The journey of a startup from idea to reality has proved to be long and tiresome for all entrepreneurs. Somewhere during this journey, founders have to raise funds for their brain baby to be kicked off the ground. In the case of an LGBTQ founder, this crucial step is not as simple as it can be for a heterosexual/straight founder.
The LGBTQ+ community worldwide has a great impact on the economic wellbeing of society. Founders from the LGBTQ+ community are striving in all sectors despite the barriers society puts up for them during their startup journey. Some prominent faces in business from the LGBTQ community include Chris Hughes (one of the 4 co-founders of Facebook), Tim Cook (CEO of Apple), Leanne Pittsford (Founder & CEO of Lesbians Who Tech), Peter Thiel (co-founder of PayPal). Even after these success stories, an LGBTQ founder faces problems of diversity and prejudice.
According to Backstage Capital, a Los Angeles-based Venture Capital that invests in startups led by women, people of color and LGBTQ+, less than 10% of total VC funding goes in the favor of an LGBTQ person. This number is calculated on the assumption that all founders are open about their sexuality. However, this is not the case in reality, as many founders choose not to come out to investors to avoid any hassles down the road.
We want to bring to your notice a few interesting success stories we have come across.
Scott Lawallen (Co-founder of Grindr)
Scott founded Grindr in 2009, a location-based social networking app for gay, bi and curious men. Grindr has passed 7 million users and is currently available in 190+ countries. According to Crunchbase, Grindr has raised a total of $93 million in a private equity funding round in January 2016.
Dr Vivienne Ming (Co-founder of Socos)
Vivienne is an entrepreneur and theoretical neuroscientist. She was named one of the Top 10 Women to Watch in Tech in 2013 by Inc Magazine. She came out as a trans woman in 2005 to her fiancé. Furthermore, she co-founded Socos Labs in 2011, a platform that combines machine learning and cognitive neuroscience to bring out maximum potential from students. Today, she sits as a Co-Vice Chair of StandOut, a non-profit organization aimed at increasing the impact of LGBTQ founders.
Peter Arvai (Co-founder of Prezi)
Peter was the first openly gay CEO in Hungary. He came out as a gay man in 2015. Peter founded Prezi in 2008, an interactive presentation cloud-based platform that enables users to connect with their audience. Prezi has raised a total of $72.8 million over 4 rounds of funding. Its investors include Hearcore Capital, Accel, Bootstrapped labs & Spectrum Equity. Peter is an active advocate for LGBTQ inclusions at the workplace. He made the OUTstanding LGBTQ+ role models list. In 2013, Peter and the team at Prezi co-founded WeAreOpen with the vision of promoting and helping organizations understand the benefits of openness at a workplace.
Arlan Hamilton (Founder and Managing Partner at Backstage Capital):
Alarn is the only queer woman of colour to launch a venture capital firm. Backstage Capital is a Los Angeles based Micro VC firm that invests in startups led by underrepresented founders. It was built on the issue of lack of diversity in the tech industry. Arlan was pitching Backstage to investors while being homeless and secured her first round of funding in September 2015. Share received her first cheque of $25,000 from San Francisco-based angel investor Susan Kimberlin who strongly believes in the importance of the problem Backstage is aiming to solve.
Stephanie Lampkin (Founder of Blendoor)
Stephanie is an engineering graduate from Stanford University and an MIT MBA. In 2015, she founded Blendoor, a recruiting and analytics software for enterprises. The software sources candidates and sends profiles to the organization without the candidates’ name photo and age. This ensures the elimination of any unconscious bias on the basis of age, gender, LGBTQ or race. According to CrunchBase, Blendoor has raised a total of $165K over 6 funding rounds.
Damian Pelliccione (Co-founder & CEO at Revry)
Damian co-founded Revry in 2014, a global LGBTQ first streaming platform. The platform streams movies, TV shows, feature films, news, music, podcasts with content that reflects the LGBTQ community. Revry has raised an undisclosed amount over 3 rounds of funding. Investors of Revry include Loud Capital. Damian was listed as Business Insiders “Top 16 Power Player Execs in AD Video Streaming Space”
For LGBTQ founders to raise funds, it might be good to take one look at the following-
StartOut
StartOut is a non-profit organization/accelerator founded in 2009 by Joe DiPasquale, Lorenzo Thione, Bryan Janeczko & Darren Spedale. StartOut aims to increase the number, impact & diversity of LGBTQ+ entrepreneurs. It aims to boost their stories and push the empowerment of the community. It strives to provide equal access to LGBTQ+ entrepreneurs to key resources needed for the development of a startup.
LOUD Capital, Pride Fund 1
Loud capital invests in startups that have a positive impact on the community. This Ohio based venture capital launched the Pride Fund, a $10 million dollar investment vehicle to invest in early stage startups lead by LGBTQ entrepreneurs and also startups that uplift the community.
Backstage Capital
Backstage Capital, a Los Angeles-based venture capital fund that invests in underrepresented entrepreneurs. Arlana Hamilton, Managing partner of Backstage Capital strives to decrease this discrimination. Since 2015, Backstage Capital has invested in 160+ startups and opened doors for multiple entrepreneurs.
Unconventional Ventures
Unconventional Ventures is a Copenhagen-based venture capital that invests in pre-seed and seed-stage startups lead by unconventional entrepreneurs. It is striving to unlock the potential of underrepresented founders.
There is a wide range of startups and entrepreneurs from the LGBTQ community. If investors refine their screening process and make it free of any conscious or unconscious bias, then they can be exposed to a whole new range of opportunities.