The technology industry is home to an unacceptable paradox: the sector is both the epicenter of wealth creation and wealth disparity. This gap begins in the early stages of company-building, among venture capital-backed startups and the people who found, build and invest in them. People of color have largely been left out of this ecosystem.
Changing that reality is the mission of career advancement nonprofit Management Leadership of Tomorrow (MLT), which works to put people of color in leadership positions. A major part of MLT’s work is dispelling the myth that the lack of diversity in the tech industry comes from a so-called “pipeline problem” of talented African American, Latinx and Native American science, engineering and computer science grads. In actuality, the problem is a network gap, which is why MLT and Greylock have recently launched a new partnership to accelerate change for POC in the venture and startup ecosystem. Additionally, MLT has established an impact fund to invest further growth of their programs, and the organization is also a limited partner in Greylock’s newest fund.
MLT CEO and founder John Rice and Greylock general partner David Sze sat down with Greymatter to discuss the new partnership. You can listen to the podcast here.
Elisa Schreiber: Today, we’re having a conversation about race and career mobility in the technology industry. The venture backed startup ecosystem is arguably the epicenter of wealth creation. And unfortunately, the epicenter of wealth disparity. The fact is that black, Latinx and Native American people have largely been left out as founders, early employees and funders. Changing his reality is the mission of John Rice, who is the founder of career advancement nonprofit Management Leadership of Tomorrow (also known as MLT).
John is joining us today on Greymatter, along with David Sze, my partner at Greylock. Our two organizations have launched a broad partnership in effort to accelerate the change for people of color in the venture capital and tech startup ecosystem.
Diversifying tech and venture capital is a complex undertaking, and this partnership is just a start towards the much-needed progress. But John and David already have a lot of ideas that they’re ready to talk about today.
Thanks for listening. We’re going to get into the specifics on that partnership in just a little bit, but before we dig in on that, John, I would love to start with you. Can you give us an overview of your background and really what brought you to start MLT?
John Rice: Thank you, Elisa. And David – it’s great to spend some time with you on this podcast.
Now, there are probably two versions of the journey in starting and building MLT. Number one would be that over the course of 10 years – after business school, then working at the Walt Disney company, and later as an executive of the National Basketball Association – through my own experience and of mentoring and supporting other folks of color along the way, I thought there was a real opportunity and need to build a nonprofit that would expand the pipeline of people of color growing toward leadership positions across the private and social sectors. And it actually is true that I, like many of Greylock’s startups, actually formally launched MLT out of my home in Burlingame over 15 years ago.
But the reality is the other side of the story. The reality is that I’ve been working on this idea and refining it since I was a kid growing up in Washington, D.C. watching my mother dedicate her career to passing legislation – actually the Pell grant legislation that enabled millions of low income and minority students to afford college. And I knew as a kid that I needed to dedicate my career to something that would build upon her work. And then in my own experience coming out of college and heading to business school, I made a number of mistakes, navigational mistakes, because I had no one to tell me what the bar was to get a job in a lot of the areas that folks are going into, like consulting and banking, and how to approach applying to business school. Even though my parents were highly educated, their careers were not in those areas [I was looking to work in]. My parents were largely in the public sector and they actually couldn’t give me the playbook. I was lucky enough to not get too off track, but when I got to business school and I realized that there were so few people of color there with me, experiencing what was a transformative experience for me, I realized that, you know, if I had made so many mistakes along the pipeline (just coming out of college to the workforce and going back to grad school), that there had to be so many other folks who didn’t have the opportunities that I had growing up. For people who didn’t have parents who went to college, they had to be making so many more mistakes.
And that was really the reason why there were so few folks there of color. So, taking advantage of the opportunity to meet so many amazing folks that were coming to recruit and speak at these business schools is what really started me on that path of creating a better mousetrap for helping people develop their academic and career potential.[ I wanted to help] people who feel the gaps of exposure and social capital, and help them understand the bar to meet. I wanted to help them, and then also help institutions, which are really important pathways in our society for economic and career mobility. I wanted to help them do more winning things to widen the road for people of color.
Elisa: Tell me a little bit about the state admission of MLT and give us a sense of the organization today: how big is it? How many people are there working full time?
John: At MLT, we focus on an impact across three spheres. The first one is expanding economic mobility for low to moderate income college students. We’re focusing that last mile toward economic mobility, which is definitely that college to career transition, where right now over 60% of black and Latinx four-year college graduates are not getting jobs that require a college degree.
The second sphere of our work is really focused on developing 1,000 high-impact leaders across the private and social sectors. Then, the third sphere is diversifying institutions and helping them widen the road for more access and success for people of color, because they’re important pathways – the most important pathways – in our nation for career and economic mobility.
As I mentioned, we’ve been at it for more than 15 years and we’ve had great results and gotten to a meaningful scale, although I still think we’re still scratching the surface. We’re about at the scale of a midsize university. We’re working with about 2,000 students a year (over 10,000 to date), and our programs cut across college to early career. We have a graduate level program. We have a maker set of programs. And we worked at about 130 institutions, leading companies across all key sectors of our economy. We have about 100 staff members. We’re very excited to be placing 98% of our minority college students in jobs (coming out of college) that pay an average $70k+ per year starting salary. For our folks who are Pell eligible students (people who are coming from families that earn $50k and below), that’s immediately game changing. We’re excited that 75% of the folks that go through our mid-career programs – which really focus on making the turn so you’re squarely in the path to senior management – are getting promoted within a year coming out of our programs. If you go to Harvard, Wharton, Stanford, Kellogg, or most of the top 10 business schools, about 50% of black and Hispanic MBAs at those schools are graduates of our MBA prep program.
Elisa: When I hear about all the incredible growth and impact that you’ve had to date with MLT, and then I hear people talk about a pipeline problem, it makes it really hard for me to grok how those two ideas coexist. Can you let me know how you react or respond when you hear folks talk about a pipeline problem in terms of recruitment of people of color?
John: Folks that know me well know that I’m very passionate about talking about pipeline. This has been a multi-decade mission of mine to put the pipeline narrative to rest. I’d like to talk about it because you hear very smart, highly-respected executives across all sectors talking about the pipeline of qualified minorities, and they have to walk that back. One of the problems that we have as it relates to our journey on diversity and inclusion is to help executives. I’m largely talking about white executives here, but really, everyone needs to be well-informed about the talent recruitment pipeline. The other one is actually how different the experiences of people within our organizations (if you are a person of color relative to your white peers). We are fundamentally not well informed about either of those things.
So let’s talk about, for example, the tech sector. People say we can’t move the needle in tech until we go really far back in the pipeline and address high school STEM education, or first-generation college students. And I say, “Now, time out.” To be well-informed, all you have to do is go to the National Science Foundation website and look at their data. You[‘ll see that 22% of all the BS degrees granted in 2015 for computer science, engineering, and math were granted to blacks and Hispanics. And more importantly, that number equates to 50,000 BS degrees. So if you look at the last five years, assuming 50,000 each year (and I’m sure it’s higher than that), that’s 250,000 degrees granted to African Americans and Latinx grads in those three areas. So we know the pipeline is there.
There is a similar narrative in financial services and other sectors. Is the pipeline there? Yes. Do we have to expand the pipeline? Yes. Do we need more folks at the mid levels? Yes. But there is a big enough pipeline of fantastic talent today that there is no excuse for us to be where we are as it relates to our hiring and our development of people with technical talent of color. This is true for the tech sector in particular.
So, one: that gives me optimism. But two: it speaks to the importance of reframing the problem. This is not a pipeline problem. This is actually a network gap and an information, relationship, and exposure asymmetry. That actually gives me more optimism that we can move the needle much more quickly than based on what you are hearing in the rhetoric that most of our senior executives continue to spread.
David Sze: I’d like to hop in and throw in another thought, having spent time with Johnny and looked at this narrative about a pipeline problem. I agree. I hear what he says. If there’s a pipeline problem, it’s not that there isn’t enough talent out there, it’s that it’s on us to figure out how to create that pipeline for that talent to get it into the right places; into the right networks. That’s what the pipeline problem is. When someone CEO of a major financial organization says there is a pipeline problem, it’s on them. They should be looking at themselves because they’re the pipeline problem. It isn’t on the supply side. It’s on the demand side. It’s about creating the systems to allow those networks to build.
John: Dave, when you’ve heard that, how many times has the person who said it followed up that statement with a quantitative assessment of that pipeline? I’ve never heard it once. So I love to hear it actually isn’t there.
If we’re going to move the needle, if we’re going to make advancements around racial equity gaps in this important moment in our country’s history, we’ve got to be grounded in the contours of the problem. We have to understand why we are where we are. We have to be well-informed. You would never get away with not being well-informed about the impact of AI on your investments and on your portfolio. In thinking about the future of innovation, financial services executives would never say, “I don’t really need to know anything about Bitcoin, because that’s an emerging thing for now and I can just leave that to somebody else.” But they are [essentially taking that perspective] when it comes to these issues of talent, of understanding the contours of the talent pipeline, the emerging issues of diverse talent experience and how it’s different. We need to call on folks to be well- informed.
You want some statistics? You’ve brought these to my attention and they’re just stunning to me – the impact of not being well-informed. We have a situation where we have black college graduates with a medium net worth 18% of that of white college grads in the United States, and $30,000 less than white non-college grads. Those are the kinds of statistics that are the real problems and that should be highlighted.
Elisa: Once a person of color has joined a company, what are some of the things that the companies need to consider, in terms of making sure that they’re able to retain the talent and to ensure that they’re successful in the role?
John: You’re hitting on two elements. We talked about being well-informed and having a comprehensive approach. If you’re going to expand the leadership pipeline, there are two levers: the lever on the way into the recruiting pipeline and the lever on how you’re advancing talent that you have. We talked about the recruiting piece and the talent pipeline, but there’s something else that we’re missing that’s critically important. It relates to how we as people of color experience organizations very differently than our white peers, even when we went to the same schools and whether we went to colleges or prep schools, or have similar backgrounds. As we go from meeting to meeting, when we are the one (or one of the few) people of color, the questions toiling around in our head are, “Do I measure up? How am I being perceived if I make a mistake? Does it reflect on not just me, but the other people of color? Why are there so few people of color in the organization?” And in some instances, “Am I being treated differently?”
Actually, the answers to the questions are not really important. In many cases you’re not being treated differently, but if you perceive that you are, it’s distracting. And you can imagine how those two things within the context of the tech sector in the entrepreneurial ecosystem are deeply problematic. They are problematic in any environment. When you get constructive feedback, someone comes to you and pulls you aside and is candid enough to say, “Hey, you know, you need to work on these things.” You don’t know where that’s coming from. You don’t know if that person has a position of trying to build you up or take the next level, or cut you off. When someone is actually reaching out to provide some advice and mentoring and you’re not sure of their position, you’re much more hesitant relative to your ability to trust that person.
In the world of employment in America, we all know the importance of mentoring and sponsorship. But when you are dealing with the issues that I just described, what you need is actually a base level of support (below the mentoring and sponsorship) that focuses on high accountability, having a safe place, and coaching – the kind of coaching you get in the sports world. You can imagine that you’ve probably been in this situation once yourself, where you’re in a meeting and you think you’ve got an insightful point that will advance the conversation, and you think there’s maybe a 30% chance of it actually doing so. It’s probably not a good point, but you raise your hand. You’re brave. You say, “Here’s what I think we should do.” If you’re the only woman in that room, everyone reacts sort of sideways. And then five minutes later, some guy raises his hand and says the exact same thing. And everyone says, “Yes, let’s go do that.” And then you’re asking yourself, “Hey what just happened there?” And then you have to go back to your office and ask yourself, “How do I regroup? How do I go back to my manager and get feedback?”This is the kind of thing that a mentor who meets with you once a month and once a quarter can’t be around to help you with. They don’t know you well enough. They don’t have the frequency of meetings with you to see, but this is the kind of thing that’s happening all the time. And it speaks to the importance of having sports-like coaching in addition to mentoring and sponsorship in order to move into the kinds of interventions that are really important. But in the professional world, you don’t get that kind of coaching unless you’re already a senior executive, which is especially problematic if you’re a person of color.
Elisa: You touched on a lot there. One of the points you made was specifically around the tech and startup ecosystem, and I’d like to dig in there as that’s clearly the area that this relationship with Greylock and MLT is going to focus on.
I think it’s worth unpacking a bit some of the unique and systemic issues that people of color face when they’re making a decision about whether or not to join an early stage startup when they are coming out of business school or coming out of college. Can you share a little bit about that?
John: I want to address that on two levels. The first one I could share my own experience. I’ve mentioned that I was not a first-generation college student, but my parents largely made their careers in the public government sector, and they really didn’t have the answers for me in terms of what’s the bar to get into the tech sector and how to think about opportunities. And so many other folks are in the same boat if you’re a first generation college student. You have loans and debt when you’re coming out of college, and even more so at a graduate school. When you think about the tech ecosystem – the vibrant, dynamic entrepreneurial world that is the tech venture – in a growth equity ecosystem, that’s very disconnected.
I’ll give you an example. I went to a conference maybe 10 years ago with the Black MBA Association. It was a career fair for black MBAs, and there were large companies with these big booths. Everyone’s there at those booths talking, sharing resumes, trying to set up interviews, etc. And then there was Facebook in his tiny booth, not very well positioned in the room. There were literally five people in the line, meaning no one was focused on actually pursuing careers at Facebook. They didn’t really understand it as an employer brand. Yes, many of them were already on it as users. But the point is that there’s a combination of a lack of exposure, relationships, and any symmetry – we don’t see people of color who are senior in the world of tech. We don’t see any black and Hispanic David Sze. We don’t know the folks who work for those folks, so the elder perspective is not there. There are no household names. People can recognize an emerging company in the entrepreneurial ecosystem, but without the relationships, without the role models, and without a high-touch outreach engagement model from the tech ecosystem (coming to me similar to the way the banks and consulting firms and others in major fortune 500 companies are), it just doesn’t work. People who are engineers and who are computer science undergrads and who would fashion themselves as entrepreneurs are finding other paths. It’s very addressable and it requires work on both ends. Institutions need to take a totally different approach. The ecosystem itself – leaders, then individuals – have to lower the perceived risk. You do that through relationships. You do that through exposure.
Elisa: That’s a great segue into getting into some of the meat around the partnership between MLT and Greylock. I’d like to kick it over to you, David, to just share a little bit about how this relationship got started, and then you can talk about the details of how we’re going to be working together.
David: Great, thank you, Elisa. I’ve been lucky enough to know Johnny since our college days together, and we’ve kept in touch over the years. Recently, he came to me when they were looking to expand their presence in the Valley and increase their focus on opportunities in the tech space. That was the initial seed of the idea, but recent events have really kicked things forward in our mind. We’ve been very focused on how we try to do some things that will make a difference in the ecosystem over time. Internally at Greylock, we’ve been working on a whole bunch of lists and a bunch of areas to work on, so I reached back out to Johnny and talked about how we can work together.
It’s amazing how much MLT’s work lines up with all the things that we’ve been trying to do. For example, we have a group in Greylock called Core Talent that focuses on hiring out of universities and on up through VP, primarily in design, engineering, and product, among other functions. As Johnny mentioned, his whole group and MLT is focused on how we get talent exposed to those opportunities. So we’re going to lock those teams together. They’re figuring out how they’re going to work together, what their goals and metrics are going to be, and how we’re going to get MLT’s alumni and MLT fellows into Greylock companies, and how to get those companies exposed to other companies in the Valley. We have an executive team function that does executive recruiting, and they also are connected with members. Johnny’s team is looking at the rising leader alumni network that MLT has. Over the years, it has grown to 9,000-plus people. Johnny’s team is looking at which members are relevant, and which tech companies we should be working with to help get into our startup companies and help them be much more successful by integrating and working with them. Then we’re going to help them to understand the playbook of how startups think about hiring: how they look at how the interview process, what skills they’re looking for, and how we mesh with the programs and systems that MLT has built. We’re going to provide a view from the Valley on how that works from our perspective, so we can make success happen for both of us.
Another way that Greylock wants to work with MLT is in navigating and understanding fundraising., whether that’s with a VC like Greylock, or through the accelerator and incubator environments, which have exploded over the last decade. Again, that also is a system that is completely opaque if you come from the outside. We can be very helpful and understanding by giving them a sense of the playbook. We can help them understand the bars to meet, the ways you need to think about positioning yourself, the ways you communicate, and what people are looking for. We have a lot of experience with our tech startups, and now we’re going to apply that to work with the MLT team.
Lastly, we will connect and support MLT talent interested in pursuing careers in venture capital, which is another world that is very opaque and is very unclear. The most opaque and least clear thing about it, probably, is how you get our role. This is an area where there are the least roles available, period. It’s very ad hoc and not specific in how it’s navigated. So one of our goals is to work with the MLT team to help expand our network of talent. At Greylock, we hope to have goals for ourselves in terms of bringing people of color into our team, but also exposing talents to other VCs and other funders around the Valley so they can expand their teams as well.
So, this isn’t really about Greylock, honestly. This is about MLT and about creating access and opportunity. And we’re taking a first step to help grease the wheels and create some systems to help support that. But we want everyone to be involved and we want everyone to make this successful, because it’s really about figuring out how we work to change the trajectory so that in 10 years we look back and can feel really happy about the impact that it’s had.
Elisa: I can testify to the enthusiasm of the partnership around this work that we’re doing with MLT and diversifying our LP base. Can you expand on why it is a priority for Greylock to commit time and energy to this kind of initiative, and why you picked up the phone and called Johnny, knowing he would be the right person to move this forward?
David: First of all, shame on us for not having done this earlier, period. That’s just the reality of the situation. But the other reality is that big moments of systematic change usually come about because of catalyzing events. And clearly there are large injustices that have been existing for a long while that have come to the forefront in American life and are now causing catalyzing events here. That really unique energy has gripped our country, but it’s also gripped Greylock. The team really wanted to do something meaningful and proactive. We didn’t want to just put out a corporate statement that had no teeth. We have a lot of work to do, and the partnership is committing to doing the work, and the energy is coming from every vector. From investing partners sending notes about ideas and how to work with MLT to our operating team sending notes about how excited they are about engaging and having metrics for themselves – not only about the number of folks that they place in our startups, but also now the number of MLT fellows and MLT teams members that they can place into it into the systems.
So there’s a lot of energy, and of course, and we’re not the only ones working on this issue. There’s lots of different kinds of programs going on, and we need lots of different kinds of programs. This is about having everyone doing as many things as we can to try to make a difference and lay lots of seeds and see what will grow and what will flourish. It’s fantastic that so many people have dug in to work on this, both inside Greylock and, I believe, across the industry. Now we just need to keep doing the hard work and to keep doing it together.
We feel like we’ve got a really strong orientation to build this partnership on top of it. Thanks to the hard work of my team, and MLT which is very scrappy and military, we’ve already got 1,700 people of color who are working in the tech sector. We’ve got maybe 60-plus who are in venture capital, and I think five venture firms, just within the last few years, have been founded by MLT rising leaders who have raised a combined almost $350 million. So we’ve got a starting point, and I think that’s one of the reasons why we all feel confident that we can build upon this foundation. If we just apply our respective competencies and energy to this, this ecosystem can look completely different in five years, and totally different in seven to 10 years.
Elisa: David, you mentioned that you went to college with John and that’s you know, each other. Can you tell me a little bit more about just some color around how the idea for the broader partnership came together?
David: John and I have known each other for a long time. We met in the late eighties in college, and became friends there and spent time together over the years. We’ve kept in touch through his founding of MLT and through me joining a bunch of startups and then Greylock back in 2000. you know, More recently, we both got on the board of trustees of our alma mater, so we’ve spent a lot of time together there. That long history has built up a lot of trust and understanding. I’ve always admired Johnny and what he’s done at MLT. As we were looking to figure out how to create some action and impact around our diversity and inclusion initiatives at Greylock, my relationship with Johnny allowed us to quickly reconnect and really fast-track the entire process. The trust and the deep understanding that Johnny had of Greylock and that I had of MLT made it really possible for us to do this. It allowed us to take, hopefully, some big swings together and do it in very short order.
John: Our relationship is an example of the power that folks have when they have a shared vision and are fired up to attack problems and also have a level of comfort with each other. It’s an example of the kinds of things that can take place at important moments in time. I think that that speaks to both the opportunity that we have, jointly here in the tech ecosystem, to facilitate the kinds of relationships that are important before a deal happens, or before a hire or an offer happens. We’ve got to work hard to expand networks and facilitate trusted relationships between very, very talented people of color. Very, very, very talented people have been in this ecosystem for a long time. But the ironic thing is that, for me, it was just a stroke of luck that David and I ended up in the same class in college freshman year, and spent four years essentially in the same dorm. We could just call it a residential college; we shared so many great stories in our formative years that it made it easier.
But there’s another side of this that’s worth mentioning: It took a level of trust and a long term relationship for this to happen. That is what I would call a “lightning strike,” and which isn’t scalable or repeatable. What we need to do to close this network gap in the tech sector is to facilitate a lot more of these relationships so we’re not just expecting future lightning strikes in order for us to move the needle on diversity in the ecosystem. I’ve studied this – if you go back and look at some of the black and latinx folks who’ve gotten to the CEO level in our major organizations, almost without question all of them share a story of something fortunate happening. Something happened to them that had nothing to do with their talent and that probably shouldn’t have even happened, but it was so critical to them turning the corner to be on the path to that senior executive and CEO level. For example, I remember reading a piece about Xerox’s former CEO, Ursula Burns. Ursula talked about walking down the hallway, heading towards the cafeteria or something, and some older white gentleman pulled her aside. This was when she was a mid-level engineer. And he says to her, “Hey, why don’t you come over this way and talk, because I’d really like to expose you to a broader part of our business. There are other things that we do.” And I think she initially said no, and that she was not really interested in doing that. She enjoyed being an engineer and thought she was on a good trajectory. And the gentleman said, “No, I’ve heard great things about you. You’ve got to come this way.” And she did, and everything changed from there. Something like that isn’t going to happen in a repeatable way, so we’ve got the responsibility to turn what has been lightning strike – for the very few people of color who have made it to the executive roles and who have companies and who have gotten into venture firms – and turn that into a repeatable ecosystem that looks like the kinds of very high, high leverage networks the Valley is really built upon.
David: As Johnny talks about this, it rings so much truth to what goes on in the Valley already today. If you aren’t in the collision points that so many people in Silicon Valley have access to – for example, the network of having worked at Facebook or LinkedIn, or having gone to Stanford – it can take a massive stroke of luck for someone to find and build powerful networks. In the Valley, we talk so much about social networks. We talk about network graphs. We talk about social capital and social proof as ways to increase trust and to move quickly.
But if you don’t have access and you aren’t integrated into those networks, it is a random lightning strike [you are banking on]. So instead, we need to turn it into an environment where there is so much access that we have chances for these collisions to happen all the time. We need it to be more like a large electrical storm where these kinds of things are happening right now for everyone the way they are happening for white males, primarily, in the Valley. We need to increase access to people of color so that they can be part of the networks today. You’re going to see alumni from Airbnb and Stripe and other high-growth startup companies found the next generation of startups, and you’ll see VCs eager to back those teams and recruit from them because that’s the network that’s been built. That’s how the Valley works. And it’s crucial to make sure that people of color are included in that entire flow as early employees at breakout companies, and as potential investors downstream as well.
John: That resonates so deeply with me. It reminds me of when I was in the early days of MLT. It was around 2006, 2007 0r 2008. I came across an article in the New York Times, and the title was “It Pays to Have Pals in Silicon Valley.” It talked about exactly what Dave just described. There was this chart, and Reid Hoffman (coincidentally, Dave’s partner) was on it. The chart talked about the cohesive network that emanated from PayPal to so many other organizations – whether they’re tech companies, other VC firms, or even hedge funds. I was just floored by this concept. I had that article in my briefcase, literally, for probably two years. Every time I got to talking to somebody like Dave and other Silicon Valley veterans about MLT, I would pull out that article and say “This is what we are trying to create.” I would go door to door and say, “Look, if just one of these folks on this graph was African American or Hispanic or another person of color, think how much would be different things would be in the Valley today, in terms of people of color-led startups.” Think how different it would be in terms of who is being funded by venture firms, who are investors at venture firms, executives at operating companies, even philanthropy in our most vulnerable communities – that’s the power of these networks. It goes well beyond a nea- term transaction. It’s the kind of thing that we need to recreate with people of color and that widens through the pot for everybody. I think that’s the model. What Dave described is really the model where we’re trying to go. We figured, we know what that model is, now we just need to expand it and replicate it to include people of color.
David: We’ve been lucky enough at Greylock to be involved in a bunch of social networks. And so we understand how this works and it puts an onus on us, we believe, to really engage in this and try to be part of making a difference. I think it’s also important to note that this is early and there’s a lot of hard work to do. In our industry – whether you say technology writ large, startups, or the VC industry as another sub sector – we’re all pathetically bad at this. It’s unacceptable where we are. And we’re eager to work with other VC firms and startups in the industry to help move this forward in the right way. It’s not going to be about Greylock changing the world. This has gotta be about how we as an industry work together; how we find great organizations like MLT to engage with and bring into our network and expand our networks and really change this dynamic that we’re talking about.
John: Dave, I know you’re a very humble guy, but I will say too humble in this case because you all are best in class – maybe the best in the world – as it relates to how to build and sustain networks and make them work in a very high leverage way across your ecosystem. That’s the kind of expertise that will be really important to move the needle and help us figure out how to recreate these networks for people of color.
I know we are early stages in this relationship, and I know you like to say that you all have a lot of work to do, and we all have a lot of work to do, but I encourage you to be less humble in this case about what you all created because within it really lies the power of the opportunity that we have together.
David: Well, look, I appreciate you saying that. We’re excited to work with you guys, but we’re also excited to introduce you and get you involved with other firms in the Valley and other startups in the Valley, because we think that’s where the compounding power happens. And if my knowledge and the power of networks only is captured in the fact that I know you, and then I can help introduce you to a bunch of people, I will have done a very good thing. So I’m really excited about working with you.
Elisa: As part of this, MLT is also launching an impact fund. I wanted to hear a little bit more from you, John, about why you’re raising the impact fund and what it means for MLT in the long term.
John: It’s a critically important starting point for a new and more ambitious approach to taking our work in the tech sector to the next level. We’ve laid a strong foundation, but there’s a lot more work to do as it relates to expanding the number of black and brown founders that have access to and are ready for venture investment from firms like Greylock, who are working at places in Greylock’s portfolio, and those of other venture firms, and even collaborations between venture firms that are minority-led. We see this impact fund as a way to really become a capital creation vehicle over time, to scale and supercharge our work and tackle that at a much bigger level. You referred to tech, Elisa, as the epicenter of wealth creation, and it’s also the epicenter of wealth disparity. That’s the reason it’s important that Greylock has given us the opportunity to be an LP in their Greylock’s 16th fund. That creates the beginnings of a model that Dave and his partners are so guiding to help us introduce and engage with other VC and private equity firms. If we do that, I think we’re going to have a uniquely compelling fundraising proposition for philanthropists and even impact investors. With access to the most exclusive capital pools in the world – and the ability to work on all these different threads to move the needle on minority participation, racial equity, and diversity inclusion in the tech ecosystem – think about the ability to go to philanthropists and impact investors and say for every dollar that you contribute to our impact fund, that will create a 4X impact multiplier on their contributions. And that impact multiplier will be focused on diversifying this tech ecosystem and attacking the opportunities to create more wealth, more impact in our communities, more jobs, and more economic mobility for people of color. So this is the beginning of something I’m incredibly excited about. It’s a new and unique approach. It’s not just about MLT or Greylock. We’re really focused on helping build relationships more broadly and expand this platform so that it really moves the needle over the next five to 10 years on diversity in the tech ecosystem.
David: This has been a very energizing thing for our partnership as well. There’s incredible enthusiasm about all the vectors of this relationship. Many of Greylock’s partners personally seeded the first $5 million to anchor this new fund because we think it really has a force power multiplier. We look forward to inviting and encouraging other great firms and great funds around the Valley to think about working with MLT as well. I’m also excited to be joining the MLT advisory board as part of that commitment.
Elisa: We’ve talked a little bit about having the ecosystem look different in the long term. What does success look like? How are you going to measure the progress of this partnership? Let’s start with you, John. You have 15 years of working on programs to move the needle in this way in other industries. What does that look like in the venture-backed startup ecosystem?
John: We’re taking a long view as it relates to this partnership and as relates to the progress that we want to see in the tech ecosystem. We believe that we can actually expand our impact on our footprint by five to 10X overall. If you think about the dimensions of that: Over the years at MLT, we’ve got about just under 2,000 folks to come over and work in tech. We think we can take that to 10,000. We’ve got about 18 startups that are funded by venture capital. We think we can take that to over 200. We’ve got about 300 MLT alums right now who are working in venture capital portfolio companies. And we think we can tend that to 3,000.
The last few areas that we’re going to be really focused on, in terms of exponential growth, is the number of venture capital investors as well as the number of companies that achieve a billion dollar or more valuation in venture capital space. I’ve mentioned that we’ve got about 60 folks who are working in venture capital firms. In the past few years, there are five MLT alums who are leading venture capital firms and have collectively raised about $350 million between them. We think we can take that number to 200 leaders. We’ve got one MLT alum who is a founder and built a company that’s achieved a billion dollar valuation. We think we can take that to at least $10 billion – 10 companies that are worth a billion dollars or more over the next several years. These are very ambitious goals. We know it’s going to be a lot of work, but we also think that the path is there, and that by working together and engaging a broader subset of like minded leaders in the Valley, we can do that. We think this will collectively result in massive increases in economic mobility, in job creation, wealth creation, and those three things will in turn transform philanthropy in our most vulnerable communities.
David: The good news is (as it should be in a partnership) that our goals mirror their goals. In the short term, I think it’s about getting our groups together and lining up the places where our operations match and setting up the specific KPIs to really start chipping away and creating progress. I think it helps by placing people inside our companies, exposing them to other opportunities and showing them that the right fit is inside our portfolio and hiring inside our own organization over time. Then, it’s about increasingly densifying the networks and the exposure to networks – the lightning storms that we talked about. Creating the density of social capital and networks that really lead to great outcomes in the longer term. In the longer term, ideally, we should be able to look back on this work (and the work that other people are doing) with pride, because hopefully it leads to many black, Latinx and Native American founders building billion dollar companies, which is something that we have not seen and we need to see. The workforce in those companies really need to better reflect the actual demographics of our country. This is the hard work that needs to be done by us and others, and it’s going to have to start now and it’s going to take time. But I’m really excited because in the long term, there’s an opportunity to make a significant difference.
Elisa: That’s fantastic. Thank you both so much for all of this. If folks are listening to this podcast and they want to get more involved, how would you direct them to get more involved?
John: We’d love to begin with that engagement. We’re at MLT.org, where you can learn more about our programs and our comprehensive work with individuals and with institutions. But also say this: at a higher level, if I am a well-intentioned senior executive or any person who wants to make a difference, and I felt a call to action at this moment in our country – if you’re not connected at all to the tech ecosystem, this is a way to get really informed about why we are and where we are. Once you feel like you’re well-informed, we’re very much happy to help you along that journey. As you get well-informed and your confidence grows, then I’d also say to take some big swings at moving the needle and the things that Dave and I have been talking about today. Those can be things like re-examining how your organization approaches your journey around racial equity and D&I, and investing in organizations like ours who are ambitiously trying to move the needle. It can also mean taking a little bit of time and figuring out a way to expand your professional networks enough such that you can engage a person of color who is trying to get into – or is already in – the tech ecosystem and find a way to help them close the network gap.
David: I agree with everything that Johnny said and won’t repeat it, but I’ll add some more basic actions. If you’re a Greylock company or you’re involved with Greylock, reach out to Holly Rose Faith around executive recruiting and our relationship with MLT. Reach out to Glen Evans around our Core Talent Recruiting. If you’re a VC firm and your firm is interested in being part of this, please reach out to us at Greylock or John at MLT. We’d love to get more fellow VCs on board with this.
Elisa: Thank you both so much for joining us today. This was a really important conversation, and I appreciate your time and you sharing your perspectives.