Last week, I wrote about early-stage startups investing in diversity and inclusion, but much of the progress I'm seeing in the startup ecosystem with regard to belonging and equity is happening a bit further down the journey. For many growth-stage startups, where scaling valuations tend to precede scaling recruiting operations and HR functions, building inclusive workforces is becoming every bit as essential as driving customer growth.
Just a couple years ago when Amber Madison and Liz Kofman-Burns founded Peoplism, an end-to-end diversity, equity and inclusion consulting firm, they didn't immediately know which types of companies would be most receptive to their emphasis on sustainable, long-term work rather than one-off trainings. Recently, they've come to realize growth-stage startups are ripe with opportunities to build more equitable workplaces. Their experiences both before and after George Floyd's death have given them a rare perspective on what conditions must be present for these fast-growing startups to build diverse and inclusive cultures.
Executive buy-in is essential, but D&I is a team effort.
While many companies view diversity, equity and inclusion as a nice-to-have attribute restricted to the human resources function or led by an unpaid volunteer committee, Everlaw has made DEI a critical component of the company's roadmap.
Everlaw began working with Peoplism in Fall 2019, formulating their year one roadmap right before the company's Series C raise. In the year-plus since announcing their $62 million Series C round co-led by CapitalG and Menlo Ventures in March 2020, Everlaw has grown to over 300 employees from under 200 employees.
"Our philosophy is rooted in driving outcomes with intentional processes, and it became apparent very quickly that the processes that we needed to examine lived across all of our people practices: how we attract, hire, and nurture talent," said Everlaw's Senior Director of People Operations Renita Sandosham. "We wanted to bring together the functional leaders who would formulate strategy while maintaining a close operational line of sight."
Executive buy-in not only increases the opportunity for D&I work to be strategic and meaningful within the company, but also ensures the adequate resource allocation and accountability to sustain long-term measurement and success.
"D&I strategy should be owned at the executive level, like any other critical business function," notes Peoplism's Kofman-Burns. "And you need people who are tasked with actually implementing the strategy and being accountable to its results, not an unpaid volunteer committee," .
Commonly, ERGs and affinity groups or underrepresented folks are tapped to spearhead a company's D&I work, but burnout is common given the emotional labor these volunteers are assigned simply by being among the most invested in the work. Executives must be mindful of assigning full-time, paid work hours to create more equitable dynamics to the oft-laborious process of creating cultures with belonging.
2. There's no silver bullet. Invest in a strategy instead.
"There's no way a single, one-hour training is going to make a difference," said Madison. "And there's no technology solution for magically attracting a diverse workforce, and definitely not one to keep one."
Nurx, a health startup specializing in birth control and home testing, took on the diversity, equity inclusion and belonging assessment and roadmap in a serious way when a lot of their peers weren't interested in doing a comprehensive strategy. Nurx raised a $32 million Series C in August 2019 co-led by Kleiner Perkins and Union Square Ventures, and it was after attending a webinar co-hosted by Union Square Ventures and Peoplism that Lori Medeiros, Nurx's VP of People, reached out to Peoplism with the desire to embark on a more comprehensive and strategic approach to their D&I work.
Nurx has taken on D&I initiatives across talent acquisition, performance management, and culture, and they report on progress to the entire company quarterly. One of the biggest pain points of D&I leaders, be they full-time leaders inside companies or consultants like Peoplism, is the constant pushback they must exercise against the search for silver bullet solutions.
"It's very common for executives and HR leaders to think that setting up a volunteer committee, doing unconscious bias training, or searching for the perfect recruiting software will fix things," Madison added. "Unfortunately, they quickly learn it does not, and many companies choose to stop investing in D&I rather than building a real strategy with substantive actions."
By avoiding the common pitfall of searching for a single solution to complex culture dynamics, executives and startups can assign long-term and ongoing value to the work of creating diverse, equitable and inclusive cultures. Much like finance or marketing, there is no "mission accomplished" so much as a progression of actions and strategies that can yield meaningful results for the business and culture over time.
3. Strategy needs goals, meaningful ones.
"Having a comprehensive strategy requires clear goals and a roadmap," said Kofman-Burns. "It's not just throwing spaghetti at the wall. It's about asking, 'does each initiative we're working on help drive a clearly defined goal forward?'"
Even with executive buy-in, accountability and a strategy in place, things can go awry without clear goals and benchmarks to pursue. Often times, people in startups aren't accustomed to setting goals around D&I in the way they do around user growth or revenue or customer retention, Madison noted. With any strategy, it's critical that goals are laid out and people feel like they're both meaningful and achievable. This will prevent burnout and also keep the team aligned around why they're doing the work.
"We wanted to work closely with a DEI consultant who could advise on a sustainable framework for approaching DEI holistically over the long-term," added Everlaw's Sandosham. "It was also important to us to find a partner who was eager to understand our culture and support us by both encouraging and challenging us."
"Our DEI roadmap goals became embedded in our OKRs and tactical plans, and the people teams were accountable for progress. Each quarter our CEO AJ reports on roadmap progress in an All Hands meeting to the entire company," concluded Sandosham.
The events of 2020 that instigated many startups to seek solutions around diversity, equity and inclusion over the last year-plus were numerous and demanded action. In considering the three best practices of fast-growing startups like Everlaw and Nurx, it is clear startup leaders have access to the tools they need to build more inclusive cultures. The real question is - beyond the virtue signaling - will startups have the will, commitment and strategic mindset to use them?