New data and policy insights reveal how multiple states could have created thousands of jobs and raised billions of dollars in additional funding if they passed non-discriminatory laws.
September 26, 2023 (SAN FRANCISCO) – Today, StartOut released the 2023 State of LGBTQ+ Entrepreneurship Report, revealing how specific states and metropolitan areas could have achieved greater economic success if they implemented more inclusive LGBTQ+ public policies.
Key public policy findings from the report reveal that between 2010 and 2020, there is very strong evidence that:
- Texas could have created 121,000 additional jobs, and
- Florida could have created 55,000 additional jobs
if policies like State Employee Benefits Coverage for Transition-Related Care were implemented.
- Texas could recover $42B in funding,
- Alabama could recover $10B in funding, and
- Oklahoma could recover $10B in funding
if policies like “Don’t Say Gay or Trans” Laws were repealed.
“Discrimination is harmful to people’s lives and local economies,” said Irene Tang, Director of Data and Insights at StartOut. “Previous studies have shown that areas with higher LGBTQ+ populations also have higher economic outcomes.”
“With the new report, we’ve taken this notion one-step forward by using a difference-in-differences analysis to provide evidence that anti-LGBTQ policies hurt their local economies,” Tang continued. “We analyzed 10 years of economic data, comparing states and metros that did and didn’t pass prejudicial policies to show that LGBTQ-exclusion policies harm entrepreneurship outcomes.”
The 2023 State of LGBTQ+ Entrepreneurship Report gathered data from a variety of sources, including the StartOut Index, Crunchbase, and Pitchbook, to identify insights about LGBTQ+ entrepreneurs. StartOut analyzed data from 142,000 startup founders and 95,000 companies that have raised at least $250,000 in funding between 2000 to 2022 to develop the report.
Highlights from the report show that:
- Only 0.5% of the $2.1 trillion in startup funding was raised by LGBTQ+ founders, while nationwide, 7.1% of the population identifies as LGBTQ+.
- LGBTQ+ founders created 36% more jobs, 114% more patents, and 44% more exits, despite raising 16% less funding compared to the average founder.
- Of the funding raised by LGBTQ+ founders, 85% was raised in only five metros with San Francisco raising six times more than New York City or Los Angeles and 12 times more than Denver, CO, or Austin, TX.
- The largest metros without any LGBTQ+ founders are Orlando, FL, Charlotte, NC, and Birmingham, AL, all of which are located in states without comprehensive non-discrimination policies for LGBTQ+ people.
“We’ve set out to measure not just the barriers and challenges facing these entrepreneurs, but the millions of jobs and thousands of life-changing inventions they are already creating across the U.S.,” said Dr. Vivienne Ming, inventor of the StartOut Index and Chair Emeritus of StartOut. “Even beyond those numbers, the StartOut Index maps the potential increase in jobs, innovation, and economic activity that come from passing state and local policies that celebrate how each of us add to our communities rather than how we conform.”
Methodology
The report includes insights from the StartOut Index, an interactive resource that provides data on the landscape of investment in the LGBTQ+ community. The new policy feature in the index reveals how public policies impact entrepreneurship and jobs created. This data offers unprecedented insights for government officials, nonprofits, and economic decision makers, helping them identify key policy changes that can promote or hinder LGBTQ+ entrepreneurship and economic activity.
StartOut collected monthly entrepreneurial data from its own sources as well as Crunchbase and Pitchbook from 2000 onward.
To develop the StartOut Index’s policy feature, StartOut collected data for the years 2010 and 2020. Some data were aggregated through the decade for a cumulative value.
To view the 2023 State of LGBTQ Entrepreneurship Report, please visit startout.org. To learn more about StartOut’s methodology, please visit startout.org/index/methodology/.
About StartOut
Founded in 2009, StartOut, a national 501(c)(3) non-profit organization, is the largest national organization to support LGBTQ+ entrepreneurs with over 25,000 members nationwide. Its mission is to accelerate the growth of the LGBTQ+ community to drive its economic empowerment, building a world where every LGBTQ+ entrepreneur has equal access to lead, succeed and shape the workforce of the future. To learn more about StartOut, visit www.startout.org.
About Socos
Socos Labs was created by Dr. Vivienne Ming after a career founding companies and nonprofits to overcome challenges in education, the workforce and health. Socos Labs is a mad science incubator that explores messy human problems. Socos experiments with whole new visions of work, education, innovation and inclusive economies to inform more human-centered policy. To learn more about Socos, visit www.socos.org.
About StartOut’s Sponsors
This research was made possible by a grant from Comcast NBCUniversal.
If you’d like to contribute as a data partner, financial sponsor, researcher, or project contributor, you can reach StartOut at info@startout.org.
Media Contact
Jonathan Ochart
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