Time and time again, when we ask founders what they need help with the most as they build out their innovative startups, access to capital comes back as the number one answer. While getting funding as an out entrepreneur has never been easy, VC firms and angel investors focusing on uplifting the LGBTQ+ community are becoming increasingly present in the startup ecosystem.
Bill Burckart (he/him) is the co-founder of Colorful Capital, an investment firm bringing capital support and scaffolding to enterprises founded and led by members of the LGBTQIA+ community. As such, he’s one of StartOut’s most active investment supporters.
With a proven history in utilizing private capital to help change lives and create meaningful impact, Bill’s passion for helping our diverse community is longstanding.
Bill, how did you first get involved in the investment world?
From the beginning, I’ve been obsessed with how private capital can be harnessed to improve the world. My initial work was focused on the intersection of civil society, business, and government, where I sought to bring those sectors together to drive meaningful change. After working in venture philanthropy for a few years, that passion evolved into using investment capital to drive transformative change.
These experiences positioned me to meet that challenge for the LGBTQ+ community. That’s when the idea for Colorful Capital came to be.
Tell me more about Colorful Capital. How did you start?
My work in the last 8 years was about how to invest in a way that drives systemic change, with a particular focus on inequality. How do you tackle that as an investor? Megan Kashner, my co-founder, had similar thoughts. What quickly went from being a conversation one day ended with launching Colorful Capital.
LGBTQ+ founders and leaders have been habitually overlooked and are routinely underestimated by mainstream capital providers. By filling financing gaps and overcoming detrimental heuristics, Colorful Capital bridges divides and strengthens economic opportunity. Diverse gender and sexual identity and expression are too often a barrier to access to capital and inclusion in traditional financial market flows. By investing in ventures led by members of our communities, Colorful Capital helps provide a pathway to success for promising ventures and their fabulous leaders.
What do you think about the current state of investment in LGBTQ-led startups?
This year, Gallup reported that 7.1% of the US population identify as LGBTQ+. From an investment standpoint, less than 1% of VC dollars go to supporting LGBTQ+ founders. Then you consider that the primary recipients of those limited dollars are white, cisgender, gay men and realize the disparities are astonishing. We have a long way to go still.
Despite this, there is a promising shift in the air. Even with all of the debate and dialogue regarding ESG considerations in investing, the trends are going upward. 90% of millennials want their dollars to back their values, and we certainly see that in the investment world.
With the current state of the economy, the next 12 months will be tricky. In periods of uncertainty, investors will be more conservative, but plenty of them will also look for nontraditional opportunities and unrecognized value. Because we’ve been so overlooked and undervalued, LGBTQ+ entrepreneurs present investors with a new opportunity to explore.
How can people learn more and get involved?
Megan and I write a regular column for NASDAQ that focuses in on the state of capital as it pertains to the LGBTQ+ community and illuminates new ways forward. I recommend checking that out if you’re interested in learning more about the stats and data behind LGBTQ+ enterprises, economics, and investment.
Of course, StartOut is the place for LGBTQ+ founders to start. With StartOut, founders find community, support, and access to capital providers like Colorful Capital. We also encourage founding teams to visit the Colorful Capital website and reach out to us to see if there’s a fit.
For those interested in learning more about how Colorful Capital invests or in getting involved on that front, we’re always eager to expand the circle and welcome new capital into the growing community of investors focusing on LGBTQ+ talent and the companies they represent.