Who Are Venture Capitalist?

Venture capitalists act as a gateway for companies on the potential brink of success, providing a vital financial stream to young start-ups and small companies. The tech and finance industry are notorious for their lack of diversity across many demographics. Notably, a 1500 person study conducted by Richard Kerby found that over 80 percent of U.S. venture capitalists are men and 70 percent of venture capitalists are white. A little less than half went to one of two schools: Harvard or Stanford.

The lack of race, gender, and educational diversity contributes to the cyclic problem of diversity in tech. Venture capitalist fund people and ideas that have worked in the past, with a phenomenon commonly known as “pattern matching.” When past patterns have lacked diversity, future patterns will lack diversity. Startups founded by women received only 2% of venture capitalist funding. That causes the insularity of venture capitalists to ripple out, ultimately influencing the makeup of the tech industry by determining which companies get vital monetary resources.