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  • Kevin Withane

Forget love, where is the change? | Diversity X




With Valentine’s just gone, February can feel like a month full of love. At this time of year we, as business leaders and analysts, do a lot of reflection on the previous year. As an advocate for underestimated founders, I spend my reflection time on diving into the data to understand how fundraising opportunities are changing for people like me and the outstanding community of founders that I’m working with.


Before sharing about my journey into the research, let me first explain what I mean by the term “underestimated founders”. Most often, this group of founders are referred to as underrepresented. That is, female founders, people of colour founders, LGBTQ+ founders, etc. I choose not to refer to them as underrepresented because they are well represented in terms of numbers. Rather, they are underrepresented in the equitable allocation of venture capital, particularly at pre-seed and seed stage. They are underestimated on the basis of their characteristics of gender, race, sexual orientation. But let’s see what the research shows.


The most difficult thing about this research is seeing reality in black and white, and also seeing how often that reality gets missed or glided over. Because the reality is, founders continue to be underestimated by VCs on the basis of their race, colour, gender, sexual orientation, or other protected characteristics. The headlines shout that there is more money for all, yet there is no significant acceleration in funds being awarded to underestimated founders, despite the rich rewards that await those who invest and those that are leading those companies.


Just by looking at one sector, in one geographical area, can give you an idea of what underestimated founders are facing. In Atomico’s The State of European Tech reports over the past five years, statements like ‘Europe urgently needs to fix its diversity & inclusion problem’, and ‘There is no material improvement in the share of capital invested…going to diverse founding teams’ are seen but the lack of improvements continue. Stagnation means that there has either been unremarkable change (1% growth in the share of capital raised by mixed gender founding teams between 2017 and 2021) or serious reductions (50% reduction in the share of capital raised by female founding teams between 2020 and 2021).




There are of course hopeful expectations that investment in DE&I talent will ‘level-up’, yet the diversity in these statistics are limited on both sides of the playing field, and of the pond. Less than a third of angel investors are female, and only 7% were minorities in 2017 in the US, whilst only 12% of decision-makers in VC firms are women (Capital Access for Underrepresented Founders Report, April 2021). This report also made it clear that despite the fact that when diverse teams raise more than all white teams, the artificial barriers still remain between investors and businesses, where founders were 21% more likely to be funded by an investor of the same ethnicity than of a different ethnicity, reinforcing ‘pattern matching’.



I can tout numbers all I like, but that’s not what I’m here to do. I’m here to do what I can for underestimated founders because the love is not being shared, and that needs to change. Gamechangers who may not have, in general, the same access or network, as their white male peers, are not being given the chance to succeed, but also equally important, to solve the real world problems their startups are trying to address.


As I hope you can tell, I am truly just done with seeing the industrial gaslighting each year in multiple reports. Reports like the ones above that show how the VC industry, and those it supports with capital, are the same year on year. They acknowledge the lack of diversity and inclusion, stating there has been some small progress, and essentially make those underestimated founders feel they should be grateful, when in fact there has been no meaningful change. It is like after Obama had become his terms as Presidency, people saying, “why are you still going on about people of colour not being represented”. When we start talking 10s of percentage point changes in a single year, then we can start talking about meaningful change.


Venture capital, and other fundraising sources, are supporting the space that is building our future world. The generations of founders that are, and will continue coming through need to have the opportunity to build a new society, but they need to have their image represented now – not just when the next generation gets there.


The work I’m doing with Diversity X is to build on this idea, and to build a better, more inclusive world for my children, where they do not need to work harder on the basis of their gender or colour, just to get a seat in the room. They should not have to face the same struggles I did to get where I am, and neither should you. I believe that by supporting underestimated founders with an active and inclusive community, and ecosystem, and access to capital, we can build a world where my children, and yours, will thrive.


If any of the ideas raised in this article interest you, if you yourself are an underestimated founder, or if you’d like to find more ways to support underestimated founders, I would love to talk more. To connect, please complete this form and I’ll be in touch.



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