Ecosystem builders can do more for startups than create investment networks and training programs – they can also foster diversity. In the GIST TechConnect, “Diversity for Success in Business,” a panel of experts talked about ways incubators and accelerators can build an ecosystem with a diverse group of entrepreneurs.
During the discussion, the panel highlighted the reasons why certain ecosystems lack diversity among entrepreneurs. Speaking specifically about Latin America, the panelists explained that many entrepreneurs are marginalized because of race, gender, sexual orientation or finances. As a result, they are not able to start and scale businesses because the barriers to succeed are too high. According to the panelists, this is where an incubator or accelerator can level the playing field.
“I think accelerators and incubators can do a lot, beginning with their different strategies. One is obviously to open their programs up for marginalized groups or different types of people.” said Marcia Chong, an investment analyst for Village Capital. “We must also create programs to connect investors with entrepreneurs and create a shared language where investors are able to say, ‘We will invest at a certain level of maturity. For that we need to look at a team with a, b, c or d.’”
According to Chong, accelerators tend to focus on the entrepreneur and not investors. But if accelerators or incubators also focus on finding investors who are willing and interested in investing in startups with a diverse team, she said there is a higher likelihood that these ecosystem builders will in turn cultivate entrepreneurs from historically marginalized groups.
The panel also said that ecosystem builders do not need to function independently in order to foster diversity – accelerators and incubators can also create diversity initiatives with local governments.
“The government ought to be playing an important role whether they’re the national, regional or local government,” said Agustinho Almeida, director of operations at Ruta N in Colombia. “The local government in Medellin for instance, invests in training programs such as STEM and IT, specifically for women entrepreneurs who are working on a startup. This opens doors for marginalized people.”
By creating partnership with local incubators, Almeida said local governments can give ecosystem builders the tools they need to build a start ecosystem that helps entrepreneurs from minority groups succeed.
Diversity is an ongoing challenge for many startup ecosystems. But through partnerships with investors and local governments, the TechConnect panel said it is possible for incubators and accelerators to help more entrepreneurs from marginalized groups launch successful startups.
To watch the full TechConnect on “Diversity for Success in Business,” click here.