Racial and gender biases have long impacted nearly every industry imaginable. It’s no secret that marginalized communities, who were historically left out of opportunities for advancement, often fall flat in terms of equity in comparison to their white counterparts.
When it comes to equal pay, recent data shows that despite the gender pay gap shrinking, women make only $0.82 per every $1 their male counterparts make. Women of color, however, make even less. Native Alaskan women make $0.71, Hispanic women make $0.78 and Black women make $0.79 per every $1 their white, male counterparts make.
This same disparity exists when founders of color pursue venture capital funding for their startups. A study from DocSend that was released in July, revealed that startups with all female, minority co-founding teams raised an average of $860,000 in their pre-seed rounds after 74 meetings with investors. On the other hand, startups with white male co-founding teams made roughly the same amount of funding — $850,000 on average — in their pre-seed rounds in half the number of meetings.
Seed rounds often set the tone for a startup’s ability to enter a market. Considering the fact that data shows Black women are underpaid in the workforce and women of color founders broadly are underfunded, it leaves room to wonder what executives in the space are doing to combat pay disparities.
Built In sat down with five tech executives to talk about equal pay, venture capital funding and defeating racial bias.
Combating Pay Inequality
Esosa Ighodaro-Johnson and Regina Gwynn co-founded Black Women Talk Tech (BWTT) in 2017 to help Black women navigate the tech landscape. Through BWTT, Black women are able to find community while also receiving access to resources on how to better navigate tech careers or even founding their own tech companies.
“It is our mission to close the gap between Black women and their peers who are in the same workspace, yet do not have an equal playing field in terms of wages earned and received,” Ighodaro-Johnson and Gwynn told Built In via email.
This effort alone is extremely helpful according to Lauren deLisa Coleman, the founder of GameChange. NYC-based GameChange is an initiative to support women of color who are developing innovation through emerging tech and mass media entertainment.
“Our perspective is that it’s not the women and people of color that need to change and contort to a system that’s broken. It’s the broken system that needs to change.”
Coleman shares a similar sentiment to Ighodaro-Johnson and Gwynn who all agree that driving accessibility to tech resources and distributing them with equity in mind is one of the first steps to combating pay inequality.
“Nine times out of 10, women of color — especially Back women in [tech] — already have the education and everything for God’s sake,” Coleman told Built In. “It’s about the relationships and the visibility at this point. It’s condescending to say anything else.”
Solutions at Work
Outside of BWTT, Ighodaro-Johnson and Gwynn partner with Fortune 500 companies and large tech enterprises to help them build out their diversity, equity and inclusion (DEI) initiatives and hire people of color, especially Black women.
“We’ve always been leaders at the community level but weren’t acknowledged before,” Ighodaro-Johnson and Gwynn said. “There are already statistics that prove that diversity in leadership yields a better return on investment and product [and] innovative solutions for the marketplace. It will inherently increase the quality of life for more people if this happens more often.”
When it comes to leading employers to better serve their staff, including ways to be mindful about pay gaps, Amy Spurling, the CEO of Boston-based employee stipend management software Compt, knows a thing or two.
When it comes to running Compt, Spurling believes in providing interested applicants full transparency about their potential salary and why the company chose to create the current benchmarks in place for each role. Spurling and the Compt team fuel this effort by basing employee salaries on market data from companies that are similar in growth and size. This data is public and available to everyone which enforces Compt’s decision to not let interested applicants negotiate salary.
“We don’t negotiate because that keeps us from having that pay gap out of the gate,” Spurling told Built In.
Instead, Compt adjusts employees’ salaries once a year based on what is happening in the market for similar positions.
In regards to the gender pay gap, Spurling finds it appalling but does not believe that most modern companies set out with the intent to create a gap in the first place.
“I don’t think it’s quite that that most companies in this day and age come out saying, ‘I want to pay one group less than another group,’” Spurling said. “But, that’s the reality of where we’re at and what is happening. So, we do need to make changes to make sure that doesn’t continue.”
At Compt, Spurling focuses on building a culture that relies on a sense of belonging by making sure that her staff is full of diverse perspectives and ensuring that they don’t have internal pay gaps. She encourages other companies to recognize the importance of doing the same and advocates that they should.
“Companies need to be more transparent in what they’re paying people,” Spurling said. “ We shouldn’t be arguing and negotiating over a couple $1,000 here and there as employees. [Negotiation and equal pay] shouldn’t be some taboo thing.”
Funding With a Purpose
Daryn Dodson, managing partner at Oakland, California-based venture capital firm Illumen Capital, told Built In that outside of providing capital to its portfolio companies, the firm also focuses its efforts on helping startups and founders reduce implicit bias towards women and people of color.
The firm does this by establishing long-term relationships with its portfolio companies and constantly evaluating their processes related to hiring, retention, promotion and attracting talent. Dodson said the firm also helps companies evaluate its executive hires and board selection practices.
“Part of the reason why we invest in firms and then work with them for 10 years on reducing biases is we find that if we don’t keep after these biases within firms at all levels, they creep back in,” Dodson said.
When accountability is lacking and there isn’t a force in the room to drive equitable change, challenges that Black women face in tech persist. The same goes for all marginalized groups.
“Our perspective is that it’s not the women and people of color that need to change and contort to a system that’s broken,” Dodson said. “It’s the broken system that needs to change.”
As the tech ecosystem continues to evolve, these executives are confident that change is on the horizon because they won’t give up their efforts to drive it.