Home Leadership Turn Archives Me RampUp Solutions  
 

  • Categories

  • Archives
 

Entrepreneurs: Are Investors Watering Down Innovation?

by Miki Saxon

https://www.flickr.com/photos/hikingartist/3514537597/Innovation isn’t nearly as mind-boggling today when compared to what startups were doing in the late Seventies/early Eighties when I started working with them.

That’s not surprising when you consider who gets funded these days.

A recent Reuters report found that the majority of Silicon Valley startup founders that receive Series A funding come from the same pedigreed cohort: either they previously worked at a large, well-known tech firm, a well-connected smaller tech company, they previously created a successful startup, or they come from one of three universities—Stanford, Harvard, or MIT.

Not surprising when you consider the attitude of Valley stalwarts like Paul Graham of Y Combinator, who publically stated that he would be unlikely to fund someone with a strong accent or a woman.

It’s been 15 years since I first wrote about the proclivity of managers to hire people like themselves and more over the years showing it leads to homophily and the negative impact that has on a company.

It seems it’s no different for investors.

They are funding people like themselves who were raised, educated and worked along paths similar to their own who they either know or are introduced to them by a friend.

“Like a lot of the investments [Instacart] that have come our way, a friend of a friend talked to us about it, and told us about it, and encouraged the founder and the CEO to come and chat with us. One thing led to another.” –Sequoia partner Mike Moritz

When you fund from a homogenous group, no matter where they are, creativity and innovation are watered down, because those groups tend to be insular and badly interbred talking mostly to each other.

If you’re fishing from a pond of rich white guys, you’re only going to get ideas that address the needs of rich white guys.

AKA, people like themselves.

Flickr image credit: HikingArtist

Leave a Reply

RSS2 Subscribe to
MAPping Company Success

Enter your Email
Powered by FeedBlitz
About Miki View Miki Saxon's profile on LinkedIn

Clarify your exec summary, website, etc.

Have a quick question or just want to chat? Feel free to write or call me at 360.335.8054

The 12 Ingredients of a Fillable Req

CheatSheet for InterviewERS

CheatSheet for InterviewEEs

Give your mind a rest. Here are 4 quick ways to get rid of kinks, break a logjam or juice your creativity!

Creative mousing

Bubblewrap!

Animal innovation

Brain teaser

The latest disaster is here at home; donate to the East Coast recovery efforts now!

Text REDCROSS to 90999 to make a $10 donation or call 00.733.2767. $10 really really does make a difference and you'll never miss it.

And always donate what you can whenever you can

The following accept cash and in-kind donations: Doctors Without Borders, UNICEF, Red Cross, World Food Program, Save the Children

*/ ?>

About Miki

About KG

Clarify your exec summary, website, marketing collateral, etc.

Have a question or just want to chat @ no cost? Feel free to write 

Download useful assistance now.

Entrepreneurs face difficulties that are hard for most people to imagine, let alone understand. You can find anonymous help and connections that do understand at 7 cups of tea.

Crises never end.
$10 really does make a difference and you’ll never miss it,
while $10 a month has exponential power.
Always donate what you can whenever you can.

The following accept cash and in-kind donations:

Web site development: NTR Lab
Creative Commons License
This work is licensed under a Creative Commons Attribution-NoDerivs 2.5 License.