Seven enterprise capital organizations and startups focused on diversity in the technology industry announced Data Diversity Alliancea commitment to standardize the way data is collected and shared.
Data transparency stays a pressing issue in the enterprise for those looking to higher track where money is being allocated and to whom. Many corporations already privately compile basic information about their founders, but this data might be distorted if released publicly without visibility into how the data was collected.
The alliance hopes to simplify this process by creating a framework that corporations can use to collect information about founders and funders. It also hopes to take steps toward creating a centralized data pool to higher track and understand financing trends in the industry. This is especially essential for marginalized founders who still receive little or no funding.
The alliance told TechCrunch it hopes to look at this data to find ways that might help increase capital allocation to underrepresented founders, with the intention of publishing a report containing centralized data. It is developing privacy and security measures, in addition to raising funds for a database where this information might be stored.
Organizations that have joined the Diversity Data Alliance so far include All Raise, Diversity VC, BLCK VC, StartOut, 2Gether-International, Vets in Tech and Somos VC, though more may join. The group began working on the standardization process last fall and began implementing it this spring.
“We were all trying to do this on a small scale and with extremely limited resources,” said Sarah Millar, chief operating officer of Diversity VC and founding father of the Diversity Data Alliance. “By combining our data collection and analysis efforts on this particular piece, we can devote more time to programming and projects that clearly move the needle for our communities.”
A typical data collection process will be certain that all corporations use the same optional contact form for all founders. This means asking the same five questions about basic information resembling the founder’s name, preferred pronouns, email address, location and LinkedIn link. Companies may also ask the same questions about race, asking founders to check what they discover as and asking them to select their date of birth. He will ask the founder what gender he identifies with, sexual orientation, education, degree of disability and military affiliation.
So far, corporations have been asking similar but completely different questions. For example, some corporations didn’t ask questions about disability status, race, and gender, and some used more specific language about race or gender than others, resembling asking whether the founder was from the Middle East.
The Diversity Data Alliance is the latest effort in an effort to bring greater data transparency. Next 12 months, California is set to implement a law requiring corporations operating in the state to report the demographic breakdown of the founders in which they invest, a move aimed at higher understanding the wealthy and have-nots of the funding world. The alliance said it is in contact with lawmakers working on the California bill and hopes to share lessons learned as each measures are implemented.
The alliance hopes that other corporations and organizations will join the data collective.
“We can’t change what we don’t measure,” Paige Hendrix Buckner, CEO of All Raise, told TechCrunch. “By uniformly collecting demographic data, we can gain a deeper understanding of the venture and startup ecosystem landscape, which will ultimately lead to greater transparency and more effective storytelling about the characteristics of thriving venture capitalists and rising stars in our industry.”