Michael Stewart is the Founder of SimpleInsight a company which has a mission to improve the funding that is received by underrepresented founders in the tech ecosystem. They help startup founders who are female, black, and from the LGBTQ+ community. SimpleInsight is a unique mix of Accounting, Data, Emerging Technology, and Digital Transformation. The world needs change and companies becoming more diverse, containing more diverse leaders and leadership teams will become pivotal in the advancement of unsolved social and technological problems. SimpleInsight is here to support startups and SMEs to build robust companies led by underrepresented founders and help showcase them as the great enterprises of the future, they will become.
The need for diversity in the tech ecosystem?
If we stay as we are nothing is going to change, if the people who are in positions of influence don’t change their views all the prejudice that is entrenched into the tech ecosystem is going to get accelerated.
Why do we think this? The rise in the use of artificial intelligence (AI) is currently in accelerators and incubators across the world. It attracts funding from the investment community seeking a healthy return for their investors.
If too much funding is added to a poorly structured startup idea it can lead to a startup failing. If artificial intelligence is added to the system of prejudice we have in the tech ecosystem, it will accelerate what we have in place now, which is not going to be good for founders from underrepresented backgrounds.
Diversity of thought and data is needed in the tech ecosystem, especially where AI is concerned, and this should be wrapped up in any conversation we have on ethics. We may have had a global AI conference last year, but how much of the diverse community feedback will be acted upon about ethical issues concerning diversity in AI?
Can we expect big company culture to change?
“Culture eats strategy for breakfast” by Peter Drucker
We think it is very difficult for larger companies to change something that is so systemic, such as sexism, homophobia, or racism at pace. These types of discrimination are not just in the tech sector but remain present in every facet of everyday life.
It’s like an unspoken code that when any power is to be distributed, it kicks in automatically and makes sure the status quo is maintained. The status quo is where one group of people consistently are presented with all the opportunities within the industry and the system is setup so that a specific group of people can flourish within it.
This is not to say it can’t be overcome, but true accountability for change must be demonstrated and if not acted upon, financial penalties should be put in place so that organisations take the change needed seriously enough.
Lots of large companies have pledged to improve discrimination in recent times, but we keep defaulting back to no change after the deaths of Sarah Everard, Brianna Ghey, and George Floyd.
If you are a woman, black, or from the LGBTQ+ community or find yourself in two or all of these groups, you have to deal with pressures that white males in positions of influence and power are not exposed to. It is not to say that all white males are bad, some are allies but we just don’t have enough allies to create lasting change, we need to find more allies and encourage them to help.
A reason why we have so few diverse leaders in the tech ecosystem, is that Diverse leaders are more likely to enact change as they can identify more with the issue of prejudice, and therefore look to seek change, as opposed to what happens currently which is to avoid change and stay quiet.
Why is it better to start right at the beginning with new smaller companies?
The culture hasn’t been defined yet so part of what we do at SimpleInsight is to educate the Founder or Co-founders on the advantages of having a diverse workforce if they don’t have one already.
There is more chance of a diverse workforce being created if the leaders come from diverse backgrounds.
We see this dynamic in younger companies being constructed with a diverse leadership mix. This is one of the reasons we’re working with startups and SMEs to ensure that diversity becomes part of their DNA. There is enough research in the public domain to state that diversity is profitable, what should happen next is action not another piece of research.
If these smaller companies scale to larger entities, it then becomes very difficult to change culture unless leadership at various levels is wiped out. It would be difficult for a big company to do this and successfully maintain its operations safely, hence being another reason bigger companies shy away from the change required to improve diversity. Unless change itself is properly organised within a diversity and inclusion program backed by the board which becomes an integral part of a large organisation’s purpose, then it simply fizzles out and doesn’t happen.
Is there a way to improve the pace of funding for underrepresented founders?
The world is becoming ever-dependent on technology, and undoubtedly technology will be used to readdress the balance of underrepresented founders not getting enough funding. These are the founders that we like to support female black and the LGBTQ+ community.
Platforms have been used in the past but what has been controlled is the level of funding available. It is the funding source and who controls it that matters the most because the withdrawal of funding stops efforts from scaling.
Blockchain could help in this area, by ensuring unconscious bias is removed in the investment decision to fund startups.
If a decentralised methodology was followed then a funding source could be created with a set of rules in a smart contract with bias excluded, supported by a community of funders, that have a vested interest in that community being funded which could be a shared interest of funding for underrepresented founders’ startups.
This does exist already it’s called a Decentralised Autonomous Organisation (DAO) and there are many various types in existence today.
“A Decentralised Autonomous Organization (DAO) is a legal structure that has no central governing body and whose members share a common goal to act in the best interest of the entity. It was inspired by the decentralisation of cryptocurrencies and blockchain technology”.
So, this legal structure is based on the same technology blockchain, that Bitcoin uses and which the SEC has just approved trading in recently. (Jan 2024)
Surely this structure needs to be investigated to understand the potential of underrepresented startup founder communities funding themselves.
For underrepresented founders, this would be an interesting concept, but what is even more interesting is the number of these founders who could build such a structure if they collaborated with their underrepresented friends.