Black In America: How Silicone Valley Culture Shuts Out Black Entrepreneurs

November 14, 2011

CNN has been running a series called inAMERICA and in one of the series’ episodes, Black In America hosted by Soledad O’Brien, they highlighted the role black entrepreneurs play in Silicone Valley. Silicone Valley is a mint and the companies there are minting money by the truckloads. But, why is it that very few minorities have successful startups in “The Valley”, as it is fondly known? The answer may lie in culture or trends that have been doing the rounds in Silicone Valley since the eighties. Think about the typical startup DNA: Ivy League drop-out with a killer idea and self-taught ninja skills. Add to this that they have a god-father who is some high-flier in either the tech circles or financial circles. Sounds familiar, right? Facebook, Google, etc, etc, etc. This profile, however, more often than not fits the male Caucasian demographic.

The basis being that for Venture Capitalists trawling the Valley for the next Google, the fact that they have to look at hundreds of applications every year dissuades them from breaking camp with this culture; the truth being that it makes their work easy and it pays off. So yes, there may be some minority group entrepreneurs with killer ideas but the fact that they are just another statistical blip in the radar of the VCs in terms of the cumulative number of applications they have to look at makes it hard for them to put their foot in the door. Speaking of statistics, there is a higher statistical probability that a non-minority entrepreneur will get attention owing to the larger number of non-minority entrepreneurs in the Valley pitching their ideas to anyone who will listen. In other words, too few minority entrepreneurs are taking their ideas to the Valley in the first place.

The other issue that is altogether glaring is perceptions. One successful entrepreneur who is of Latin decent said explicitly that when he had to pitch his idea to a bunch of VC’s, he hired a tall, white polished-college-graduate-looking guy to pitch for him. Why? Because of perceptions. But this does not seem to put the matter to rest. To me, the biggest issue is patronage. One startup CEO said that the biggest challenge minorities face is that they are held to a significantly lower standard than those non-minority startup entrepreneurs are held up to. This results in these minority initiated startups creating mediocre products and services that ultimately cannot stand the test of time and get overtaken by failure. Her advice: every minority startup should start by first creating a very high value system against which they will measure their efforts.

The series is currently attracting a deluge of responses on Twitter and user comments can be followed under the hash tag #blackinamerica

I’m in sixes and sevens about the series so help me out, what are your thoughts on the Black in America series about black entrepreneurs in Silicone Valley?