Hacking the Network Gap: Advancing Diversity Among Tech Funders and Founders
By John Rice, Founder & CEO of MLT and David Sze, Partner at Greylock
Modern technology is one of the greatest opportunities for wealth creation—with most of the financial returns accruing to the founders, early employees and investors in the breakout startups from each generation. However, Black, Latinx, and Native American people have been largely shut out of participating in tech startups and venture capital. Just 1.8 percent of all venture-backed founders are Latinx, and a mere 1% are Black. Last year alone, 10,000 deals raised $136 Billion. By comparison, there are only 343 Black founders who have ever received venture capital. And of all VC investing professionals, only 3% are Black and 5% are Latinx.
The barrier for wealth creation is not a lack of a college education, but a ‘network gap.’
That extreme underrepresentation is not a pipeline problem. More than 20% of science and engineering grads and 21% of Computer Science grads in 2013 in the US are African American, Latinx or Native American. The barrier for wealth creation is not a lack of a college education, but a “network gap.” We can address this by working together to help well-established members of the startup and venture capital communities widen their trusted relationship networks to include more people of color, while also connecting diverse talent to the most accelerating opportunities and preparing them to navigate the ecosystem successfully.
We (David and John) have known each other since college and, a few years ago, we started to talk about ways in which Greylock and Management Leadership of Tomorrow (MLT) could work together to increase diversity in Silicon Valley. As protests against systemic racism erupted across the country over the last several months, we accelerated the conversations into actionable ways Greylock could help support MLT’s goal of deepening impact in the epicenter of tech and venture capital, turbo charge MLT and its work, and to establish the frameworks for long-term success at scale.
Today, Greylock and MLT are announcing a strategic partnership in an effort to help accelerate change for POC in the venture and startup ecosystem. Greylock and MLT will collaborate on creating and launching open and scalable initiatives to advance diversity among technology funders and founders across the industry.
This partnership will take MLT’s comprehensive strategy for accelerating progress for individuals and institutions and specifically apply it to the tech startup and venture capital ecosystem.
This is MLT’s most substantive initiative directly focused on the venture capital and startup industry. MLT has already made a meaningful impact helping Black, Latinx, and Native American talent advance and excel in high-trajectory careers in the broader technology sector. More than 1,700 of MLT’s 8,000 alumni work in tech, nearly a hundred startups have been founded by MLT alumni, and two dozen have raised more than $500 Million in VC funding. There are 60 MLT alumni in venture capital, and five VC firms founded by MLT alumni have raised a combined $330 Million.
The partnership with Greylock will build on MLT’s proven core capabilities. Since 2002, MLT has provided Black, Latinx, and Native American talent with the coaching, playbook, and networks they need in order to excel in high-trajectory careers. MLT’s institutional engagements combine best-in-class recruitment, retention, and winning DEI strategies. This partnership will take MLT’s comprehensive strategy for accelerating progress for individuals and institutions and specifically apply it to the tech startup and venture capital ecosystem. We are excited about this long-term partnership, and are in the early stages of developing our strategic blueprint and target outcomes.
There are a number of ways that Greylock and MLT will begin to work together. Greylock and MLT will coordinate recruitment and retention for startup talent at all levels—from university graduates seeking core engineering and product roles, to executive leaders and board directors. Greylock will support MLT founders as they are navigating the VC and accelerator/incubator environments. In addition, Greylock will connect with and support MLT talent interested in pursuing a career in venture capital.
Additionally, MLT is raising an impact fund to establish a more robust foundation on which to continue building and scaling efforts to broaden access to wealth—creating opportunities in the tech and VC ecosystem. Greylock’s partners are also personally donating the first $5m to anchor MLT’s fund, and David Sze from Greylock is joining the MLT advisory board. Greylock also invited MLT to become a limited partner in the newest fund.
Every resource is needed to make progress against our shared history of systemic racism in the US. We are working together to widen the road of opportunity so no matter what your background, you have an opportunity to reach your full potential.
The robust partnership between MLT and Greylock is one of many necessary initiatives dedicated to improving access and outcomes for people of color in the technology startup and venture capital ecosystem. We are working on this by bringing our networks, resources and experiences to bear on the issue. Every resource is needed to make progress against our shared history of systemic racism in the US. We are working together to widen the road of opportunity so no matter what your background, you have an opportunity to reach your full potential.
John Rice is the Founder and CEO of Management Leadership for Tomorrow.
David Sze is general partner at Greylock Partners.