July 23, 2018
Kathryn Finney is the founder and Managing Director of digitalundivided (DID), a social enterprise that helps Black and Latina women own work, using innovation and technology as a tool.
You founded digitalundivided (DID) in 2013 to empower women of color through innovation and entrepreneurship. What led you to create digitalundivided? Was there a moment when your vision became crystallized?
I created digitalundivided because there was a huge community of startups, with amazing market potential and the ability to return a significant amount of capital, that was being overlooked because of the race and gender of their CEOs.
In the early 2000s, I built my first company (an online media company focused on fashion and lifestyle, which I later sold). It was while building my company that I attended an early tech incubator in New York. There I found myself to be just one of three women in a group of 40+ folks, and the only other person of color. This was in New York City, a city that is close to 50% people of color.
I grew up in Minnesota, so I was used to being “one of a few,” but as a lifelong overachiever, what I wasn’t used to was people having no expectations of me. None whatsoever. Few people talked to me and I was treated as if I were invisible. While I was the only person of color, I had to really push in order to be seen and acknowledged in the room. And when I finally got to pitch, a male investor told me that my idea was good but that he “doesn’t do black women stuff.” Another told me he didn’t think I could relate to other black women because I had an accountant (and apparently Black women don’t have accountants).
My experience wasn’t unique. It was something that many other women of color experience as well. Thus the birth of digitalundivided.
Can you tell us about the first Project Diane report that you released and the waves it made in the tech world?
ProjectDiane 2016 sparked a nationwide dialogue about inclusive entrepreneurship and innovation. Anecdotally, women founders knew that the tech space and venture capital in general wasn’t a welcoming space for women, but prior to ProjectDiane there was little empirical data to support these observations.
ProjectDiane 2016 found that there were only 12 Black women led startups that had raised over $1 million in outside venture funding. There were only 88 startups led by Black women in the US, with an average raise of $36,000. The average raised by mostly male, white founders of failed startups is $1.3 million (CBInsights).
To date, ProjectDiane has received over 1,100 features/references, 1 Billion impressions including feature length articles in Fast Company, CNN, Wall Street Journal, Inc Magazine, Forbes, Essence, and other top publications which influenced and/or led to the creation of over 30 programs, events, and symposiums.
DID released a new Project Diane report in June of 2018, which showed that significant progress has been made for Black and Latina entrepreneurs compared to two years ago. What changed, and why?
ProjectDiane 2016 quantified the problem with empirical data and, if you truly care about inclusion and diversity, this data was hard to ignore. As a result, investors started to seek out startups led by Black women and then these women started to get the press attention they so rightfully deserve.
There’s been a 500% increase in the amount of investment raised by Black women led startups since 2016 and the number of Black women led startups raising at least $1 million in venture investment rose to 34 (and counting).
Worth noting is how our research found that it was only in 2017 that investment in Black women-led startups breached the $100MM mark ($245MM, a 500% increase from the previous year). Capital, coupled with mentoring and network, is the holy trifecta of stimulating inclusive business growth, so it is imperative that our industry, which is highly innovation-driven, create even more pipelines.
What needs to happen in order to enable women of color to succeed in the tech ecosystem?
There need to be more pipelines into the innovation economy. Support organizations like digitalundivided who are creating pathways for women of color entrepreneurs through mentoring programs and networking opportunities. Join crowdfunding initiatives for WOC-led businesses. If you’re a seasoned entrepreneur, share your time and expertise as a mentor to these amazing women.
We also need to lure WOC entrepreneurs away from the big, expensive cities like New York and San Francisco, and into the neighboring tech hubs like Newark and Sacramento. The latter offers lower costs of living AND business operations (crucial to early-stage businesses) and at the same time, serves as home to major research institutions, diverse populations, and cultural experiences that can help add value to a startup’s success.
Lastly, the tech industry must let go of its penchant for pursuing “patterns” (the well-worn “next Mark Zuckerberg” hoodie-wearing, Ivy Leaguer bro), and focus on the person instead. Does the founder have resilience? Coachability? Willingness to pivot when things aren’t working out as originally planned? At DID, we found that these traits are more closely correlated to startup success.
When you’re not busy running DID, what do you like to do in your spare time?
I spend as much time as I possibly can with my husband and son. Nothing beats going home to my boys. I also swim and am working towards my lifeguarding license.