Though Silicon Valley’s highly competitive and innovative, it’s missing a huge arbitrage opportunity: communities of color. Contrary to what one Forbes contributor recently argued, there is a diversity problem in technology. We all should know the stats: just one percent of Dropbox employees are black, two percent at Google, Facebook, Yahoo and Twitter, compared to African-Americans comprising 13 percent of the U.S. population. Hispanic employees comprise between three and five percent at those same companies, despite the fact that Hispanics are 17 percent of the country.
A 2014 list of the top tech venture capital firms shows just 1.54 percent of investors were black, and just 1 percent of tech startup founders were black,according to CB Insights. Asian-Americans are disproportionately represented in tech startups, yet research from Pepperdine University’s Graziado School of Business and Management found minority-owned companies are 22.2 percent less likely to successfully raise a venture round than companies run by American-born white males.
This isn’t to say we need rigid, racial quotas in tech, and in fact, economics tells us that sort of rigidity is bad for consumers. But there are many things, some of them pretty basic, we as a society can do to boost communities of color in a sector with such hyper growth and value creation.
VC investors, for example, can stop suggesting to African-American entrepreneurs that instead of building a tech company they start a bodega, as black entrepreneurs Chike Ukaegbu and Steve Nson recently discussed. We can expose children of color to computer science, coding, 3-D printing and other technologies from an early age, something we’ve broadly failed to do (Facebook founder and privately-schooled Mark Zuckerberg had this luxury–learning software programming from a private tutor), particularly in our urban areas. We have not built a robust culture around STEM (science, technology, engineering and math) education. Here in New York City, a new initiative by Mayor DeBlasio called Computer Science for All aims to teach tech in all public schools by 2025. This is nice, but the question is, why will it take so long? And why isn’t this something we see nationwide?
Beyond tech and into general areas of entrepreneurship, people of color, particularly Hispanics, are better represented and have made some strides in the past generation, according to research by the Kauffman Foundation. But the technology sector is where the most value creation and innovation is taking place; soon every company will be a software company. And in this area, communities of color are falling further behind.
It was heartbreaking to watch as protesters and rioters, some belonging to the Black Lives Matter movement, destroyed black-owned businesses in Baltimore and Ferguson in the aftermath of the tragic deaths of Freddie Gray and Michael Brown. Yet the deaths of these men underscored much deeper issues within African-American communities. While there are vigorous academic and political debates about the causes and cures for these ills, activists with a black-owned firm called Silicon Harlem see that the mentality of an entrepreneur is one antidote to feelings of hopelessness and dystopia. And as John Sviokla and Mitch Cohen describe in The Self-Made Billionaire Effect, one needn’t found a company to create massive value: entrepreneurialism is a mindset.
Expanding the entrepreneurial mindset is the mission of Silicon Harlem, which aims to transform Harlem into a tech and innovation hub. It seeks to lower, then eradicate, crime in Harlem, expand employment, and increase quality education opportunities in this epicenter of black culture.
“Silicon Harlem ultimately is an initiative that not only focuses on Harlem, but we believe the model can be replicated in all urban areas, in an Indianapolis or Baltimore, or even a Ferguson,” Silicon Harlem founder Clayton Banks told me. “Most urban centers are going to have to translate into tech and innovation hubs. For the U.S. to stay competitive in the world it’s going to require all of us to embrace STEM. It’s going to require all of us to focus on tech skills.”
Over the past year I have worked with Banks and many others in Harlem toward expanding opportunities in tech. On Friday, I will be speaking, along with many others passionate about social justice, at the Silicon Harlem annual conference. We have representatives from Uber, Meetup.com, Mic.com, BuzzFeed, HBO, venture capital firms and many other companies joining together to speak on these issues. We hope you will join us in this worthy cause.
Read the original piece in Forbes here.