Skip to navigationSkip to content
Close

The 2010s completely transformed venture capital. Until fairly recently, venture capital was a niche industry made up of a small number of firms in Boston and Silicon Valley. Today it’s comprised of some 2,000 companies around the globe. In this week’s field guide, Quartz looks at how bigger funds and bigger deals are keeping startups private longer—and fueling inequality. ✦

Read more on Quartz

Featured contributions

  • There's a double-edged sword effect on venture capital money into the startup world. The crazy thing is, from a 2013 Fundable study, less than 1% of successful small businesses took VC or angel money.

    The winner: credit lines, at 30%.

  • VC growth, from investments to capital gains from exits, are truly ground zero for anti-diversity arguments. How much more data do we need, and how much more income and fund opportunities should remain segregated before this industry is called into accountability for its sheer resolve to remain homogeneous

    VC growth, from investments to capital gains from exits, are truly ground zero for anti-diversity arguments. How much more data do we need, and how much more income and fund opportunities should remain segregated before this industry is called into accountability for its sheer resolve to remain homogeneous? There has been so much talk about the inequality that persists in the non-bank investment field (the leadership of nearly all firms are overwhelmingly white, male, cisgender, heterosexual; the fund managers are the same, and the returns go to their families and often-segregated home communities around the US). Yet, the industry is largely unregulated and without accountability for the costs it pushes onto government, nonprofits, universities, and others who pick up the slack of reallocating diverse labor to other fields that arent so staunchly entrenched in non-dicersity. Less than 3% of all funds invested in the US by VCs to startups go to women and people of color....combined. Harlem Capital, one of the very few black owned VCs, found the number to be 2.7%. Three quarters of VC firms in the US have ZERO women on staff. With such lucrative wages and returns, side by side with the majority of math degrees and STEM degrees going to women, this means capable people are being disregarded and left out. It also, inherently, means the returns to labor and investment are going to men, and white households...which sends ripples throughout the economy.

    Money is to be made. Money is being made. By white men. The billions that have been reaped over the last decade mostly went to them, their families, and their dreams. To invest in an entrepreneur is to say that their vision for the future is worth the world living in. The validity of the visions that brilliant, bold people have are being racialized and genderized due to the continual demand for homogeneity. This isnt an indictment, it's a call to accountability, care, and community in a nation filled with brilliant people of color leading catalytic small companies, indigenous leaders with compelling ideas and track records, LGBTQIA+ entrepreneurs who see the market advantages in a community, and non-male founders locked out of a system that says there is little they can do to stop making sure the white guys stay out front like they always have. People of color like myself work hard to combat these data points and realities, yet the inertia against us is an incredible force, and moves at the pace of white male fragility.

  • A good point to make is that the venture capitalist market was able to boost the net economic benefits of the startup economy. The market was able to contribute to tech and innovation evolution across industries which made it an essential part of 21st century economics.

  • It's easier to pour more money into startups than it is to increase the number of quality startups available to fund. More funding does pull in more entrepreneurs, but eventually increasing the number of startups requires more public investment in science and R&D, policies that make entrepreneurship

    It's easier to pour more money into startups than it is to increase the number of quality startups available to fund. More funding does pull in more entrepreneurs, but eventually increasing the number of startups requires more public investment in science and R&D, policies that make entrepreneurship an option for more people, and more-competitive markets that give new companies the chance to succeed.