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Designing Pathways To Entrepreneurship For Underrepresented Groups

Keith Ippel is the founder & Co-CEO of Spring, a leading early-stage impact investing ecosystem that’s raised $47M+ in early-stage capital.

For centuries, wealth has largely remained within the same families and communities. Historically, this has meant that only a limited few have had access to wealth creation and funding. But now we find ourselves in an exhilarating shift, where the stewards of wealth are starting to democratize access and where people are creating their own wealth movements.

There’s still a long way to go. As someone who leads a venture capital enterprise that prioritizes diversity and human health, I believe that if we really want to change the face of who benefits from the business and entrepreneurial ecosystem, then we need to change how we’re providing capital.

Venture Capital's Diversity Problem

This is what we’re dealing with. Only 2.1% of venture capital in the U.S. went to women founders in 2022, and in Europe, it was just 0.9%. These are disappointing figures, and they are bound to get much (much) smaller when you look at Black, Indigenous or disabled founders. In fact, Black founders only received 0.48% of all venture capital funding in 2023.

The numbers speak for themselves, but I worry that we’re all a little jaded when we look at just the data. Sure, we know it’s a problem. But how do we solve it? How do we use our investment dollars to help make an impact?

To me, investing is all about finding opportunities that are not just aligned to our return targets but also to our purpose. I call this ROI Squared: Return on Investment x Return on Impact. We make life decisions all the time based on our values and purpose, so why not inject that same framework into our investing? We don’t need to exist in a disconnect where we make financial decisions from 9–5 and purpose-driven decisions from 5–9 (philanthropy). We can bring it all together 24-7, 365 days a year.

Imagine what could happen if we partnered with and invested in underrepresented founders really making a difference? These types of leaders could help create further pathways for underrepresented leaders in the startup ecosystem.

I look to examples across industries like Bobbie Racette, a Cree-Metis CEO and founder of Virtual Gurus, who is on a mission to create employment opportunities for underrepresented individuals. Then, there is Lise Birikundavyi, founder of BKR Capital, a VC fund investing in Black-led businesses. Julie Angus is CEO of Open Ocean Robotics, a company developing zero-emission ocean-monitoring technologies.

These are the faces of innovation. The types of people we should be investing in to encourage more diversity of thought in the entrepreneurial space. The more we can create space for these voices to come into the room, the more we create opportunities for investing.

How Investors Can Drive Diversity In Entrepreneurship

As investors, I believe we get to reshape what the transfer of wealth looks like. We have a responsibility to open those pathways and ensure that as many different people as possible are accessing the funds they need to bring their ideas to life. Only then will we have true diversity in the entrepreneurial ecosystem.

So, how do we make that happen?

For those who want to get involved in early-stage investing, here are my recommendations.

Empower yourself through education. Plug into organizations that offer training and resources for early-stage investors. As an added layer, I recommend seeking out organizations that are moving the dial on democratizing access to funding. These could include organizations like GenderSmart and The Making of Black Angels.

Craft your investment thesis. As an investor, it’s important to have a "why." What are your drivers behind investing? This could include wanting to be part of a specific movement (e.g., supporting Black or disabled entrepreneurs, or mitigating the impact of climate change) or wanting to give back to your industry or community. Once you’ve narrowed in on your why, you can write up an investment thesis. (You can find templates for this online.)

Explore where you want to invest. With your investment thesis in hand, you can begin looking for investment opportunities that align with that thesis. This is when you’ll need to do more digging. Connect with accelerators, angel groups and VC funds that actively invest in underrepresented founders. Some examples that come to mind include The ACA, NACO in Canada and the various investing collectives that exist.

Creating this understanding and clarity as part of your investment process should help you go about it in an intentional way. As I said before, there’s huge potential for early-stage investors to create new pathways for underrepresented entrepreneurs; it’s just a case of making more intentional choices with how we distribute our wealth.


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