How Gaingels Gets Access to Great Deals by Promoting LGBT+ Leadership

MS: What value do you provide to companies you invest in?

LT: Besides the recruiting and networking aspects, we often help spur conversations internally that might not have been happening before. This month during Pride, I’ve met with the teams from 12 different portfolio companies to talk about the importance of DEI (diversity, quality, and inclusion) in business and venture.

Sometimes just having our name on the cap table is impactful. A company we invested in recently announced the funding round to their employees, and many of them thanked the CEO for including us in the round. To them, it meant their work to help the company succeed would benefit investors from diverse communities, which they recognized as their own communities. It meant a lot to them to see their own values aligned with those of the stakeholders in their work.

MS: How does Gaingels support the LGBT+ startup/venture ecosystem?

LT: So often the diversity conversation in venture has revolved around binary gender and ethnicity at the expense of other forms of underrepresentation and diversity. We focus on diversity in leadership broadly in venture—but with the very explicit inclusion of LGBT+ and gender-expression. This is reflected in the way we support diverse teams and help others become more inclusive.

MS: How much progress do you think the venture community has made in recent years around diversity, equity, and inclusion?

LT: Things can obviously always be better, but the positive outlook is that this is now an issue the entire venture community is taking seriously.

It’s a difficult systemic challenge we all face: there are more women in VC partnerships than in the past, but their percentage is still far below that of their male counterparts. BIPOC partners are also underrepresented, as are LGBT+ individuals. More funds exist that focus on underrepresented founders. But there's so much more that can be done in addressing more inclusive representation, from all groups, at all levels of leadership. I think our growth is a sign that things continue to move in the right direction. In 2018 our members invested $5M. This year they’re projected to invest over $300M.

There’s a newfound interest in promoting DEI, but people are often uncertain of what they can and should do to have real impact. We’ve built a reputation of supporting companies that embrace LGBT+ leadership. Because of this, our founders tell other founders about us, and co-investors embrace us. In turn, we see more access to deals from teams that want to bring about diversity. It’s a virtuous circle.

MS: What does a future look like where the companies in Gaingels’ portfolio realize their potential?

LT: As a society, we need to get to the point where most people no longer say venture has a diversity problem. If our portfolio companies grow up to be successful, it’ll go a long way towards elevating opportunities for leaders who are diverse and inclusive. That will feed into our shared understanding of whether we do have true diversity.

If change needs to be enabled from the top, the venture ecosystem ought to enable more diverse players to enter the pipeline and get to the top. That’s why support of diverse founders and inclusion and access for diverse investors is so important.

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To learn more about Gaingels, visit their website.