Nonprofits StartOut and Socos Labs have launched the StartOut Pride Economic Impact Index (SPEII) to quantify the economic value of under-utilised “out” LGBTQ+ entrepreneurs. The “industry-first” initiative quantifies the economic value of under-utilised LGBTQ+ entrepreneurs who will be integral in re-energising the US economy, quantifying the potential for job creation and innovation post-COVID 19.
According to the creators, SPEII’s goal is to quantify the unrealised potential of “out” high-growth LGBTQ+ entrepreneurs, for the benefit of the US economy at large. The initiative reveals that over the last 20 years, for example, more inclusive access to resources would have created over 2 million jobs in the US.
Although the integration of underserved entrepreneurs, including the LGBTQ+ community, has progressed over the last few years, their access to critical resources is still far from equal, note StartOut and Socos Labs. This is due in part to the” lack of reliable data on the contributions of LGBTQ+ entrepreneurs who create jobs, raise capital and innovate and the impact they could have had with equal access”. SPEII fills that gap at a time when the US needs all talent available to kickstart the economy following the COVID-19 pandemic, add the creators.
HIGH-GROWTH LGBTQ+ ENTREPRENEURS
According to StartOut and Socos Labs, only about one in 10 high-growth LGBTQ+ entrepreneurs who would have been expected to close $1M+ in funding actually raised it, illustrating a major opportunity for investors. Metro comparisons reveal big discrepancies in leveraging the economic potential of high-growth LGBTQ+ entrepreneurs. While San Francisco benefited from over 15,000 jobs, the numbers in Boston and Chicago were a tiny fraction of that. LGBTQ+ entrepreneurs raised $5 billion in funding. San Francisco, a traditional hub for both entrepreneurship and LGBTQ+ culture, accounted for $3.9 billion of that funding. The creators therefore believe that funding LGBTQ+ entrepreneurs in the rest of the country presents major growth and investment opportunity.
Municipalities, investors, ecosystem builders and grant providers can use the new SPEII to improve environments for founders of diverse backgrounds and reap the corresponding benefits. The platform can identify approximately 86,000 high-growth entrepreneurs who typically raised $1M or more in funding, as well as compare actual and potential economic output of “out” LGBTQ+ entrepreneurs with their peers.
The “industry-first” initiative is funded by JPMorgan Chase as part of its $150 million Small Business Forward philanthropic initiative to invest in underserved entrepreneurs. The project is also supported by Ogilvy, Google, Crunchbase, Reaching Out and the Movement Advancement Project.
TIMELY INITIATIVE
“The launch of SPEII, two years in the making, could not be more timely. Each entrepreneur who has what it takes to drive the recovery of the US economy must get a fair chance to contribute,” stated Andres Wydler, StartOut’s Executive Director. “We are immensely proud to offer, with our partners, an actionable tool for decision makers nationwide who recognise the need to include and leverage all entrepreneurial talent that is able and willing to rise to the occasion.”
The initiative utilises “big data analysis and a corresponding AI-driven engine to both measure contributions in close to real time, and calculate what they could be with equal access, thus quantifying the unused potential for job creation and innovation by LGBTQ+ entrepreneurs”, add the creators. “The easy-to-use platform visualises growth opportunities by metro areas in terms of jobs, patents, fundraising and company exits.”
According to Dr Vivienne Ming, Founder of Socos Labs, “Our big-data driven, close to real-time approach takes the guesswork out of decision making for interventions. Over time, we can evaluate trends and differences with the data at hand and will gain deep insights into which programmes and regulations impact opportunities for underrepresented communities, positively and negatively.”
MARGINALISATION-FREE ENVIRONMENT
Adding to her comments, Ted Archer, Head of Small Business Forward at JPMorgan Chase, stated: “Now more than ever, it is critical to create an environment free of marginalisation where all have a chance to share in the economic opportunity that business ownership can provide. SPEII and its near real-time data will enable decision-makers to make data-driven investments that support the broader entrepreneurial ecosystem as we recover and rebuild from the COVID-19 crisis. We are proud to support StartOut in this groundbreaking endeavour that helps put into focus the contributions of the LGBTQ+ community.”
As diversity and inclusion is increasingly recognised as a driver for innovation, business success and ultimately shareholder returns, SPEII allows business leaders and investors to increase impact by integrating LGBTQ+ talent across industries, nationwide. SPEII is available for free. Click here for more information.
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