Diversity in Innovation
Level 3 - non-randomized controlled study
Level 3 by design analogy (observational longitudinal labor market study), not clinical CEBM.
OpenAlex W2582659073 · doi:10.3386/w23082
What was done
The authors documented labor market participation patterns for women and ethnic minorities (Hispanics, African Americans, and Asians) in venture capital (VC) firms and as founders of VC-backed startups from 1990 to 2016. They evaluated supply-side factors including educational attainment and prior job experience, examined state-level variation in diversity, and assessed mechanisms such as homophily-based hiring and information networks.
What was found
Between 1990 and 2016, women constituted less than 10% of the entrepreneurial and venture capital labor pool, Hispanics accounted for approximately 2%, and African Americans accounted for less than 1%. These proportions were substantially lower than each group's representation in relevant higher-education programs and other highly compensated professions. Conversely, Asians had a higher representation in VC and startups relative to their overall share in the labor force.
Why it matters
This study provides empirical baseline figures on demographic representation across 26 years of the US venture ecosystem, establishing that the underrepresentation of women, Black, and Hispanic professionals is not explained solely by differences in educational pipeline supply.
Limits
The abstract does not state the sample size (number of individuals, startups, or VC firms analyzed) or the specific data sources used. The findings are primarily descriptive and correlational, limiting causal attribution among competing drivers such as homophily, institutional bias, or specific labor market frictions.
Cited by
- supports 95% of venture capital funding has been allocated to male founders, with the majority allocated by male investors who attended Harvard or Stanford.