So, to put simply, VCs are only interested in those who already are full of multi-generational advantages and privileges built off the poor.
No wonder startups are bascially for white guys only.
No wonder startups are bascially for white guys only.
You are more likely to succeed in your business if you have the experience of building scalable systems, like at google, and if you have a similar friend group to recruit talent from, which is extremely hard at an early startup unless you already know the kinds of people you disproportionately meet at top universities and tech companies, and if you have family/friends that can help you out while you're struggling at the beginning of the startup, etc.
You are less likely to succeed if you have the financial encumberances that are common outside of the upper middle class, or if you have an unstable family structure that leans weight on you, if you don't have a safety net to lean on to get you through rough periods without personal income, and if you don't have the kind of network that a top school, top company, or connected family brings.
I came from a working class background, taught myself how to build products, made my own connections and raised some money for a startup and had to leave and return the money because there was a nonzero chance I'd have to adopt my nephew to keep him from the foster system, and couldn't possibly do that with the hours and volatility of that game. It is perfectly logical to avoid startups that have those kinds of additional risks when the game is already risky.
We absolutely should try to assuage those biases to improve economic mobility, but the answer isn't just to yell at VCs for trying to make money.
My opinion is their money is tainted from the get-go. It amounts to theft from the very people whom made the things.
You make some valid points, but I really dislike the above comment. When used it seems like a convenient way to diffuse responsibility, often to selfish ends.
There's lots of examples where this type of single-minded attitude isn't acceptable.
- A civil engineer cannot just have making money be the sole pursuit when designing or building a bridge
- A doctor cannot just have making money be the only goal when treating a patient
- A government worker cannot be only concerned on how to maximize their individual gains when awarding contracts
- A financial adviser is expected to act in their client's best interest, rather than their own
We're used to expecting certain levels of ethical behavior from some professions acting within a larger societal framework. I don't know why investing is so often left off the hook in this regard. Maybe it's naive, but I think we'd be better of if people told themselves it WAS their responsibility when making these decisions.
We should be voting for policies that strengthen the nation as a whole. A VC giving up a few % point in return in exchange for betting on poorer people is not going to change anything, other than that VC losing investors. We want to fix families? Well let's guarantee parents have time home with their children, let's guarantee they have sick leave and parental leave and vacation leave to spend with their families. Let's provide more transit and infrastructure and education to communities that need it.
It will require a transfer of wealth.
I would hope, for instance, that Boeing software engineers wouldn't take the stance that their job is to code to requirements and the safety engineers job to make sure the requirements are safe. I would hope everyone has the onus to look at the greater landscape for the impacts of their decisions rather than using a myopic view to skirt responsibility because it's convenient or easy.
Socioeconomic mobility is really much easier to pull on with policy and the education system.
Some people do work on trying to democratize entrepreneurship though, like YC with startup school, or Stripe with Atlas.
They do it by spreading information and reducing barriers, not by giving money to higher risk people though, since that's easier to align with their place in the system.
And it is mostly misguided. The barrier to entry and availability of information is what have already changed. It is everything else that hasn't. Or it has, but in the wrong way. By charging a premium for housing, education and contacts instead of taking it out of the equation. Some day all this friction is going to have consequences.
It's similarly strange to me when I hear people like Jim Cramer advocate investing in tobacco companies even if you find their business practices abhorrent because the point of the investment 'game' is to maximize profit. In his case, his solution was to take those profits and donate to a cancer charity. It just seems like a strange set of psychological hoops to jump through to avoid cognitive dissonance. It comes across that excelling at the 'game' is ultimately what's valued more than the ethics of the business decision. Again, maybe naive or poorly placed, but it seems the most moral choice is to make sure all the decisions align with your values, not creating strange workarounds so you can have your cake and eat it too.