I see this argument made a lot. But this argument has a huge hole in it - Chinese and Indians are also not "like them". And yet, Chinese/Indians are not underrepresented. If Hank William's theory were correct, they should be.
Any theory concerning the underrepresentation of blacks which does not distinguish between blacks and Indians is flawed.
I once heard an older, well-known investor and entrepreneur in the Boston area tell a room full of students that a startup he's most likely to invest in is one whose founding team includes an IIT graduate. Earlier this month, Foundry Group VC Seth Levine said he felt "surprised" being pitched by a group of guys in their late 40s and 50s (http://www.sethlevine.com/wp/2011/10/is-there-age-bias-in-vc...). Hank described the Sequoia VC saying that they're biased toward younger people.
These types of biases come from people who have established patterns of personality traits and other characteristics of what makes for a successful startup and who they like to deal with. I would further posit that they have established norms for dealing with such people (including building networks which support such connections) which makes it easier for both parties to move the relationship forward.
If, however, a startup founder doesn't fit the molds of age, ethnicity, education, background, or whatever, his or her chances of being taken seriously and/or accomplishing something together are much less.
People who play the slot machines or invest in the stock market are notoriously superstitious. I don't think VCs are much different.
I don't think VCs accurately keep track of which founders they reject and end up successful anyway, and adjust their metrics based on that data. I think they have hunches and some founders become successful and then they filter more aggressively on those character traits and confirmation bias takes care of the rest.
The bias could be that a person who is in their 40's and 50's could be considered "stale" in the same way that a house that sits on the market is if it hasn't sold.
There is a belief somehow that something just out there is potentially something to snap up. It's easier to believe that something great is possible with the 20 year old since they have no track record of not doing anything great yet. They feel they know the older person isn't a hot shot but they don't know for sure that the younger person isn't a hot shot. (Of course this doesn't apply to older entrepreneurs who have a success or even a (high profile) failure in their past.)
Yes, they often are. One of the biggest names in the VC world is Vinod Khosla. Kleiner Perkins has a whole team dedicated to China. Accel has multiple Chinese and Indians on their US team (and dedicated China and India teams).
Every major SV VC firm looks like this. White (US), White (European), White (Israeli), Indian, and Chinese.
The "them" isn't just Caucasians, but it includes Chinese and Indians.
Similarly, would an Indian founder be at a disadvantage applying to Fred Wilson? Somehow, I suspect any disadvantage would be minor, if it existed at all.
In any case, your theory of who "them" is now drawn quite broadly. It's not so much people looking for others "like them", it's more like looking for people from within an arbitrary subset that includes widely disparate and dissimilar groups (White and Asian Americans, Chinese, Indians, Israelis, Europeans).
[1] Ignore for the sake of argument that I'm the only non-Indian in my company.
This is not a very strong claim. It's been shown repeatedly with resumes and in loan applications that a black name/photo/applicant is less likely to move forward than a white photo/applicant with identical qualifications. It shouldn't be shocking that this exists in VC financing.
On the other hand, there isn't a "Black IIT" to bootstrap the tech reputation of blacks.
Most Black Americans also tend to have a higher quality primary education than the typical Indian student - their teachers tend to show up for work and their schools tend to have toilets with > 2 nines of uptime.
As for "very serious about trying to export their own tech workers", their efforts have made it considerably easier for Indian/Chinese workers to get an H1B. I guess you are right - Black Americans would probably have a hard time getting an H1B.
Most Americans, however, already have a conception of who Blacks and Hispanics "are" and it's not quite positive. They have a deficit initial position, where Indians and Chinese have a more-or-less neutral position. Moderately educated, well dressed Whites are generally neutral or positive. This may be in part due to the general American dislike of poor people -- immigrants who come to this country are usually educated and well off compared to the population of their country of origin, so the American over here only ever sees educated people from that place. However, that same American sees Black and Hispanic people all across the social spectrum, and can't help but have his opinion of that group lowered.
In my experience, the white guy who graduated from state college starts off -- in the mind of the person assessing him -- as well or better than the brown guy who went to a top tier school.
You're welcome to disagree, I'm sure you will object to some degree. This is only what I've observed.
I agree. In a sense it's like a negative brand association. I would add that we could also discuss the positive association of blacks with sports or entertainment vs. some other minorities or even whites.
But Jewish and sports? No.
Jewish and Medicine? Yes.
The terms "white" and "black" when applied to race are not objective measures of skin-pigmentation. They're proxies for other traits. They are used differently in different cultures. For instance "black" in the U.S. may not be "black" in Brazil.
For example a light-skinned European from Spain would be considered white in the U.S. A person with the same appearance, but from Mexico would be considered Hispanic.
In my part of Canada, we generally don't refer to people as Hispanic. They'd just be white or maybe brown. Unless maybe they're poor and don't speak English or French.
Chinese and Indians fall into "model minority" stereotypes, which have their own set of evils (you are X so you must be good at Y is it's own kind of dehumanization). So someone making a gut call might have underlying prejudices for Asians and against blacks.
In other words, when is the last time a white person has crossed the street to avoid a Chinese/Indian person walking towards them. Ask a black guy when the last time that happened.
I think there are also many cultural differences at play, as well as people's perceptions of those cultural differences.
Startups take their own kind of crazy, and it really helps to be surrounded by people that tell you its ok to be crazy or are at least as crazy as you. And if you are going to be around crazy people, you will probably want to know that they are the same kind of cazy :) Being from different cultures (or assuming you are) will make it harder to sense this.
Edit: I'll answer my own question, in 2008 alone African immigrants only accounted for 3% Asian immigrants (which includes India) accounted for 53%. I'm sure that's not a recent trend.
In a more general form, it would be nice to hsve some reference to the statistics on this since it's very interesting.
I focused on "like them" because that's a lower entropy theory than "fit a pattern" - it's a claim that VC's thought process is x -> cultural_distance(self, x).
"Fit a pattern" is basically just an assertion that VC's have a table of values in their mind, { "asian" : +1, "white" : 0, "black" : -1 } without explaining either where it came from or how we even know it exists. It's certainly very difficult to disprove, but only because it tells us very little.
Ask a black guy when the last time that happened.
Well, I'm a white guy, and the last time it happened to me was Tues. This happens to me fairly frequently when I'm in the US.
History: without it, life is confusing.
On the other hand, other non-European minorities were excluded from the US all together, leaving less time for stereotypes to calcify. The IT industry itself has a strong presence in India and China, so cross-pollination is logical. It has not had a similar expansion into Africa, or we might see similar growth of African entrepreneurs.
‡Maybe you mean black Africans, but blacks are not the only Africans -there are south Asians, whites, Chinese, Arab, etc.
This is not a subject where we have to rely on speculation or personal experience. We know widespread racial bias exists because of solid scientific evidence accumulated over years of study. An example and some history: http://www.sciencedaily.com/releases/2009/06/090617142120.ht... . There is no reason to assume VCs are immune.
> In that case, why do Indians/Chinese "fit a pattern that appeals to them" and Blacks do not?
Because the stereotype of "acting black" is so pervasive and negative.
The black hipster who knows Python and doesn't wear a dew-rag probably needn't worry. Essentially he may be black but he doesn't "act black".
Also, if he's one guy in the startup that's ok -- it fits the pattern. If the whole startup is black, maybe you wonder if they're ghetto. Doesn't fit the pattern because you haven't seen it before.
The bro who shows up with a noticeable accent and stereotypical behaviours is at a disadvantage.
Successful blacks become invisible because they don't "act black" because the old stereotype is that you can't be really black and successful (except in sports, or entertainment).
Someone once said to me: "So these guys were real niggers, you know, not like you -- I mean trash."
On the one hand, I was offended. On the other hand, I knew what he meant.
In actuality, a landmark Supreme Court case was of an Indian man who wanted to own US property but couldn't and his defense was that he was related to Aryans and therefore could be considered White.
Black isn't so much a color, it's both an individual and collective experience, and the experiences of Blacks in America in relations to Whites is what makes race-relations and social, political, economic progress unique to Blacks as opposed to other ethnic groups who have faced discrimination and even oppression but not to the degree of Blacks.
The closest comparison I would make to Blacks and Indians is of the higher Indian castes and the Dalits (Untouchables). So, yes, Black and Indians can be distinguished from one another and at the same time learn from one another.
> Black isn't so much a color, it's both an individual and collective experience,
> and the experiences of Blacks in America in relations to Whites is what makes
> race-relations and social, political, economic progress unique to Blacks as
> opposed to other ethnic groups who have faced discrimination and even
> oppression but not to the degree of Blacks.
[I know the original Indian referred too, I was disputing the "unique" part]
Like I said, I was rather unhappy with the "unique" comment. I would bet there are far fewer tribal members in Silicon Valley startups compared to other ethnic groups.
Then you shouldn't use the word "unique" in a context of "had it worse" then other groups.
"Dept. of Indian Affairs"
Are you out of Canada or at one of the states? The Federal level is called "Bureau of Indian Affairs".
If you apply for a computer security job, make sure to not list "Dept of Interior" in the context of tribes. They had some serious data loss issues (as in whole Dept of Interior (parent org of BIA) being taken off the internet. I still want to talk to the damn judge since he removed the tribal college access to the internet at the same time (including those schools not getting their internet from the BIA). The bricks just keep on being stacked.
Let me flesh it out for you. I said, "The European colonies in America joined the African slave trade because the supply of American Indian slaves was being exhausted, as a matter of fact." Which means I'm not only aware of the trans-Atlantic slave trade, but I even outlined the specific reason why slavery of American Indians wasn't sustainable and why the North American colonies had to engage in the trans-Atlantic slave trade to begin with. The fact is, west Africa had more slaves to sell.
Speaking of Brazil, if you start at the end of the second paragraph of Wikipedia's article about slavery in Brazil, it says the exact same thing happened in Brazil:
Starting around 1550, the Portuguese began to trade
enslaved Africans due to two main reasons:
* The unenculturated indigenous peoples deteriorated
rapidly, and became increasingly wary of the
Portuguese, thus, obtaining new indigenous slaves was
becoming harder and harder.
(Note: I am from New York, so I actually don't know the answer)