Guest Blog by Lunar Startups
Black, Indigenous, people of color, women, and LGBTQ+ founders have always had to do more with less.
It comes as no surprise that founders with these identities face unfair and significant obstacles when going to market, scaling, and competing in the marketplace. Yet, consumers with purchasing power are getting younger and more racially diverse every year, creating a huge market opportunity for startup founders who deeply understand this under-served group.
But strategies to address these well-known disparities often recreate the same problems they were intended to solve. Accelerator programs—one of the best tools we have to increase a startup’s survival rate—are limited in solutions provided, in ambition rewarded, and even more limited in regards to the founders who participate. The experiences, requirements, and recruitment networks are exclusive and therefore benefit only a small percentage of innovators. New research demonstrated that accelerator programs actually made funding gaps worse between men and women founders.
And that’s before the new reality of COVID-19 and America’s ongoing social revolution redefined work, family, and social norms in profound and still-evolving ways.
We can’t go back to the old way of building businesses.
It’s time to support the bright solutions and big ideas of entrepreneurs who have gone unheard for too long.
Here’s one way to start – throw out the accelerator playbook.
Two years ago, we launched Lunar Startups in St. Paul, Minnesota to re-imagine and re-design the accelerator experience for Black, Indigenous, people of color, women, and LGBT founders. Here’s what we learned, and strategies you can implement to make your accelerator program, non-profit, or investment portfolio inclusive of more people and more ideas.
Our accelerator program starts with a 63-question business assessment for all founders. We analyze the results and executive intensive one-on-one sessions which we use to co-create custom experiences and individual milestones for each company.
Investing in customization is worth it. While some of our cohort companies started out as service businesses and are productizing components of their work, others are building apps or SaaS solutions. Some are creating companies in line with traditional venture-backed startups, and others are successfully bootstrapping their way to profitability. We believe that all of these models have the potential for big scale and big success, and that a one-size-fits-all approach would close the door for the diverse companies that we work hard to attract. Indeed, our cohort companies have increased their revenue growth by 194% while participating in our customized programming.
Feedback, feedback, feedback.
We ask our founders for input, a LOT. The core data capture takes place pre-program, mid-term, and post-program. We gather qualitative and quantitative data, and capture survey feedback from founders after workshops, after meetings with investors, and after each event. We also distribute surveys to experts, mentors, and external stakeholders.
Gathering that data is critical to keep us accountable to our mission to create growth, connection, and innovation for our startup companies. For example, founders in our first and second cohorts reported that only 40% of workshops were conducive to group learning. So we canceled most workshops and moved those topics to one-on-one coaching sessions for the next cohort experience.
Become a customer.
When it comes to supporting entrepreneurs, it’s not enough to just talk the talk. You also need to walk the walk. For us, supporting the awesome diversity of our Minneapolis-St. Paul community starts with our program participants and continues with our vendors. We publicize our vendor demographic targets, share our spreadsheet of vendors who represent diverse backgrounds, and ask entrepreneurs in our community for recommendations. Accountability matters!
Build intentional support systems.
When the tragedies and difficulties of COVID-19 began to grow, we were all overwhelmed. Founders and small business owners are especially vulnerable given thin margins, finite cash flow, and limited resources. Founders with employees feel the pinch even further.
After quickly moving programming and coaching sessions to virtual platforms, we rallied to support our founders. We started with three questions: “How are you today? What is worrying you? What opportunities are you finding?” That was the entire agenda for our first video conference call, and we still hold these wellness webinars weekly. We also teamed up with local women-owned business The Coven to offer digital strategy sessions for founders to work through challenges in the community, over Zoom. Founders tell us these offerings are critical to their confidence in finding a way through.
When George Floyd was killed in Minneapolis, our founders were affected in deep and complex ways. While no single accelerator program can fix systematic racism, our pre-existing support systems meant that our founders didn’t have to show up for “business as usual.” We were able to grieve together and support each other.
Success doesn’t have to look like hustling 24/7. We’re working to shift the stereotype that an entrepreneur looks like one type of human. (Close your eyes. You can probably picture his hoodie.) From the very beginning, we were intentional about creating spaces where founders can bring their whole selves to the table—no fronting.
Successful problem solvers can look radically different across our community. In the uncertainty—and possibility—of this moment, now is the time to embrace more people and more ideas in the startup space.
Lunar Startups will open applications for Cohort 4 in late Fall, 2020. For more information, contact email@example.com.
Lunar Startups recently published Tools for Inclusion, two open-source reports including methodologies, techniques, and strategies for building more inclusive startup ecosystems, plus the nitty-gritty details about building Lunar from the ground up. Download the Tools for Inclusion for free on Lunar’s website.
Cover Photo Credit: Youth Lens 360