- Mandela Schumacher-Hodge Dixon succeeded in Silicon Valley despite not knowing anything about the tech industry before she moved to the area — and despite being a biracial woman.
- But Dixon recognizes she was lucky; entrepreneurs who are women or people of color have struggled to gain a footing in the valley.
- Hoping to use the lessons she’s learned and pass them on, Dixon’s founded a new startup that offers training courses designed for non-traditional entrepreneurs like herself.
When Mandela Schumacher-Hodge Dixon launched her first startup, DemoLesson, seven years ago, you likely wouldn’t have given her much of a chance of succeeding in the tech industry.
At the time, didn’t live in the Bay Area, didn’t know anyone in the industry, and knew little about how to fundraise or how Silicon Valley worked. She’s wasn’t a coder or an engineer; instead, she had been a middle-school teacher and working on a PhD — in education. What’s more, she’s a biracial woman with an African-American dad and launched up her company at a time when there were few women or people of color founding startups.
“My experience in this space was really isolated,” she said. She continued: “I didn’t know what i was doing most of the time.”
But Dixon succeeded even so. During an event sponsored by , she connected with other founders and investors. That helped her secure venture funding for her company, a kind of LinkedIn for teachers, from famed tech investor Mitch Kapor.
When her startup didn’t pan out, the connections she’d made led to a job at Startup Weekend helping organize events for entrepreneurs in the education technology space. After Startup Weekend transferred her program to another organization, Dixon eventually went to work for Kapor’s Kapor Capital, helping mentor other startup founders funded by the venture firm.
And now she’s got a new startup, this time focusing on helping other women and people of color succeed in the industry. Dubbed Founder Gym, the new organization offers a four-week training course for entrepreneurs from underrepresented groups that are intended to give them the knowledge and connections they’ll need.
Dixon’s experiences in the industry have given her a view of it and insights into it that many women and people of color don’t have, she said. Her decision to start Founder Gym was also fueled by being the child of civil rights attorneys and her experience as a former teacher.
“I’ve navigated spaces and been in rooms with people most people never have access to,” Dixon said. “I actually feel like it’s my duty to share this information that I’m getting and spread forth this message.”
Founder Gym’s program is structured like an online course
Given Dixon’s background, it may be no surprise that Founder Gym’s program, which costs $400, is structured like a class, albeit an online one. Students have a curriculum and weekly coursework. The program features weekly video presentations from professional investors. And students collaborate with each other and critique each other’s work.
After launching Founder Gym in November, Dixon trained her first group of 26 founders early this year. A second group of 44 entrepreneurs recently completed the program, and a third group of about 50 will start soon.
The entrepreneurs come from a variety of backgrounds. Some had already raised venture funding. Others hadn’t. Many live outside Silicon Valley. All are either women or representatives of groups that are underrepresented in tech.
Dixon has tapped people in her network including Kapor, Ellen Pao, and Charles Hudson, who is one of the few African-American venture partners, to serve as visiting lecturers and mentors. She intentionally brought in people who were comfortable, willing, and able to have frank discussions with the founders about issues of race and gender — the kinds of conversations they couldn’t have elsewhere.
“When you go to Y-Combinator’s startup school, those things aren’t being addressed,” Dixon said, referring to one of Silicon Valley’s most well-known incubators for new tech firms.
The program helps connect founders with others like them
But for many students, the best part of the program is being able to meet and share experiences with other founders who come from similar backgrounds.
“When you’re building your startup, it’s a pretty lonely experience at times,” said Sunny Washington, a Korean-American woman who was a member of the first Founder Gym group.
“The reality is that if you are a person of color or female, you don’t fit in this cookie-cutter mode. Your experience could be different,” added Washington, whose three-year-old startup, Because Learning, sells software and hardware kits to schools that are designed to interest kids in science, technology, and math.
Founder Gym’s initial sessions have all focused on fundraising so far. That’s on purpose, Dixon said, because having sufficient funding is crucial to a startup’s success. And how to play the venture funding game is a skill that many founders, particularly those who aren’t from Silicon Valley or don’t have a background in the industry, just don’t have.
“There’s no precedent for teaching underrepresented founders how to fundraise,” Dixon said. “We are literally creating the textbook for this.”
She plans to eventually offer a whole curriculum for founders that includes a range of topics. Those will be inspired both by the questions entrepreneurs raise, but also by the topics investors affiliated with the program think founders need to be familiar with, she said.
“We have both sides of the equation,” she said. She continued: “We’re bridge-building between these two worlds that don’t really know each other.”
The tech industry has a big diversity problem
Dixon’s identified a real problem in the tech industry. Even though the Bay Area — Ground Zero for the industry — has a liberal bent, women and people of color, particularly Latinos and African-Americans, have long been underrepresented at tech companies. Despite public pressure in recent years from the Rev. Jesse Jackson and the #MeToo movement, the situation hasn’t gotten a whole lot better, as the diversity reports from companies including Apple and Google can attest.
But the problem is particularly acute among tech startups. Only 17% of venture-backed startup firms launched last year had at least one female founder, according to PitchBook. Just 1% of startups had an African-American founder in 2010, the last year CB Insights made such data public.
And the lack of diversity is a self-reinforcing problem, say critics inside and outside the industry and researchers who have studied the issue. Much of venture capital investing stems from what they call pattern matching.
VCs often base their investment decisions on the pictures they have in their minds of what successful entrepreneurs look like, researchers and critics say. More often than not, that archetypal startup founder is white and male and has a degree from — or at least attended — a prestigious university such as Stanford or Harvard. That’s largely due to the fact venture partners are overwhelmingly white and male and attended those kinds of schools — and because the startups they’ve funded in the past were founded by people just like them, researchers say.
For founders who are women or people of color, “it’s harder to raise money,” said Fern Mandelbaum, a lecturer at Stanford’s Graduate School of Business and a partner at Vista Venture Partners. “We know it still is.”
The venture funding process is stuck in a “feedback loop”
Because white male founders get a disproportionate amount of venture funding, a greater number of them are likely to be successful. Those entrepreneurs are then often targeted by venture capital firms looking for new partners. Once they fill those positions, the cycle repeats itself in a kind of “feedback loop,” said Y-Vonne Hutchinson, the founder and CEO of ReadySet, a consulting firm that helps other organization improve their diversity.
“This is how power, money, wealth, and opportunity gets concentrated in the hands of the few and excludes the many,” she said.
That’s obviously bad for women and people of color. But it’s not good for the tech industry. Researchers have shown that companies with more diverse teams tend to perform better than those without them. Companies with leaders that come from a variety of backgrounds can recognize trends and customers bases that more monolithic firms might miss.
Thanks in part to the #MeToo movement, in Silicon Valley there’s starting to be “a recognition that diversity is going to translate into better outcomes,” said Dana Kanze, a doctoral fellow at Columbia Business School who has focused on gender discrimination issues in the tech industry.
Non-traditional tech founders have few role models
The flip side of the funding problem is women and people of color have relatively few role models or examples they can point to for how people like them can succeed in tech. Many may not realize that becoming a tech entrepreneur is a possibility as a career.
Those who do generally have few people like themselves who can guide them on how to navigate the industry. And because they often don’t know anyone else who has gone through the process of building a tech startup, many just don’t have the knowledge they need to succeed, whether that’s about how to pitch a venture capitalist or even just how to get a meeting with one.
That’s the part of the diversity problem that Dixon designed Founder Gym to address.
“There are all sorts of ways in which gaps get created in knowledge and preparation” between the traditional white male entrepreneurs and those who are women or people of color, said Kapor. “What Mandela is doing is, in an intensive way, helping close some of those gaps.”
Dixon is hoping to pass on what she’s learned about the industry
Dixon knows first-hand about some of those knowledge gaps and lack of preparation. While she successfully launched and attracted funding for her startup, she says she was lucky.
She had no idea how to pitch a venture firm, but she gave her presentation to Kapor and his wife, who have placed a premium on diversity and made a point of backing founders who come from underrepresented groups. They overlooked the fact that she gave a non-traditional presentation and decided to back her startup anyway. Once they were on board, she was able to lure other investors.
“I just stumbled into it,” she said. She continued: “I’m not sure I would have been been welcomed in this industry if I hadn’t gone through that door.”
Unfortunately, there are lots more founders who are women or people of color than the Kapor’s small firm can back. So, not everyone can be as fortunate as Dixon was; other investors typically aren’t as receptive to pitches that veer from the standard script. Dixon’s trying to make sure other entrepreneurs are better prepared than she was — and hoping to help them succeed.
“We need case studies” for what a successful woman- or minority-run startup looks like, she said. “I understand my privilege and the doors that have been opened for me.
“I want to throw a rope down and help other people climb up.”
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