine, without having to pay a dime.
“But if you’re accepted into our program, you’re always expected to support and nominate five other founders,” Corzine notes. “Those numbers have continued to amplify and in fact, grow [our efforts] further.”
That growth mind-set is what Corzine suggests any entrepreneur can benefit from. In fact, she says, if there was one word entrepreneurs would do well to permanently eliminate from their vocabulary, it would be “limited.” “So many entrepreneurs fall back on this construct,” she explains. But whether it’s investors, customers, or a potential team, says Corzine, “Everyone wants to be drawn to someone who doesn’t see their limitations, but rather sees the ultimate potential.”