Diversity is part of Ulu’s investment thesis
Diversity is an essential part of Ulu’s investment thesis; it makes sense and is profitable. Currently the majority of our entrepreneurs are white men, but we look for gender and ethnic diversity, as well as diverse educational and professional backgrounds on our startup teams. Life experience related to a startup idea or market is highly valued.
Same investment criteria for all founders
Ulu has deep networks built over decades to connect to entrepreneurs from a wide variety of backgrounds. We have a wider funnel to find diverse teams including considering entrepreneurs from broader geographic areas. However once in the pipeline, we have the exact same criteria for investment for all founders. It’s a disciplined, repeatable decision-making process that analyzes risk-reward trade-offs and is proven to minimize cognitive bias.
Diverse teams are more effective
At Ulu, we believe diverse teams tend to be more effective, profitable and likely to outperform less diverse organizations because their backgrounds give them a wider array of tools and talent. A recent study in Harvard Business Review showed venture capital firms that increased their proportion of female partners saw increases in overall fund returns and more profitable exits.
While the internal debate engendered by having diverse viewpoints may spark some conflict, it often ignites more innovative ways of thinking too. A variety of perspectives helps stop the development of “group think” which has been the death of more than one good idea.
Diverse teams may also consider opportunities in markets that are underserved but largely untapped. These markets have tremendous potential for growth but traditional VCs may not be familiar with or understand the needs of such customers. Entrepreneurs with applicable life or work experience often tap into these needs and realize great economic returns.
Listen to how two of our founders view their experience with Ulu and diversity. Lisa Gelobter CEO TeQuitable, and Alexandro Martinez, CEO MatrixDS