Following Women’s History Month, it is important to evaluate diversity in Michigan’s entrepreneurial and investment community because of its economic impact.
Recent studies show that 11 percent of venture professionals are women, despite comprising over 46 percent of the U.S. Labor Force. In Michigan, just above 14 percent of venture capitalists are women.
Research shows that 63 percent of startup companies with a woman on their founding team outperform those consisting of only men, giving investors an economic reason to value diversity. In Michigan last year, $222 million was invested in 54 Michigan startup companies. Of that, $16.9 million was invested in four women-led startups.
Emily Heintz is associate director of the Michigan Venture Capital Association.
Given that, we have the opportunity to build a more robust entrepreneurial and investment community.
At Michigan Venture Capital Association (MVCA), our Diversity & Inclusion Initiative is a key component of our five-year strategic plan. In 2014, the association began researching the presence and roles of women, individuals who identify as LGBTQ+ and racial minorities to identify program and policy needs. Earlier this year, the MVCA Diversity & Inclusion Initiative was incorporated into the Michigan Venture Fellows Program, a talent program that aims to attract and retain venture capital professionals in Michigan.
Diversity and inclusion should be foundational. For example, an important component of MVCA is providing opportunities for entrepreneurs, venture capitalists, economic developers, and universities to connect and grow networks; however, it is critical for Michigan’s entrepreneurial and investment community to not only have an extensive network, but a diverse one. As part of the MVCA Venture Fellows Program, the association now encourages Venture Fellows to attend a broader range of conferences and networking events to provide more opportunities to diversify their networks. In addition, Venture Fellows will participate in educational sessions, such as MVCAcademy, on addressing biases in the workplace.
Seemingly small initiatives can make a significant impact. According to Kate Mitchell of Scale Venture Partners, organizations can foster a more inclusive environment by changing social behaviors in the office. For instance, let’s say an employee with a leadership role needs to attend a parent-teacher conference or watch his or her child’s violin concert; instead of marking these events as private appointments, he or she should be loud and proud of it!
Allow employees to see that leaders in the organization are setting aside time to have a work-life balance, and through these actions, show them that being a parent and having a family will not impact their work performance.
There’s still a lot of work to do, but through education and implementation of these initiatives, we can ensure a healthy and vibrant entrepreneurial and investment community. Fostering an inclusive organizational culture and expanding our networks can go a long way in attracting and retaining top talent. By working together on diversity and inclusion initiatives – and examining trends to identify gaps - we can cultivate leaders that have the values and education needed to advance Michigan’s entrepreneurial and investment community.