Building a business from scratch is not for the faint of heart. The seed phase is the most crucial phase for startups, because this is when the business idea proves its market viability. But proof-of-concept comes with some costs—usually in the form of infrastructure, marketing and development. Businesses in the seed phase haven’t always earned revenue, and without seed funding, they are unlikely to progress further. Entrepreneurs from marginalized populations—women, trans, and non-binary people, particularly those who are Black, Latino/a, Indigenous, or people of color—are at an even greater disadvantage.

On average, companies with teams that are all men are typically awarded 300% more funding than women and BIPOC-founded companies in the seed phase. Marginalized founders on the whole often lack the connections needed to secure seed funding, while studies show that potential investors have a skeptical bias against women and other marginalized founders when compared to founders who are men. Without vital seed funding to realize their products and ideas, many women and BIPOC-founded startups aren’t even given the opportunity to succeed.

The system does not stack odds in the favor of these marginalized groups, which ultimately means that the greater population is missing out on life-changing ideas and innovations. If we are going to address gender and racial inequities, we must build new systems—and that can’t happen without investment at the seed phase.

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