By Chris Davidson, Head of StartOut Growth Lab
As a leader StartOut Growth Lab:A 6-month startup accelerator that offers high-quality mentorship, education, and networking opportunities for young companies founded or co-founded by LGBTQ+ entrepreneurs, I found that LGBTQ+ business owners face two major obstacles in building and sustaining. successful company. access and representation.
1. Entrance.
LGBTQ+ founders do not have access to resources such as talent, startup capital, growth capital, and skill development that non-LGBTQ+ people do. Access to these valuable resources is usually based on a person’s personal network and ecosystem, and I find that our networks and ecosystems may not be as broad as some of our allies due to our upbringing or the communities in which we find ourselves.
I see many entrepreneurs who don’t have the ability to borrow money from friends, family, or banks to get the money to either start a company or let it grow quickly. Additionally, once a company is up and running, I have witnessed LGBTQ+ founders not being able to attract or pay for the best human capital resources to compete with other non-LGBTQ+ based businesses. At times, this factor may put us at a competitive disadvantage in our business.
2. Representation.
A few key aspects of being a successful business owner are having a good business plan for success, having the right plan to build that plan, and being able to limit your mistakes. Just as it is important for LGBTQ+ people to have representation in the media, it is also a great advantage to see this representation in the business arena.
I find that business owners who have business role models or a company and founder to learn from and generate ideas from are more likely to succeed. They also have more opportunities to more effectively navigate the planning and implementation stages of a business. Unfortunately, most business owners cannot find a role model or business mentor who is like them to learn from.
Strategies to overcome these challenges
These are some of the challenges that LGBTQ+ business owners face, but what are some strategies or resources that can help them overcome these challenges? The most successful people I’ve worked with have overcome these challenges by 1. Finding a mentor/role model, 2. Deliberately expanding their ecosystem, and 3. Relying on their resourcefulness.
1. Find a mentor.
The single best piece of business advice I ever received was in 2000 from John Havens, a successful business friend of my father’s, who said, “To be successful, you have to figure out what no do, and it will show you the right way through the process of elimination.”
Learning from someone else’s mistakes, or as I like to say, “using someone else’s learning curve,” can structurally change one’s company. I can’t tell you how many times I’ve seen companies with great mentors avoid catastrophic mistakes because they have someone to bounce ideas off of. And more specifically, being able to bounce ideas off of someone who has done what you’re trying to do is a huge factor in one’s success.
StartOut is an amazing resource for finding a business mentor. Additionally, most major metropolitan areas have a National Gay and Lesbian Chamber of Commerce, which also serves as an epic resource.
2. Lean into resourcefulness.
Another important strategy that successful LGBTQ+ business owners implement is to use their unique ability to be resourceful. Growing up LGBTQ+ allows many members of the community to be resourceful and creative.
When I remind the founder that they’ve been through much more difficult situations in their lives than the challenges they’ve faced with their business, a little light goes on in their heads. I can even see it in their faces. Then I will ask the business owner. “I can see the change in your face and the way you look. Where did you go in your head?’ Nine times out of 10 I hear something. “Oh, I’ve been through much harder times, thanks for this reminder… I can figure it out!”
3. Intentional ecosystem expansion.
A final strategy I’ve seen for LGBTQ+ business owners is to intentionally expand the ecosystem. Essentially, growing an ecosystem is simply networking and building your network. However, there is a difference. most people think of networking as a random process that happens naturally. The truth of the matter is that networking, and good networking, requires intention and process to get the most out of it.
The easiest way to get started is to create what I call a “Hit List”. Create a list of 15 to 20 connections or relationships that you don’t currently have but would structurally benefit your network or business. Once you’ve created a “hit list,” you need to go to work creating strategies for how you go about creating these new relationships.
As mentioned above, being an LGBTQ+ business owner is uniquely qualified based on our resourcefulness and ability to be creative in reaching those connections, allowing your business to be more successful.
Final thoughts
An LGBTQ+ business person is uniquely qualified to face the many challenges they will face in the business world. Using the resources available to them and trusting themselves to overcome these challenges will make all the difference.
Over the past six years of StartOut Growth Lab’s existence, 65 companies have graduated from the startup accelerator, raising $763 million in funding and creating more than 3,650 jobs. When we work together to overcome the obstacles our community faces, virtually anything is possible.
Chris Davidson has a 25+ year career investing in and advising companies ranging from investment banking, real estate private equity and development, hedge fund, commodity fund to venture capital. He is part of the LGBTQ+ community and is an advisory board member and head of StarOut Growth Lab, an incubator for LGBTQ+ entrepreneurs.