There’s a story that’s relatively famous in the tech world, but which I hadn’t heard until my friend Andrew Ritchie told it to me over beers recently. We were talking about tech’s diversity problem and its monumental state of denial thereof; its devoted insistence that tech is the world’s one true meritocracy, where there’s no way to get ahead but hard work and a quick mind. Andrew, a coder who is also black, has a different point of view.

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It’s a story about PayPal, the payment processing company you wouldn’t have much reason to think about if you work outside of tech. But its ubiquity, its success, and the outsized wealth of its founders have made it legendary within the industry. It’s seen as the archetypal startup, with highly sought-after founders well-regarded for their wisdom on building a great company. Back in 2012, one of those founders, Max Levchin, came to a class at Stanford taught by another of its founders, Peter Thiel. The subject, obviously, was creating a successful startup. As their talk wound on, as transcribed by then-student Blake, the conversation turned to the subject of building the perfect team.

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Tech companies pride themselves on their immaculately designed interview process (the fabled Google interview being just one example), and at the time PayPal was giving an engineering test as well as conducting a personal interview designed to find “cultural fit,” or, roughly, whether or not a candidate was exactly like everyone else who already worked at PayPal. After acing the engineering test, an interviewee was asked what he liked to do in his spare time. If he’s like me, he was probably extremely flummoxed by that question and quickly did a mental inventory of all the things he actually does do before settling on something that seemed inoffensive. He said he liked to “shoot hoops.” Levchin said:

“That single sentence lost him the job. No PayPal people would ever have used the word ‘hoops.’ Probably no one even knew how to play ‘hoops.’ Basketball would be bad enough. But ‘hoops?’ That guy clearly wouldn’t have fit in… The notion that diversity in an early team is important or good is completely wrong. You should try to make the early team as non-diverse as possible.”

When he got to this part of the story, Ritchie put down his beer and laughed in disbelief.

“That’s totally insane!” he said. “’We don’t play basketball, and we don’t know what the culture of basketball is, but when he said ‘shoot hoops’ we knew we couldn’t work with this guy.’ That’s a story they tell with pride! That’s what a perfect meritocracy looks like—if you say ‘shoot hoops’ people know you don’t fit in, and you’re out. It’s incredibly arrogant.”

This is far from the only example of the exclusion that anyone not meeting the ideal tech look faces, or blanket acceptance that those who do fit receive. Paul Graham, co-founder of the fabled startup accelerator Y Combinator (alums: Reddit, Airbnb, Genius) once told the New York Times Magazine that he could be “tricked by anyone who looks like Mark Zuckerberg. There was a guy once who we funded who was terrible. I said: ‘How could he be bad? He looks like Zuckerberg!’” Just this past December, Dropbox tweeted a photo captioned “Diversity at Dropbox,” which seemed to contain five white people and one Asian, prompting widespread ridicule (a press representative for Dropbox pointed out it was two men and four women, including one Iranian).

tech13I spoke with founders, executives, and other talented people working within tech who don’t fit the classic industry mold as both women and people of color. One thread which emerged during our conversations was a widespread belief that by limiting itself to the same type of candidate, tech companies and investors are endlessly pumping out the same types of products. This isn’t just bad for business—it’s bad for the world.

The tech industry isn’t unaware of its diversity problem. If anything, it’s obsessed with talking about it. Every major tech company now has a splashy page on its website outlining its diversity program. “The most innovative company must also be the most diverse,” reads Apple’s page. At Facebook, a press release reads, “We need an employee base that reflects a broad range of experiences, backgrounds, races, ethnicities, genders, sexual orientations, abilities and many other characteristics.”

Dropbox said similar things when I discussed their ‘diversity’ tweet with a press spokesperson, supplying a statement which read in part, “We’re committed to building an inclusive workplace at Dropbox, and we know we still have a lot to do… Improving our diversity continues to be one of our top priorities in 2017 and beyond.”

In many ways, Google has made the biggest splash of any major firm. In an exclusive interview with USA Today in 2015, Nancy Lee, its vice president of people operations (a title exceedingly egalitarian in both name and capitalization), revealed that the company had spent $115 million over the past year on diversity initiatives and planned to spend $150 million more in the next year. “Google wants to secure its own future by establishing itself as a leader in diversity as it grows beyond search advertising into myriad other businesses in an increasingly global marketplace,” USA Today wrote. But when Google released its updated figures the next year, its demographic makeup was unchanged. How exactly you can buy diversity was not explored in the piece, though it did repeat eye-popping numbers earmarked into similar “diversity funds” by Intel and Apple.

“Diversity in tech has become more fashionable now than ever,” said Eddie Washington, the recruiting and talent lead at Genius. “Everyone’s like, ‘Let’s do a Medium blog! Let’s do a convention about diversity!’ But it’s more of a PR thing. It’s like people are grandstanding. It’s gotten weird. I don’t think it should be a PR tool. If you want to do it, do it. Don’t stand on a soap box.”

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The numbers speak for themselves. Despite this messaging focus, tech remains overwhelmingly the domain of white and Asian men. According to information from the Bureau of Labor Statistics, women make up just 27% of computer engineers and systems managers and 17.9% of software developers; black employees account for only 5% of professionals in both categories. A recent New York Times investigation found that technical workers at Google, Microsoft, Facebook and Twitter are on average 56% white, 37% Asian, 3% Hispanic and 1% black. This is out of alignment not just with the population of America as a whole (where women are more than 50% and black people are 13%), but even the demographic makeup of computer science and engineering graduates. Using US Community Service, the Times found the current breakdown of bachelor’s or advanced degree graduates in those fields to be 57% white, 26% Asian, 8% Hispanic and 6% black.

If tech companies truly want to do the things they claim in their rhetoric—revolutionize our daily lives, solve important problems, and build technologies that identify and target the worst of them, in the world we really live in—addressing this diversity issue should be job number one. Hiring only one class of person severely hampers this.

“When you are lacking in diversity, your products don’t really represent the needs of the whole population,” said Jessica Lawrence, the CEO of the New York Tech Alliance, a non-profit dedicated to building a more inclusive tech industry here in New York. “If you’re not solving more global problems, then you’re not really going to change the world for the better, which has to incorporate solving the problems of a very diverse group of people.”

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“Who’s solving the problems of people who live in middle America?” said Aaron Saunders, a professor, author and CEO of tech consultancy Clearly Innovative. “It’s this incestuous cycle where young white guy starts company, exits, becomes older white guy and starts funding companies—I mean, what kind of company is he going to fund? He’ll invest in people in his network: other young or middle-aged white guys.”

If you’re a reasonably wealthy 20-something white man who’d prefer to never go outside and interact with another human being, you’re in luck! Hundreds of companies worth billions of dollars are excited to serve you. There are services which allow you to do your laundry and dry cleaning without leaving the house. Dozens of startups would like to deliver you food in various states of preparedness, including Blue Apron, UBEReats, Munchery, Foodpanda, Swiggy, and Zerocater to name just a very few. Or, if the concept of food is too much for you full stop, just get some Soylent, the tech world’s trendy beige nutrient goo. If you’re any other kind of person, however, you’re out of luck. The 2016 class of Y Combinator companies has more startups addressing the needs of drones than the needs of women.

Of course, there are people working on other problems, but they’re largely outside the tech mainstream and struggling to gain entry.

Jihan Thompson and Jennifer Lambert are the founders behind Swivel Beauty, a site and app which identifies salons catering to people of color around the country and lets users book appointments and leave reviews. It was born out of their frustration at finding a decent place to get their hair done while traveling.

“The black hair care market is worth $500 billion,” Lambert told me. “Black women spend nine times more on their hair than any other group.” Despite this huge market, Lambert and Thompson (a former beauty editor at Oprah’s O Magazine), say they have struggled to have themselves and their company taken seriously. In conversations with VCs, they often find they have a lot of explaining to do.

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“People who don’t have kinky, coily hair and haven’t had to deal with the issue and haven’t had sons that have had to deal with it, really just have never thought about it before,” said Lambert. “There’s a little bit more explanation that goes into just laying the ground work for the problem in general. Then, everyone has that light bulb moment that’s like, ‘Oh, I never thought about it.’ It’s like, ‘Neither did anyone else who made any of these beauty apps.’” The pair say they have recently seen a shift of interest into the black haircare space, but still have not secured substantial VC funding.

Andre Powers is a black tech entrepreneur in Brooklyn attempting to launch a payment services startup, Stuypend. It’s his second, after working on a financial services product with his brother and another founder. He says he never felt discrimination working on his previous product, though he agrees it’s a problem in the industry at large.

“You definitely see it. You just see it,” he said. “Young white people are the people getting funded. It’s definitely a circle. Even the people who work outside of that process, who start companies completely on their own, often are only able to do that using money from their family that isn’t always available to minority entrepreneurs.”

Paladin, a service connecting lawyers with pro-bono clients, has also had an uphill battle. Its founders are two women, Kristen Sonday and Felicity Conrad.

“We’re female led, Kristen is Latina, I’m an immigrant from Canada. Our startup is a social enterprise. That’s kind of a trifecta of outside the box,” said Conrad. “I think it’s also created a lot of opportunities for us to find the people who are really passionate about what we’re doing and really champion us as opposed to kind of falling within the traditional startup stream.”

When I ask them if they have had trouble securing meetings with potential investors because they’re women, they both agree.

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Sometimes, said Conrad, even if they secure a meeting, they “won’t get taken seriously. You’ll just have gotten the meeting because you’re an attractive young woman,” someone an investor wants to have an excuse to sit around and talk to, whether or not he actually wants to fund their company.

This experience is common. “I know a female founder who had to pitch 100 different investors before finally getting her first investment,” said Lawrence. “Her company is huge now and has substantial investment, but at least from her comparing notes with other male founders, it took her much more time and many more meetings to have anybody take her seriously. The kind of running joke is a guy can just pitch an idea and get funding, and a woman has to have a full-fledged company with paying customers and a track record before anybody will give her funding.”

The tech industry can have a huge impact on the world. It is having that impact, right now, on how we eat and work and shop and protest and fall in love (I met my wife on a dating app). Without sounding too much like a TED talk, building businesses for more than one type of person has the very real potential to immeasurably change millions of lives for the better.

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“I think the thing that turns some people off is that they think that solving problems outside of the traditional, I call them ‘privileged people problems,’ means that they have to do a non-profit or they have to do a social good company,” said Lawrence. “I don’t think that’s the case. I think you can build a for-profit company that approaches whatever you’re building in a very thoughtful, and responsible, and moral, and ethical way. Whether you’re manufacturing gym socks or you’re making an app that gets your dry cleaning delivered faster, there are ways to go about that in ways that have a more positive impact on the community.”

Saunders is more direct.

“Google can figure out how to build a driverless car, but not how to hire more people of color?” he said. “If they really wanted to solve the problem, it would be solved. Most of the founders of these companies and startups, they don’t even believe there’s a problem. And if you don’t believe there’s a problem, you’re not going to solve it.”

Photos by Eric Ryan Anderson

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