Initiative for a Competitive Inner City (ICIC), a nonprofit based in Dudley Square, Roxbury, recently released a report highlighting a lack of diversity among incubators and accelerators, calling for action.
For the report, “Creating Inclusive High-Tech Incubators and Accelerators: Strategies to Increase Participation Rates of Women and Minority Entrepreneurs”, ICIC partnered with JP Morgan Chase. They interviewed more than 75 industry experts to understand diversity dynamics within incubators and accelerators throughout the country, in addition to coming up with solutions to increase inclusiveness of women and minorities among these programs.
The report cites that among all businesses throughout the country, women own 20 percent of them, while minorities own 18 percent. Zeroing in on data about demographics specifically among incubators and accelerators proved more challenging. However, ICIC conducted a survey of eight programs in the U.S. and found that an average of 20 percent of the ventures within these incubators and accelerators were owned by women, meanwhile 23 percent were owned by minorities. (The percentages in individual programs ranged from six to 42 percent for women-owned firms, and from 14 to 39 percent for minority-owned firms.)
“Increasing participation of women and minorities in high-tech incubators and accelerators is definitely feasible.”
“Increasing participation of women and minorities in high-tech incubators and accelerators is definitely feasible, and we have identified several effective strategies that are already being used by some leading organizations,” Kimberly Zeuli, ICIC’s Director of Research and lead author of the report, said in a statement.
So how are incubators and accelerators supposed to become more diverse? While one school of thought is to create separate programs solely dedicated to all-female or all-minority founded startups, ICIC suggests a different approach. The report offered several recommendations to lower the barriers of entry at all-encompassing incubators and accelerators for women- and minority-owned ventures.
Essentially, ICIC’s rationale is that these programs are typically dedicated to particular industries. If they were focused on demographics of founders rather than verticals, it could undermine their collaborative, constructive environments.
Instead, ICIC pointed to four main tactics incubators and accelerators could take to attract and drive participation among female and minority entrepreneurs:
- Expand recruitment networks through diverse leaders and partners
- Create diverse selection committees and adjust the selection process
- Intentionally design programs for women and minority entrepreneurs
- And create an inclusive culture
ICIC elaborated that its research found that programs that had diverse management were more likely to have diverse entrepreneurs. Additionally, the nonprofit suggested incubators and accelerators look externally, partnering with organizations that serve women and minority startup founders. With both of these instances, programs would have a more diverse network from which they can recruit, while also attracting more female and minority entrepreneurs by having successful role models and connections to which they can relate.
Programs could also benefit from adjusting their criteria, application and selection process. If they build out more diverse selection committees, ICIC maintains they’ll be able to recruit more qualified entrepreneurs from all backgrounds. The nonprofit advised that having more flexible scheduling, child care support, appropriate curricula and tailored resources could all impact programs’ ability to drive participation among women and minorities, including those serving as EIRs and mentors. ICIC referenced a local incubator:
For example, Fairmount Innovation Lab (FI-Lab) is an incubator and accelerator that was launched in 2015 in the Uphams Corner Dorchester neighborhood of Boston as part of a place-making initiative. FI-Lab draws on the cultural assets in the Fairmount Corridor to catalyze the launch and development of creative enterprises in the area. It offers a customized curriculum and workshop offerings, professional expertise and services, including assistance with access to capital and co-working. FI-Lab had deliberately adjusted its programming and curriculum in order to serve the entrepreneurs in the local community and has a diverse representation of entrepreneurs (approximately 89 percent are women-owned or led and 90 percent are minority-owned or led).
Lastly, ICIC’s research found that creating a well-rounded culture in these spaces plays a role in diversity. The report shared that apparent “bro culture,” an air of exclusivity and an emphasis on workaholic and shark-like values could all be deter certain demographics of entrepreneurs.
“People are drawn to spaces and opportunities where they feel comfortable, where there are other people similar to themselves, and where they feel they might fit in,” the report read.