How Startups Can Build Inclusive Teams from Day One
Have you ever tried to write a company-wide email for the fourth time in one month to address racial violence? And you know, the email itself isn’t enough. It isn’t action, it isn’t a consolation, it doesn’t make your startup a better place to work. So how do you show up for your employees in a way that is more than lip service, and that helps make a difference?
When it comes to the challenges founders face in building inclusive teams from day one, the issues are deep. In fact, it starts with your board of directors. In the latest Startup Board of Directors Benchmark Report published by Bolster, the talent marketplace for executives from diverse backgrounds, its findings are troubling: boards of early-stage startups up to Series A have boards that are 62% homogeneous. Or another way of saying that is: all white. Your board may look like an endless parade of the same person with different colored Patagonia vests, or Allbirds, depending. When your board of directors and leadership team lack diversity, employees from diverse backgrounds ask themselves not only, “Will I fit in here?” but, “How will I ever get promoted or grow in a company that doesn’t prioritize hiring people of color?”
The stakes are high. Tech workers are looking to their founders; Human Resources and Diversity, Equity, and Inclusion (DEI) teams; and startup leaders to go beyond making diversity statements for their websites and social media accounts “because they have to.” In fact, 83% of millennials feel more engaged at work and more actively participate across teams in environments that they feel are inclusive, and where their voice is heard. Startup founders who hold themselves and their companies accountable to creating inclusive workplaces are set up to make a lasting impact.
According to Patty Alverenga, the Lead Strategist at one of the top DEI consultancy firms and research labs, The Collective, startups in particular can really help to address at least some of these issues right away:
“With a startup, you have that unique opportunity to build equitable hiring processes from the beginning, so you’re set up to succeed.”
Launching a startup and building it from the ground up is no easy task. There’s often a lack of established processes in the early days of a startup, fundamentals like insurance for startups are missing, and standard procedures aren’t in place, especially when it comes to hiring new team members. While startups can rely heavily on referrals from team members in their growth stage, the danger here is that you never look beyond your bubble, and you can inadvertently contribute to bias in your hiring.
Kelly Wulff, General Counsel at Vouch, cautions: “I think one of the most important things that I would encourage all companies to do is really make sure that hiring people from diverse backgrounds is a focused effort. I think it's really easy, especially with a company that's growing quickly, to have these priorities take a back seat, and that’s not acceptable.”
Alverenga adds that, “Having an actual standardized process that you apply across all teams and across all levels will help create guardrails.” She elaborated, “Even if bias wants to pop in, you have guardrails there to alleviate that.”
Another important way to assure that your teams are more inclusive and diverse is to codify those things into your company values. Diverse teams are consistently found to be more creative, more innovative, and more productive as well. A recent McKinney study showed that “companies in the top quartile for racial and ethnic diversity are 35% more likely to have financial returns above their respective national industry medians.” This is because diverse teams mean diverse perspectives, which can help create cutting-edge solutions to problems. Eighty-one percent of American employees also prefer to work in companies with people from different cultures and backgrounds according to a study by Randstad.
An inclusive set of company values can also be a great guiding force that helps to create cohesiveness within a team…if used correctly. “A lot of the times,” Alverenga cautions, “we have these set values or set things that we say we care about, but what does that actually look like when put into practice?”
Or better yet: do you have company values that your team members will even remember, and are worth remembering? Alverenga insists on the importance of actually living the values set down by your company in everything that you do, particularly when it comes to diversity and inclusion and setting up ways that assure that both employees and the company are held accountable to those values. Alverenga says,
“How do you actually live the values within your processes? How do you incorporate them, and ensure that folks are being held accountable?”
The inclusivity of your team is another thing to consider. As previously mentioned, just because you have a diverse team, doesn’t mean they all feel seen, heard, or included in your company or its culture. That’s why it’s so important to put processes in place to assure this.
“One of the most important things a company can do,” Wulff suggests “is create a really easy-to-use transparent feedback loop, [in order] to give employees an opportunity at all stages of their employment journey to be really direct and candid about their experience and their needs and things they'd like to see changed.”
It’s also critical to make sure that the diversity in your team is distributed throughout your company, including in the upper management and C-suite level. Collecting demographic data that also records where employees work and how they’ve moved through the company can help you notice a problem ahead of time. For instance, a company may have a strong balance of male to female employees, but on second glance find that there is a lack of female employees in upper-level positions. Companies like The Collective and other DEI startups can help startups to collect this kind of data and put it to good use.
This kind of information can help companies identify where the gaps are in terms of assuring that all employees have equal access to opportunity and mobility within the company. The accountability you set up in the beginning also helps here, in that it should set a clear map for what to do when and if these kinds of discrepancies come up. These kinds of accountability processes vary widely, and DEI professionals agree that each company should make their initiatives company-specific, but some ideas of where to start include:
● Encouraging ongoing dialogue by measuring participation in DEI initiatives.
● Creating systems that track and share progress on DEI goals.
● Including DEI goals in performance reviews and evaluations for bonuses and promotions.
While it’s never too late for an organization to begin prioritizing diversity and inclusion in their company, by committing to a diverse culture from the get-go, your team will have an immediate advantage. Taking the time to set up processes and procedures that help ensure a diverse workforce that can thrive is key to launching a startup that is not only profitable, but also has a positive impact on the world at large.