LGBTQ+ People Have Faced…
discrimination, adversity, and extra hurdles to success in many areas of society, including wealth accumulation, access to education, hostile work and social environments, and more. Additionally, as intersectionality influences the experiences of all people, LGBTQ+ individuals with various intersectional identities of race, gender, class, etc. often experience harsher forms of exclusion.
According to a 2020 report from the Center for LGBTQ Economic Advancement & Research, gay men made 32% less than heterosexual men, on average, and lesbians earned 11% less than heterosexual women, on average. The scarce data that does exist on the economic conditions of LGBTQ+ citizens demonstrates that LGBTQ+ people are more likely to struggle in society’s modern economy than non-LGBTQ+ people. Efforts to reduce these major societal inequalities would concretely contribute to the increased prosperity of the United States, and global economy at large. Thus, it is in society’s best interest to work to eliminate the magnitude of opportunity gaps between the privileged and various groups of marginalized people in society, such as the LGBTQ+ community.
Entrepreneurship exists as an important mechanism for wealth accumulation, yet serves as an example of one of the many opportunities that marginalized groups face barriers to accessing. Starting and growing a business necessitates investment capital, which reinforces the purpose of and advantages that venture capital funds can provide for entrepreneurs. However, the fierce competition to secure funding frequently prevents countless founders from advancing their ideas. For minority founders, specifically LGBTQ+ founders, this competition is often compounded by explicit and implicit biases that favor cisgender, white, male founders over founders with different intersectional identities.
Backstage Capital, a venture capital fund that seeks to improve the conditions for minority groups in the VC space by investing in women, people of color, and LGBTQ+ founders, estimates that less than 1% of the $1.5 trillion invested in global VC deals from 2010 to 2019 went to LGBTQ+ founders. In addition, a 2016 study by StartOut, a nonprofit organization serving and providing mentorship for LGBTQ+ entrepreneurs, revealed that about 40% of LGBTQ+ entrepreneurs said they chose not to self-identify as LGBTQ+, often because they were concerned doing so might harm their chances of receiving capital. When founders have to exert mental capacity worrying about the effects of their identity on receiving funding, the disadvantages that LBGTQ+ entrepreneurs face go beyond physical and tangible metrics of financial success and trickle into affecting the mental health of these founders.
Pre-seed investment is arguably the most crucial step in determining whether an idea will actually take off, and can be even more difficult for LGBTQ+ founders to secure when LGBTQ+ founders lack the network base that non-LGBTQ+ founders possess, due to bigotry or exclusion from unaccepting families and friends.
Discerning this vast inequity that LGBTQ+ founders experience in the entrepreneurship space, I have made it my mission to create more opportunity and equality for LGBTQ+ entrepreneurs. I understand first hand the challenges of building a successful startup as an under-represented LGBTQ+ founder, and play an active role in the LGBTQ+ startup community holding board positions with StartOut - the leading LGBTQ+ global founder network and The Pinnacle Foundation - which awards university scholarships to LGBTQ+ students.
This past fall, I launched Chasing Rainbows, an angel fund that invests in pre-seed companies led by underrepresented LGBTQ+ founders that exhibit determination, grit, and resilience. My goal is to level the funding playing field for these underrepresented founders who often do not have access to vital funding networks. My vast LGBTQ+ community network and visibility as a successful entrepreneur and mentor means that I am often the first point of contact for LGBTQ+ founders seeking funding and advice. I intend to leverage my network to position Chasing Rainbows as the premier pre-seed investment fund for LGBTQ+ founders. Recent investments range from Tomtex, a sustainability company that has created a faux leather material from mushrooms and coffee grounds, and has recently closed a $1.7M raise, to SoundMind, a mental health focused app that helps people who suffer with PTSD regain control of their lives through academic-led music therapy, and is currently closing a $1M round.
Overall, increasing access to investment capital for LGBTQ+ founders functions as arguably the most objective measure to increase equality and opportunity for LGBTQ+ entrepreneurs. Chasing Rainbows is excited to contribute to more equitable entrepreneurship opportunities for LGBTQ+ founders, who can create more jobs and inclusive workplaces, boost the economy, and feel empowered to contribute to modern innovation.
(“The LGBTQ Wealth Gap” 2020)
(Kashner and De Leon 2022)
(Cianci 2021)
(Macan 2021)