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If there is VC racism, doesn't that also mean there is a market opportunity for VC money to focus exclusively on African American tech startups. Even if there aren't many, there appears to be zero competition selecting investments. The author is rightfully frustrated. But instead of focussing on lack of interest in their app, maybe there's a bigger opportunity here.
Backstage Capital (https://backstagecapital.com/)
If there is VC racism, doesn't that also mean there is a market opportunity for VC money to focus exclusively on African American tech startups. Even if there aren't many, there appears to be zero competition selecting investments. The author is rightfully frustrated. But instead of focussing on lack of interest in their app, maybe there's a bigger opportunity here.
1. You’re focussing on a much smaller subset of the market. It may be hard to find enough investments
2. It is probably illegal.
3. You may not get the best VC’s. The best VC’s will focus on total return and probably fund from a wide pool to find rare outliers that may grow huge. So founders may have worse VC experiences. VC includes mentorship, network etc, so this could hamper startup success.
4. You may also not get the best African American startups. The very best will be able to get attention from the top VC firms. So, there will be an adverse selection problem for any VC specializing in African American startups
#2 is probably the main reason no one has tried. But #3 and #4 in combination are also deadly.
But, if discrimination is a factor in startup funding, there would certainly be a market opportunity for VC’s to focus more attention on underserved groups.
Edit: Another poster points out backstage capital is doing this. So, maybe it doesn’t violate any laws? I’ll be very interested to see how their returns are over time. They fund women and people of color. They may well have hit on a market opportunity.
Found this article when I searched Backstage capital on HN. They’re a startup too it seems: https://news.crunchbase.com/news/founders-arent-giving-up-on...
Does she offer any actual evidence that she was rejected due to racism? She just seems to assume it.
Please don't post flamebait or snark to Hacker News. Would you mind reviewing the site guidelines? Both of those are deprecated, and there's this, too: " Comments should get more thoughtful and substantive, not less, as a topic gets more divisive. " https://news.ycombinator.com/newsguidelines.html
The part about Nguyen was frustrating. It's hard to imagine a more honest hypocrisy than explicitly saying, on the record, that one will be forthcoming and helpful towards the marginalized, and ending up being just as dismissive and unengaged as everybody else.
In the context of wrong stage/check size, Alfred's response was reasonable.
Does she offer any actual evidence that she was rejected due to racism? She just seems to assume it.
One potential confounding issue is that her husband is a former Google engineer, and she doesn't mention having any similar experience. It wouldn't be surprising if a VC's vetting process involved checking linkedin to see what experience the person had, and giving points to former FAANG engineers (note: I am not in this category).
Regardless, it's still pretty lousy that VCs that claim to want to help certain types of founders don't even respond to inbound inquiries.
Does she offer any actual evidence that she was rejected due to racism? She just seems to assume it.
The part where she doesn't get a response when using her email but does when using her partner's email is pretty convincing. There are many studies that gauge racism in hiring by sending out resumes that only differ in candidate's name.