Finding more venture capital for minority and women-owned start-up firms could help bolster the region’s business community in many ways, says Doug Villhard, director of Olin Business School’s entrepreneurship program at Washington University in St. Louis.
According to a Bloomberg report, Black/African American and Hispanic/Latinx founders received just 2% or less of the total venture capital in 2021. Just 2% of venture capital money went to female business founders.
“This funding gap shortchanges not only underrepresented founders but also the vitality of the entire innovation community,” Villhard said.
Villhard and Wash U are partnering with the Brookings Institution, a nonprofit public policy think tank based in Washington, “to develop policy-based solutions for the historically lopsided funding support available to underrepresented minorities and women,” according to a release.
A nine-member commission that includes entrepreneurs, venture capitalists and public policy experts will oversee and guide the project while providing input and insight from the perspective of innovation practitioners.
The goal is to address questions including: What are the root causes of this inequity? What impact does this have on the economy? What solutions can address it?
“Rather than simply talk about the past, this commission intends to identify meaningful public policy solutions to drive more equitable funding, unlock more potential and further spur our economy,” Villhard said.
The project is the second backed by a $750,000 grant to Olin Business School from The Bellwether Foundation. The grant called for three separate annual commissions — formed jointly with Brookings — tackling “megatrend” issues affecting the quality of life in the region and across the country.
The first Olin Brookings Commission project concluded in April, and saw participants develop an artificial intelligence-driven tool to flag suspicious shipments of prescription opioids and developed policy recommendations designed to empower the tool’s use among federal agencies, law enforcement and industry.
In November, the commission will host a national conference of researchers presenting work focused on unearthing the root causes for disproportionate funding and informing any potential public and private policy solutions to address the yawning gap. The conference will be held at the Brookings Institution. Daniel Elfenbein, professor of organization and strategy at Olin, will serve as chair of the conference.
In addition to Villhard and Elfenbein, the project will be led by WashU faculty members Dedric Carter, Olin’s professor of practice in entrepreneurship and WashU’s vice chancellor for innovation and chief commercialization officer; and Gisele Marcus, professor of practice.
A key component of the Bellwether funding calls for student involvement. Ming Zhu Wang, a fifth-year Olin PhD student in strategy, will organize related research, along with five entrepreneurship fellows pursuing master’s in business administration degrees, who will assist with planning, research, and feedback.
Commission members include:
Christine Aylward, founder and managing partner at Magnetic Ventures
Charli Cooksey, founder and CEO of WEPOWER
Lori Coulter, co-founder and CEO of Summersalt
Morgan DeBaun, founder and CEO of Blavity and advisory board member for the Black Economic Alliance
Gaurav Garg, founding partner of Wing Venture Capital
Lisa Morales-Hellebo, co-founder and general partner at REFASHIOND Ventures
Martin Hunt, CEO of Swanlaab USA Ventures
Andre Perry, senior fellow at the Brookings Institution
Akeem Shannon, CEO and founder of Flipstik
Commission members will collect and distill data and industry input over several meetings — including the November conference — with plans to release a comprehensive report of its findings and recommendations by April 2023.