@tbwabackslash

class="content__text" This week, California passed a bill that will require venture capital firms to annually report the diversity of the founders they are backing. The law is the United States’ first piece of legislation that aims to increase diversity within the VC landscape. And given California accounts for nearly 50% of the world’s venture capital, it will have far-reaching impacts. Once the law goes into effect on March 1, 2025, any venture capital firm operating in the state (as well as firms that either invest in California companies or raise money from California investors) must report the race of the people they back, as well as their disability status and whether they’re a member of the LGBTQ+ community. The bill also requires firms to share their diversity data with the public. Funding to startups led by women, Black founders, or Latinx founders has never risen more than 5% in any given year—a grim statistic that could change as a result of this new law. California’s landmark move also comes in the wake of the Supreme Court's recent decision to strike down Affirmative Action programs in college admissions, raising concerns about equal opportunities for underrepresented groups.  With the VC industry under fire for its lack of diversity, this new law is a critical step toward fostering a more equitable startup ecosystem. And it may be the start of a much larger transparency movement. According to Allison Byers, a tech policy advocate who helped ideate the bill, they are “already in discussions with leaders in other states and countries who are interested in enacting similar policies.” Edge: Inclusive By Design . . . . . . . . . . . . . #InclusiveByDesignBackslash #VC #venturecapital #californialaw #diversefounders #startupfunding #celebratediversity #femalefounders #blackowned #inclusivity #dei #diverseleadership #diversityintech #diversitymatters

October 17, 2023