The Labour Party recently published Start-Up, Scale-Up, which provides crucial insights on how the party aims to achieve one of the guiding ambitions of a potential future government: to make Britain the best place to start, and to grow, a business. In this virtual roundtable, we will bring together policy makers, investors, and founders to discuss the findings.
Section five of the report includes discussion of ethnic minority founders, leading with the Extend Ventures statistic that “0.24% of all venture funding between 2009 and 2019 went to Black founders, a figure that declined to 0.02% for Black female founders – a sum far lower than the population representation of 3.5% (18% in London).”
The report is clear: “the disproportionately low amount of VC funding going to women and founders from ethnic minorities is not simply because of a ‘supply’ or ‘pipeline’ problem.” One respondent to their call for evidence calculated that if entrepreneurship among ethnic minority founders was increased to the average level, this could add a further £15-20 billion to UK GDP.
Among other things, the report highlights:
the importance of data gathering – even measuring the scale of the problem creates momentum for change, as well as informing policy-makers and market participants about the types of issues to be addressed;
the barrier of ‘mirrortocracy’ at the funding table – the idea that the lack of diversity at senior levels in funders biased investment decisions against founders from ethnic minorities;
the challenge of raising very early-stage funding – limited debt funding and lower home ownership rates amongst some ethnic groups represent a significant barrier to many starting a business;
the potential of an Investing in Ethnic Diversity Code, similar to the Investing in Women Code.
This virtual roundtable will be opened by Tom Adeyoola, who sat on the panel of the Labour Startup Review, which produced the report. Tom is a technology entrepreneur passionate about disruptive technology for societal and climate good. He was CEO and Founder of acquired apparel technology scale-up Metail (2008-2019). He is currently a cofounder of nonprofit Extend Ventures, which aims to diversify access to finance for underrepresented founders through data and research. He also serves as Non-Exec Director for zero carbon monitoring consultancy Verco and environmental behavioural change start-up ‘Do Nation’. In addition, he is an active angel investor, chair of mindfulness app Spoke, governor of his former school St. Paul’s, member of the London Mayor’s Business Advisory Board and served on the board of the women’s personal wellness scale-up Elvie (2013-2017). Tom was also involved with the creation of the Seed Enterprise Investment Scheme (SEIS).
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