Access to Capital in a Mirror-tocracy

A few years ago, before starting HoneyBee, I interviewed for a role at a tech fashion startup. The management team gave me a tour of the office and I noticed the management, engineering and product team, are male. I didn’t end up getting an offer but a year later, I ran into the CEO, I was curious to know the background of the candidate he ended up hiring so I asked him about it. He said, “I hired my friend from business school because I trust him.” 

How can we gain new perspectives if leadership and investors keep hiring and investing in people they know, like, and trust. Usually, it’s people that look just like them. They share the same background, alma mater, weekend activities, and more. 

According to All Raise, a non-profit organization that started a movement to call out investors in Silicon Valley for not investing in more women, only 12% of decision-makers of US-based venture capital firms are women. And a research commissioned by American Express indicates that while women own 40% of U.S. businesses, they generate 4.3% of business revenues, and they receive just 2.2% of tech venture funding. And for women of color? That figure is a paltry 0.0006% of tech venture funding. 

Since 2016, HoneyBee has funded millions in loans for those in need of quick, affordable cash. We’ve helped working Americans improve their financial health by re-orienting their budgets, filling out forms for government programs, tackling tough money conversations, and increasing their 401(k) contributions. 

Since my co-founders and I started HoneyBee, I’ve pitched to 130 investors, out of which 5 were women. The investors all knew each other, had similar backgrounds and interests, most of the investors couldn’t fully grasp the impact opportunity for providing a responsible and sustainable financial wellness solution for a marginalized community, for people of color and women. But I also understood why they couldn’t relate, how could the 1% of America understand that there were Americans that needed $100 to cover gas and food when they’ve never experienced an overdraft fee in their life. I spent most of my pitch explaining how the majority of Americans struggled to get by. We created HoneyBee because 78% of Americans live paycheck to paycheck, and more than 40% can’t cover a $400 unexpected expense.  I needed to find someone who could connect with that. I needed a more diverse array of investors. More women. More people of color. More immigrants. 

I needed to find investors more like me.  

Silicon Valley represents innovation and our hope for building a better future thus it’s crucial that women and immigrants play a part. There’s a huge need to shake things up. We need more people from all walks of life involved in the funding process. I have no doubt that more diverse investors would yield more investments in innovative companies solving problems for people in their communities. 

It’s time to change the way things have always been done.