Diversity in Tech - The tech population doesn’t reflect the true population

By: Jason Moriber
Wayne Sutton, co-founder and CTO of Change Catalyst, is working to increase diversity in tech

The vision for this series is to surface and share the experiences, trends and insights of thought-leaders, trail blazers, and subject experts who either live at the cutting edge of technology and/or seek to make the world a better place. We can each learn from these experiences and potentially take the first steps towards making the innovations that matter to us.

Though it was a sunny, 68-degree day down on the streets of San Francisco, it was much hotter up on the roof of Wayne Sutton’s building in the SoMa neighborhood. We were meeting on his roof deck after finding the music too loud to hold a conversation at the famous food court next door. To our right, a crew of window-washers was preparing their skiff to be lowered down the side of the glass tower. Their rectangular booth-cage rocked as if it was on water, held aloft by a swing arm and cables. The armature seemed too modest to hold the weight, but the washers were confident in their balance as they jumped in and out of the vehicle without belts or hooks. We couldn’t see the ground from where we sat, just the clear view of the sandy-toned hills and the Pacific Ocean in the distance.  

Wayne wasn’t fazed by their activity. Wayne has the focus of a charming listener, a confidence in his knowledge, and occasional moments of impatience or frustration…he has a mission, he has things to do, and there’s a definite urgency to get to work.

The numbers are bad

“If you look at numbers, it’s 60 percent White males in Silicon Valley,” Wayne states, with a trace of disappointment mixed with a passion to make a difference, “then the highest ethnic population is Indian men and Asians, but everywhere else in the county it’s mostly White males and that’s it. And then you look at African Americans, it’s 2 percent and Latinos are around 1 percent. Women are 16 to 30 percent, in that range; nowhere near the real numbers in America, of the American population.”

Looking at recent census data, the topline US demographics are:

  • 63.7% White
  • 12.2% Non-Hispanic Black
  • 4.7% Non-Hispanic Asian
  • 16.3% Hispanic
  • 49.2% Male
  • 50.8% Female

The data alone spells out the imbalance between the tech world and the general numbers. Two percent Black and 1 percent Hispanic in tech present a large gap, not to mention the huge disparity in gender. Though women make up 59 percent of the workforce, only 15.6 percent are in Tech.

Wayne then explained what he and his organization are working to make an impact on these numbers with, What I’m working on now is the Tech Inclusion Conference series. At Tech Inclusion we focus on five different areas of impact that we feel like solve the devotion and inclusion of tech problems. The five areas are education, workplace, policy, entrepreneurship and ecosystems. We did a company retreat to look at the diversity in tech problem and everyone was at the beginning level, really. They focus just on women or K-12. So we do the Tech Inclusion Conferences to really focus on the ‘each-other model’ to see what works, what doesn’t work and to convene people together to fix the problem together. Also we built a community platform that we love, the online and offline model. So people we bring in together offline want to connect online and connect companies to talent as well.

“The first Tech Inclusion Conference we did in San Francisco was with incredible people from across the world; from different demographics, such as White, Black, Latino, LGBTQIA, veterans, people with disabilities, and everyone could learn from each other. After the conference, people wonder what happens next, right? Where can people go to continue to find resources about what they are working on? Where can people go to say, ‘I met someone at the Tech Inclusion Conference, I didn’t get their card, but I heard them speak and I want access to them and I don’t want to do so over LinkedIn or Facebook.’ Convene people online and continue that knowledge share. And that’s valuable.”

When are you going to realize that in the 60s and 70s, when Silicon Valley was being formed, the government contracts for microchips back then, that’s how billions of dollars started moving into this area. African Americans were fighting for civil rights. So African Americans were just trying to get the right to vote, we were trying to get equal pay, and Silicon Valley was beginning to make millions and billions in the marketplace…

“Can you speak a bit about how this inclusion gap in tech happens?” I asked, and Wayne tilted his head slightly backwards, to take a deep breath. His shoulders rose as he inhaled, then he shared a timeline I hadn’t heard of.

Silicon valley got rich while African Americans fought for civil rights

“Yeah that’s a great question; I’ve thought about this a lot. So why doesn’t Silicon Valley and the tech industry look like the rest of America? There’s a lot of culture in the history of America and it plays a big role in what it looks like now. Somebody gave me a great example, an African American tech founder said, ‘When are you going to realize that in the 60s and 70s, when Silicon Valley was being formed, the government contracts for microchips back then, that’s how billions of dollars started moving into this area. African Americans were fighting for civil rights. So African Americans were just trying to get the right to vote, we were trying to get equal pay, and Silicon Valley was beginning to make millions and billions in the marketplace. So we’ve been playing catch-up since then. So that’s the history of America.’”

I hadn’t heard this point of view before, but it hit me hard when he shared it. A whole generation of people who were merely trying to obtain civil rights while the foundation of future wealth was being built, in a remote academic corner of the country, outside of the access of most people. It would take decades for this foundation to become what it is today, but you wonder what the history of tech would look like if those government grants weren’t awarded until a decade later.  

“And more recently?” I asked, “What are those barriers?”

The cycle of mimicking earlier tech generations is keeping diversity out of tech

“You have this gentrification that happened years ago here in San Francisco,” Wayne explained. “I moved to San Francisco in 2012 from North Carolina and at that time San Francisco was a very diverse area; it used to be heavily populated by African Americans, Asians and Chinese. But now it’s mostly Whites and Asians and very few African Americans. Sure, Oakland’s next door, and Silicon Valley is getting more Latino populations, but there are still very few African Americans. Latinos are here but they are not in tech. So we got to look at why that is. You have to go back over the years to answer that.

As example, what’s the application process like for Stanford and the American education system? If tech industries recruit from Ivy League schools, the Berkleys, Stanfords, MITs, and Harvards; who is applying?

“When you think of the history of America and the history of Silicon Valley, think of how many billion and trillion dollars that have been made in this community that is connected to Stanford University. The Google founders, who graduated from Stanford, pull most of their colleagues, so the whole core of employees is from Stanford. And almost every single tech company since Google has been copying Google’s model of success in terms of hiring, finding talent, best practices, creating teams and recruiting. Because look at Google, it did work. But that doesn’t mean that there are things that should change or not change right?

“As an example, what’s the application process like for Stanford and the American education system? If tech industries recruit from Ivy League schools, the Berkleys, Stanfords, MITs, and Harvards; who is applying? So all those characteristics impact why the tech industry isn’t diverse.

“What is that? Pattern-matching the ecosystem and culture; and my last point in this is that it’s not just pattern-matching, it’s not just gentrification, or Google and everybody repeating that process. It’s also the values and cultures of diverse communities. African American culture, what we value. Latino culture, what we value. From what we are taught, how are we able to take risks if we are taught not to take risks? Those culture values in our communities are where we were constantly told, at least in my generation, that you go to college, you get a job, you work for your family, and you get a house and get married and all that. And, if we look at the economy in the last 10 years, that’s not the American Dream, that’s the American Debt. Right? And we don’t take risks if we do that, right? And being in the tech industry is all about taking risks.”

Pattern-matching is a term I’ve heard twice before in this series. First with Lisa Morales-Hellobo discussing how to get inner city kids into Tech, then similarly with Kiwoba Allaire as she described her STEM camps for underserved communities.

Throughout our conversation Wayne expressed an optimistic energy, but at times there was a tinge of frustration. The more I listened the more I, too, become frustrated, even a bit angry. The macro forces of culture seem unbreakable. To bring greater diversity to tech is beyond a hiring practice, its deep, its about changing cultures and beliefs. It could mean having to start a new tech foundation, somewhere else, and looking to build over a fifty-year period. It’s no small movement.

So how do you fix this?” I ask Wayne. The sun had moved across the sky and was now shining directly into my eyes. Wayne sat across from me, the sun at his back. We sat under an umbrella that’s keeping the sun off his torso and both of our sets of legs.

New role models are necessary, new networks of people

You fix that in some of the various ways with some of the work that we have been doing. It’s about role models. It’s about showing entrepreneurs who came from different backgrounds who don’t look like Mark Zuckerberg or Jack Dorsey, or come from the Ivy League schools. You have to show individuals with diverse backgrounds that can be just as successful and can create wealth and products that can change the world, like everyone else.

“And another aspect that goes around our impact around entrepreneurship, we have to connect access opportunities for diverse founders. It’s also not just money, but it is networks. The whole Bay Area and tech community is run by this system of referrals, in a network. But if you don’t have referrals in your network, how are you going to recommend someone to this investor, or mention someone for this job, how are you going to vouch for this individual for the founding team? So we have to bring people together and also provide access opportunities.  And that is convened in all of the conferences that we do, through entrepreneur showcases; so we have to show more role models, we have to create more opportunities. And we do have to have capital.

It starts in the schools

“I want to talk a little bit about education. A lot of people focus on the education system of America. People use the word ‘disruption,’ around the education system. Personally I believe the education system is too scrambled right now, from a small community to government level. Most people want less government in everything, people will need our country to do well, and we need more government in the education system to push policies that affect core learning around computer science, logic, technical skills, and the maker movement. We all know those classes we took as kids that we don’t use today. We know those skills have changed as to what people are hiring for now. We do need a really big push in the education system in America that is more towards the jobs of the future.

Companies fill the education gap on the road to employment

“What I feel like companies can do is start their own learning programs. But then they have to hire these individuals and those individuals they hire should come from different parts of America with different backgrounds. So with the whole pattern-matching, same thing with entrepreneurships; without these whole pattern-matching people can be taught these skills. We’re going to see more tech companies with universities attached to them. We’re going to have code academies. We’re going to have Khan academies. We’re going to have code schools that say, ‘If you want to work here, we’re going to train you for 36 months and we’ll hire you if you pass. We’ll help you get in with scholarships.’ Individuals are not going to a university for two or three years for a degree they’re not going to use. The American education system, these core curriculums, and they’re from a corporate perspective with existing code schools, or create your own to hire individuals in the workforce. From an education perspective we need to see more of that to see an impact, for jobs and to create wealth opportunities for all individuals.”

The innovation model, large volume of risk with pinpointed reward

Wayne continued, pivoting toward sharing a higher-level observation about how innovation happens, “Everyone wants to be a venture capitalist. Everybody wants to have their own fund. I’m in that boat as well. But I’ve taken a step back this year to really examine the venture capitalist landscape and entrepreneurship system out here and it really doesn’t work. It has been working, but it’s not a real working model that’s good for the American economy and for the founder themselves.

An average firm is going to look at, maybe, a thousand deals a year. They’ll fund maybe 12, and out of that 12, maybe one is the big win that returns enough capital to sustain the whole firm until they can raise enough for another one.

“As example, let’s take a hundred million dollar fund; an average firm is going to look at, maybe, a thousand deals a year. They’ll fund maybe 12, and out of that 12, maybe one is the big win that returns enough capital to sustain the whole firm until they can raise enough for another one. So you have one out of 12 that may succeed with a return, and the rest of the start-ups funded may succeed or fail. But once the venture capitalists fund these 12 entrepreneurs, they are pushing them for an opportunity for return. It’s like gambling. Go for it big.

“But what about the other 2,988 companies that didn’t get funding? If they can create a company with 30 million a year revenue, 5 million a year revenue, 10 million a year revenue; yet they’re not going to Nasdaq, they’re not going to the stock exchange. But, they can be profitable, they can create jobs. They can hire talent. That’s good for everyone. That’s good for the American economy, that’s good for the entrepreneur, that’s good for the community, but they may not need an aid of 3 million dollars. They may need to get started on that initial capital of half a million, they just need to have the right product, or build a scale and have the right team of mentors and partners around them, and they can still be a successful business. But tell the 200 venture capital firms that and they only want to go for the moon.

“With the accreditation of venture-backed companies, they are creating continued wealth for a handful of individuals whose demographic still doesn’t fit the demographic of America.  The rich are getting richer and the poor are getting poorer. The wealth gap continues to increase. The education gap continues to increase. The access gap increases. And my belief is the whole economy is going to crash if we don’t change. It’s not going to be good for America; it’s not going to be good for the youth. It’s not going to be good for anyone.

“We can’t just say, ‘Oh it’s easy to do a startup.’ I can go to my office and throw up a domain name with my eyes closed. I had a revenue model and everything just do social, get a thousand paying customers, and I got a small business. Five years ago that could have been a serious company. Right? Today it’s not. And we need to stop pushing all entrepreneurs down that path. The market has changed because it is affected by trends and acquisitions by the major key players out here in Silicon Valley. We used to go to Wall Street for influence in America, now we go to Silicon Valley.”

“Ok,” I said, leaning forward in my chair to grab some shade for my face as I ask Wayne a follow-up question, “What’s the solution then?”

Entrepreneurism beyond the valley

More people are seeing that we need different types of funding models for entrepreneurs,” said Wayne. “I think we are going to see different areas succeed in creating great companies and great entrepreneurs in great companies in hubs across the world. I think it’s going to take a lot of time, though, and I think in the next five years, people are going to see what works. Indie.VC has a model that is very favorable for entrepreneurs. There are terms that are evolving but they are great terms, basically it’s like, ‘Here’s $100k as a convertible note and we don’t do anything with the equity unless there’s a big acquisition or the founders get to the point where they’re making millions. And then now we have a stake in the company and convert that into capital. But that’s amazing terms with a small fund. And we’re being very inclusive minded around the companies we are looking for.’ So that is a model, but they’re one out of a million right?

…we are seeing a shift in the entrepreneurship ecosystem to value different cultures.

“It’s going to take a network with some state government funding and some successful entrepreneurs who have done it and paved the way, and then other individuals who are connected to the tech industry. It can’t be the blind leading the blind. That’s just the nature of the beast. And we are seeing a shift in the entrepreneurship ecosystem to value different cultures.

“But if you look at the buying power of the African American communities, or look in terms of women who are 50 percent of the population, look at the demographics of the Latino population expected to be the majority in America. If you look at all these numbers, look at the African American culture which has passed the world culture in the terms of entertainment and music entertainment, sports, apparel, gadgets, brands; if you build a product for consumers and for only one demographic and you’re not talking to individuals who are diverse, you are actually not doing your investors or your company a favor. You’re actually screwing them over. And then there are reports from companies like McKinsey and Company and some other companies about how diversity is good for business. Some groups provide high returns. Yes, there will be more successful companies outside Silicon Valley and the Bay Area. Tech companies will be doing well in five to ten years and won’t have to rely on VC or Angel funding from this area. But, because there are so many entrepreneurs here, there’s so much talent here, there’s so much money here, and there’s so many risk takers here, it’s still going to be the innovative capitol of the world.”

“So,” I ask Wayne the final question of our conversation, “what does success look like for you and your organization?”

In 10 years diversity will be the norm

Well for the work we’re doing and where we are, there’s going to be an immeasurable number of people for us to touch,” Wayne explained. “They’re either going to have a successful company, or they are going to be influencers themselves, and help people open doors and create successful companies, get people to raise money, become mentors and give back. So the industry is going to be way more diverse in tech. There are going to be way more successful entrepreneurs who are women, African American, LGBT, and Latino. There’s going to be more capitol and entrepreneurs. We’re going to get to the point where we stop asking why diversity matters. Ten years from now we won’t have to say, ‘give me examples of what’s working.’ Ten years from now, those examples are going to be leading the charge and the people doing the work now, and everyone else will be trying to catch up.”

Back down on the street-level, people were wearing winter parkas, some with caps or beanies, some with scarves. Many were tourists waiting for a trolley ride, but many more were the people of San Francisco, shopping, taking a break from work, or meeting a friend. The city is reminiscent of New York that it’s also a melting pot. There is rich diversity in the daytime/commuter population, but as Wayne was expressing, and as the data is telling, the city itself is becoming much more of a monoculture, partly driven by higher costs of living.

Could there be another Silicon Valley elsewhere in the states? Will the future of diversity in tech be distributed rather than concentrated? Can culture shift enough to make the foundational changes needed for the tech industry to better reflect the true demographics of the US? These are the questions Wayne Sutton is working on full-time.

Jason Moriber is a creative communicator with a background in social and digital for CSR, tech and start-ups. He’s working within the Communications team at Verizon, charged with developing a new model for corporate and brand communications. Connect with him on Twitter @jasonmoriber or on Instagram @designinginnovation