John Roussel On Purpose Led Venture Funding To Reduce The Racial Wealth Gap
John Roussel is a co-founder and Executive Director of Colorwave.
Prior to Colorwave, John served as a Director at Strategic Education Inc. focused on their HBCU initiatives to accelerate online learning across HBCU campuses. He has held numerous positions across the education sector including as a National Director of Student Data Services and Senior Charter School Finance Specialist at EdOps, an Education Pioneers Fellow with the New York City Department of Education, and a Teach for America corps member in Atlanta, Georgia. John earned an MBA from Howard University and a BA in Mass Communications from the University of California at Berkeley. A Southern California native, John currently resides in Oakland, California with his wife and son.
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John discusses How Colorwave is addressing the racial wealth gap by providing entrepreneurs with venture funding and why business is becoming a key mechanism for inspiring sustainable social change.
Highlights from the interview (listen to the podcast for full details)
[Indio Myles] - To start off, could you please share a bit about your background and what led to your work as a social entrepreneur?
[John Roussel] - Prior to Colorwave, I spent about 12 years in a variety of roles aimed at helping close America's achievement gap and level the education playing field for traditionally underserved communities. I've done Teach for America, a fellowship with Education Pioneers and a variety of different roles helping to expand educational opportunities for underserved communities. The genesis for starting Colorwave was in the summer of 2020, where I was at a pivotal moment in my career. I had been doing impactful work, but I thought there was more that could be done. [This was] particularly in broadening access to opportunities for underserved communities in the tech space. That August, I reached out to a close friend and mentor of mine who's also on our board at Colorwave (his name is Leandrew Robinson), and discovered there were a collection of entrepreneurs, investors and non-profit leaders who were interested in broadening access to job opportunities, capital, and the venture backed start-up space. I connected with this group, and that Summer I heard what they were trying to do. They were in need of somebody to take the mission forward, and that turned out to be Colorwave. For me, what was particularly alluring about this opportunity is as a native of California, I have seen several tech booms. I grew up in the era of Netscape, eBay, Amazon, Google, Facebook; all of these companies that have now transformed the world.
THEY ALSO CREATED TRANSFORMATIONAL WEALTH FOR THE PEOPLE WHO STARTED AND WORKED FOR THEM, BUT THERE WAS A DISCONNECT FOR UNDERREPRESENTED COMMUNITIES TO GAIN ACCESS TO THOSE COMPANIES EARLY ON IN THEIR GROWTH.
That is essentially what propelled us to start this initiative. Our hypothesis is that if we can introduce these communities to those types of organisations early on, we can increase the opportunity for these communities who have traditionally been locked out of the space.
As Co-founder and Executive Director of Colorwave, can you please share a bit more about how it works, its purpose and the impact it's generating?
Colorwave is a national non-profit. we're focused on helping close the racial wealth gap by connecting traditionally underrepresented professionals to opportunities across the venture backed ecosystem. There are two key ways/programming we focus on to make this happen. The first is a fellowship program. In January of 2021, we piloted a fellowship program for working professionals of colour. We essentially tried to help them understand how modern technology companies are funded, what it's like to work and lead a venture backed start-up company, and then how to set yourself up for open roles at a company or access capital if you're building a new company. From this program, we have had about 300 alumni in just under two years, and they have been in 60 different cities. Because of the pandemic, it accelerated our growth in terms of geography and allowed us to provide a curriculum and resources to help people navigate this space better.
One of the things we do with this program that is particularly impactful is we have a speaker series, where we bring in national leaders in the sector so people can see individuals that look like themselves, who are making an impact in the tech ecosystem, or the innovation economy as we call it. We've had Michael Seibel, who is a managing director of Y Combinator, Lo Toney who runs a venture fund and is a frequent contributor on CNBC, Sharice Torres, who was a former board member of ours but also a senior marketing executive in the tech world, and then Tom Chavez, a serial entrepreneur who sold two businesses to Microsoft and Salesforce come and speak. We try to reinforce there is a place for diverse people in this space and help people navigate and understand where they fit within this landscape. That's our fellowship program. On the other end of the spectrum, we're also launching an entrepreneur accelerator for early stage founders of tech companies who are also alumni of our program. Last year, we piloted a program with about five entrepreneurs who had previously done our fellowship program to connect them with mentors for their ideas, as well as introduce opportunities to pitch for capital. Through that program, two of the founders who participated were able to receive funding. These are the ways we're trying to help people navigate from an entrepreneur perspective, but also from joining early stage companies as an employee.
In the United States, which communities are typically underrepresented and what opportunities are they deprived of?
In America, particularly if you look at the tech ecosystem, the communities where you see underrepresentation in the workforce and as entrepreneurs tends to be amongst Black and Latinx indigenous communities, so those who are indigenous to America. Then there are certain Asian ethnicities which are also underrepresented as workers within the tech economy.
JUST FROM A PURE NUMBER STANDPOINT, TWO OF THE PRIMARY TARGETS OF OUR FELLOWSHIP, BLACK AND LATINX WORKERS, COMPRISE 31% OF THE US WORKFORCE, YET THEY ARE JUST 12% OF THE TECH WORKFORCE.
There's this huge gap between what they represent in the broader economy and where they're at in terms of representation in the tech ecosystem. Those numbers dwindle as you move up the career ladder. From an executive standpoint, only 7% of all tech leadership roles and 5% of start-up executive roles are held by somebody who is Black or Latinx. We see there's this huge disparity in terms of representation for those communities in this space, and that's essentially the communities we target with our work, those that don't have equitable representation. Whether it be at a large tech company or in our case, a start-up company, we're looking to get those people connected to growing organisations and understand the career and economic upside that exists by working in a high growth business. That is the role we play and those are the communities we target with the work we do in America.
How can purpose led organisations act as a driving force to reduce inequality, and why should entrepreneurs in the future embrace these models more?
We're in an era where, contextually, businesses hold more social influence and responsibility than they have in the past 50 years. I think there's a rise in the sentiment of businesses can do well and do good in society. Some of that is a by-product of the ills that previous business practices have caused, whether it be climate change, economic and wealth inequality or gender disparities. There's a general sense across America as well as across the world that businesses can have a moral compass and do what's right, but also make money. We try to align ourselves, whether it be to venture funds or whether it be start-ups or large tech companies, which share the mission of doing well in business and also doing good in society.
WE THINK THAT ORGANISATIONS SHOULD BE THINKING ABOUT HOW THEIR PRODUCT, SERVICES AND TOOLS SERVE VARIOUS CONSTITUENTS IN SOCIETY, INCLUDING THOSE WHO ARE LESS FORTUNATE UP TO THOSE WHO ARE MORE AFFLUENT.
From our particular work as an organisation, we focus on companies and partnering with organisations that believe in providing fair wages and benefits to employees and those that are looking to implement sustainable business practices through a DI lens, so thinking about how their products and tools are received and impact different communities. We also think more broadly that companies which think about how their products and services impact all communities will have stronger business results, which will help to reduce some of the inequalities that we see in society.
What is one key piece of advice you would give to a change led individual who is seeking to start their own social enterprise.
I have a few quick pieces of advice for people who are thinking about starting change led or social impact organisations. One of the biggest things that we've done early on that is important for somebody that's starting this type of organisation is to really make sure you understand and thoroughly research the problem you're trying to solve and have some level of proximate connection to the problem that you're trying to solve with your organisation. For us, we treated the start of our organisation in the same way you may start a for-profit start-up, where we understood what was missing in the marketplace, what was the niche or problem we could solve, and what was the strategy of how we would enter the marketplace and provide something differentiated for those who needed this type of support. I would say doing your research, understanding the problem and the solution is very critical to having early success. The other thing we see now we're in the thick of implementing our model and growing is having the ability to be clear about what key performance indicators you have and then how you measure that.
FOR US AS AN ORGANISATION, WE LOOK AT A FEW DIFFERENT KPIS. WE LOOK AT THE CONNECTIONS WE'RE MAKING FOR INDIVIDUALS TO THE ECOSYSTEM, WHETHER THAT BE AS EMPLOYEES LOOKING FOR JOBS OR CONNECTIONS TO CAPITAL.
We also look at key outcomes. If we connected you to a job, what was the outcome? Were you able to transition to a new role, which is very critical to us, and once you transitioned, did you have any meaningful change to your economic mobility? Did your salary change? Did you get ownership in a company which you may not have had prior to coming to our program? Being able to track and understand your KPIs is very important. Then, I would think the last thing, particularly as a social purpose led organisation that wants to be enduring, is to have a level of resilience and persistence with what you're doing. In the same way that you may think of a start-up being very hard, being a start-up non-profit is very difficult. There are ebbs and flows or peaks and valleys that happen in this space where you have a huge accomplishment one day and then a few weeks later a challenge that you have to overcome. Being able to be resilient and staying the course is critical to keeping your mission always at the forefront of what you're doing. It's something that's very important, particularly if you're an early stage social purpose led organisation.
What inspiring projects or initiatives have you come across recently which are creating a positive social change?
In our particular space, we're at the intersection of venture investors and start-ups who want to do good and broaden access for communities that have traditionally been locked out of this sector. There are a few different models that are currently taking shape and which we are really excited about. One is a venture fund we work with, which is called Concrete Rose Capital. They have a model where they invest in growing businesses transforming society, but as a part of their model, they've also developed a foundation where a portion of the carry they receive from their investments goes to also support organisations, non-profit organisations, social mission organisations that are also increasing access for communities in this ecosystem. We are a part of their foundation community, but we also enjoy working with all the other partners that are a part of that mission. Similarly, another organisation that has done this type of work, Andreessen Horowitz recently started the Cultural Leadership Fund. This is a fund where they invite black partners to join in terms of their Limited Partner base. They include people of colour, and then donate a hundred percent of the carry and management fees to non-profit organisations that are advancing the mission of getting more black people into technology careers as employees, founders, and investors. Those are the models that we are hopeful will serve as a pillar for the future and ones that we're encouraged by how they're set up and what they have the potential to show the world of how you can do this right. Those are a few that we are really excited about, both as participants in the work that they do, but also in the future outcomes we think they're going to do to broaden access to this sector for traditionally underserved communities.
To finish off, what books or resources would you recommend for our audience to check out?
IF YOU ARE LOOKING TO BETTER UNDERSTAND THE RACIAL WEALTH GAP, PARTICULARLY IN AMERICA AND WHY IT EXISTS, I LIKE TO LOOK AT STUDIES THAT SHOW HISTORICALLY HOW SOME PROBLEMS HAVE PERSISTED HOW THEY PRESENT THEMSELVES IN SOCIETY.
I like to look at Brookings Institute reports around the racial wealth gap. Particularly, they did a study in 2020 that examined the black and white wealth gap, which was very illuminating on how this problem existed and how it may be exacerbated over time, but also how it can potentially be solved. Another group that does some dynamic research is the McKinsey Institute for Black Economic Mobility. They've done a lot of studies about how focusing on integrating diverse businesses into the stream of commerce will improve economic outcomes for the economy as a whole, which we think is very important. In terms of tech specifically, the Kapor Center, which is based out of Oakland do annual studies around the state of black and Latinx people in the tech ecosystem, and those reports really give a full picture of what the representation looks like as well as what are some of the longer term levers that can be pulled to broaden access at the educational level, but also within the workforce development sector. Those are a few resources we continually monitor and look at to evaluate what we can implement, or certain data points that help evaluate the progress we're making within this sector.
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