How to Start a Startup: Diversity and inclusion at early stage startups
Kat Manalac, Managing Outreach Officer at YC, hosts a panel to discuss the importance of diversity and inclusion in the workforce for early stage companies.
Transcript
I started at YC in 2013 as YC's first director of outreach. And that meant outreach to potential applicants, so people who were starting companies, so basically people like you. And when I started at YC, we had grown totally organically up until that point.
So that meant that most of the people applying to YC had heard about YC through Paul Graham's essays, through reading Jessica Livingston's book, or because they were Hacker News readers. So Hacker News started out as a Reddit for tech and startup news. But if you've ever read the comments, it might not shock you to realize that most of the Hacker News community is male.
And if I had to guess, though we don't have those specific demographics, I would guess white male. So basically I was tasked, I realized and I think Paul and Jessica realized also that there are smart hard working people all over the world who should be starting startups who weren't users of Hacker News.
So I was tasked with figuring out where are these smart and hardworking people and how do we get them to consider applying to YC? How do we get to them to consider starting a company if they hadn't started already? And so one of the things I end up working a lot on at YC is finding ways to recruit founders from what is typically underrepresented communities in tech.
And then I also think a lot about what do we do to support those communities once they're here, once they're starting companies, once they're in Silicon Valley. So to be honest, I was not super aware of the particular challenges that a lot of women and people of color face in tech when I started in 2013. So in 2012, I know the big mantra, the big thing everyone said is tech is a meritocracy.
And I wanted to believe that, I wanted to believe. And so, but in my, and I have been personally very, very lucky to work in an environment that is very supportive of me. So working at YC for example, with Paul and Jessica first, then with Sam and the other partners, I was really lucky that they took a chance on me.
That they give me a lot of autonomy and a lot of opportunity to do great But even in a place where I think I have had pretty great experience, I've had moments and I've had experiences that make me wonder whether my life, whether my job would have been easier if I were a man, right? I've struggled with a lot of anxiety about am I meant to be here, am I qualified for this job.
And there are certain experiences, for example, not so long ago, there was a founder, for example, who had a meltdown. He had a meltdown about something that frankly, I or none of the partners had any control over. And frankly, he didn't have any control over it either. But what does he do? He calls me and he yells. He starts yelling uncontrollably.
And as I'm on the phone with this founder, I'm thinking, why am I the target for this? I don't see him yelling at other partners. I don't see him yelling at other male partners. And it just really bothered me and it really set me back for a little while. And so, frankly, in the work that I do with founders, that is what sort of really makes me realize that we have such a long way to go.
So for example, just in the last batch, I had founders tell me stories about being asked out on dates by customers or by investors. We had one woman who was told by an investor that she needed to find a white male co founder to pitch for her. We had one woman at demo day, she was a non profit founder who an investor came up and said, hey, I'll give you $2,000 if you babysit my kids.
And I'm like, what the fuck? I think what strikes me is that we are living in 2017. We are living in one of the most liberal places, most progressive places in The United States, if not the world. So what I believe is that we have an opportunity here to do better.
And I'm excited for you because I think that one of the things that's most exciting is that you have this opportunity to build a culture from scratch. Companies are basically like their own countries. And you have the opportunity to build the world that you want to live in. So some of the best founders I've worked with are ambitious, they're idealistic, they sign up to solve these big problems.
Because they see that they're unsatisfied with something they see in the world and they think like, hey, I have the opportunity here to make real change. So you end up creating an ecosystem with its own rules, its own structure, and its own culture. And that will be modeled based on your personality and your beliefs as founders.
So when Sam asked me to host this workshop, I realized that YC doesn't have a playbook. We don't have a playbook that we just go to that walks early stage companies through how to think about DNI issues. But if you've paid any attention to the tech news in the past few years, you've realized that there's a momentum building up around the conversations around D and I.
And basically, I think you all realize at this point, as I have, that most companies really feel and wish that they had thought about this stuff earlier on in the life cycles of their company. So what I decided to do was I decided to talk to as many YC companies as possible. I wanted to find out how they thought about DNI at their companies, why it was important to them.
I wanted to figure out what was working, what was exciting them about the space. And I think most importantly perhaps, what is not working. So I brought six of the people here today that I thought I had the most interesting and thoughtful conversations with. And they're gonna share their stories and observations with you.
So the folks up here, I believe, will have basically enough knowledge in this space to fill a book. But for today, we have pretty simple goals. So first, we want to better define what diversity and inclusion are. So I think the words are sort of so overused these days, especially in the media, that they become a little empty.
And so we'll talk briefly about how we define each of these terms in this context. Next, we'll talk about why D and I was important for these companies to think about and when they started thinking about it. And a little bit about why you should think about it right now, even at the very earlier stages. And then finally, we want to talk about how to build a culture that embraces hard conversations.
So diversity and inclusion, even for me as a woman and as a person of color, can feel like really scary and awkward topics. And I have a lot of anxiety about offending or angering other people. That's what scares and kind of like stresses me out the most.
But I also realize that having these hard conversations with your co founders and with the folks that work with you, These are some of the most important conversations to have. And so many of you today and many of you watching are pre hiring. So we're not gonna get into the nitty gritty of things like writing job descriptions or how to conduct interviews.
But I will share a page of resources for you that you can reference when you're ready for that stage. But today, I think we'll talk about things that you can bake into your culture from day That will help you lay the foundation of building a company where everyone is set up to do their best work.
So hopefully you'll leave here today with at least one thing that you feel excited and prepared to try to implement or try out. So really quickly, diversity and inclusion. These are broad concepts and they're going to mean different things to different companies and to different people.
So one of my favorite definitions that I've heard is by Verna Myers, who is a lawyer who does a lot of D and I consulting for the legal world. She describes diversity as being invited to the party, whereas inclusion is being asked to dance. And so diversity in this context, I think, will relate to finding and hiring people from a range of backgrounds.
What diversity is not is a code word for gender or race. And so diversity, I think, can mean a lot of things. It can mean different academic backgrounds. It can mean different ages, national origins, religions, work experiences, perspectives. And it's going to be up to you to decide what diversity means for your company and what you'd like to focus on first.
And what you decide to focus on first is going to change. It's going to change depending on certain factors. It might depend on where your company is based and what the demographics are like in that region. It might depend on your product, what is gonna be important. And so if you want to build a diverse team, you have to think about it deliberately.
Because one trap that happens is that people focus on hiring individuals. So what happens is you come up with a template in your mind for what an ideal employee would look like. And then suddenly, you have a homogenous team. So many of the alumni I've talked to who are doing this really well have said they've had to stretch themselves. They've had to think about hiring a team.
So basically, great team won't all have the same strengths and weaknesses. The individuals won't have the same strengths and weaknesses. They will have skills that complement each other. And if you think about it, in some of your contexts, if you're trying to choose a co founder, for example, you wouldn't want to work with a clone of yourself.
You would ideally want to work with someone who had complementary skills. And so, let's see, moving on to inclusion. Let's see, sorry. Most founders I talk to say that after fundraising, sort of the ongoing hardest part of their job is hiring. It's hiring great talent. But one thing that a people related challenge that is kind of less talked about is retaining.
How do you get great talent to stay at your company? So you can do the work to recruit talent, but if your culture is garbage, they're probably not going to stay for very long. So the Kapor Center just released a tech lever survey, which talks about why people voluntarily leave their jobs in tech. And I recommend you read the whole thing. It's really interesting and it's not incredibly long.
And these are just four main takeaways. So as the Kapor Center has laid out in their study, this is a huge problem and it's a very expensive problem for tech. And they've seen that D and I initiatives, if done right, can improve culture and really reduce turnover. And so Jen from Lever, who you'll meet soon, was talking about what does the flip side look like?
There's a lot of these terrible cases of what happens when you don't think about culture early. But if you do build a culture, that is great. What do you get? You get a place where people have strong personal bonds. They are loyal to your mission. They stay a long time. And so Lever, I've been specifically really impressed with.
They're at about 100 employees and they have a fiftyfifty percent gender split. And I hope when Jen gets up here today, she talks a little bit more about the positive benefits that she's seen at Lever as a result of them having thought about culture and inclusion from a very, very early stage.
So in all my conversations with YC alumni, the thing I heard repeated over and over again is that inclusion is just one aspect of building a great culture from scratch. Inclusion is really about building a culture where everyone can feel safe and where people don't have to shy away from having these really tough and awkward sometimes conversations.
So we'll talk about some of those ways that companies are tackling that challenge on the panel. But first, let's talk really briefly about why you might even want to start thinking about this right now. So there's a great McKinsey study that came out in 2015 that I included in the resources doc that I suggest you read. But here are some thoughts from YC alumni.
So Porter Braswell is the founder of a company called Jopwell. And they connect black and Latinx and Native American people with jobs. And he described why it's important in this way. How can you build world changing products or services if you don't have a complete understanding of the different perspectives that exist in the world?
The founders of XVivo, another YC company, learned this the hard way. They said, we figured out early that if we hired people who came from the same academic background, they approached problems in the same way. X Vivo brought up a really great example to illustrate that point. And I wanna kind of like do a quick experiment here.
So how many of you keep your ketchup in the fridge, in the refrigerator? How many of you keep your ketchup in the cupboard? Woah. So there's a great episode of the podcast Reply All, where they interview Scott Page, who's a professor at the University of Michigan who studies teams. So Scott says that language, age, geography, personal hardship, that is all going to influence how we solve problems.
And he gave this example of where you keep your ketchup. So it turns out after he did this study, if you are British or African American from the South, there's a strong probability that you will keep your ketchup in the cupboard. And if you are not either of those things, there's a strong probability that you will keep your ketchup in the fridge. So you might think like, why does this matter?
This seems like a really trivial point. But what happens if you run out of ketchup? So if you are a ketchup in the fridge person, you open the fridge and you might replace it with the things that are next to the ketchup in the fridge, which are usually mustard or mayo. But if you are a ketchup in the cupboard person, you might open the cupboard and realize, I'm out of ketchup.
So you might put malt vinegar on your fries. And so I love that example because basically it showcases that the more diverse backgrounds you have represented, the more associations you get, the more pathways to solving problems. So honestly before hearing the study, I had no idea that humans even put their ketchup in the cupboard. I didn't know people like that existed.
So I was like wow, this is blowing my mind. So anyway, recruiting might not be something that you're thinking about right now. But inclusion is, in the words of Mackenday, who you'll meet very brief in a couple minutes. Inclusion is something you can tank early on. So there are really well known stories about what happens when you don't start thinking about this at an early stage.
Is issues with the ride sharing company who will not be named. But let's also talk about Airbnb. So last year at the Fortune Brainstorm Tech Conference, the founder of Airbnb, Brian Chesky, was talking about how they were struggling with claims that Airbnb enabled discrimination, especially against the African American community. And he admitted, he was like, I think we relate to this issue.
He said, we realized that when we were building a platform, we were three white guys, Joe, Nate, Brian. He said that there were a lot of things we didn't think about. So there were a lot of steps that they're having to reevaluate now.
So now that we've talked briefly about DNI, how to define it, why you might want to think about it, I would love to invite the panel up to share their stories and observations and have them introduce themselves as well. And let's bring you guys up. Thank you, Steven. Okay.
No, I'm not. So we'll be sharing the mic.
So there, yeah, you can just pass them. Is this awkward if I'm standing? Is that okay? Okay, so I would love you to go down the line and introduce your name, your company, your role and how big your company is today. Sure.
My name is Ashu, I'm one of the co founders of Make School. We're building a college for computer science. The company's about 25 people, and I'm me and my co founder are co CEOs.
Hi, my name is Jen. I was an early employee at Lever, we build hiring software. So if you've applied for a job or an internship in the last year or two, you've probably used Lever before. As for my role, I've had various roles building and leading teams in our product, customer success, recruiting, and employee experience functions. Oh, and we're over a hundred.
And they're at fifty fifty, gender split.
Which is, yeah, among other things. But I was, it's hard to do. Hi, I'm Christina Cordova, and I manage the partnerships team at Stripe. Stripe builds tools and infrastructure to accept payments for online businesses. And we are about seven fifty people. And I also spend a significant amount of my time on our diversity and inclusion initiatives.
I think I have a mic here, can you guys hear me? All right. My name is Cat Perez and I am the co founder and CPO at Health Sherpa. We are a technology platform and team of people helping individuals enroll in marketplace coverage. We've enrolled over 840,000 folks on our platform to date. Apart from product and just leadership things, I also lead up D and I at Health Sherpa.
We're about 20, scaling up to about forty, fifty in the on season, the open enrollment season.
My name is Mackende Adeagbo, I'm the founder and CEO of DevColor. We help black software engineers set and reach ambitious career goals. We are a team of three. Hi.
My name is Mitchell Lee. I'm one of the two co founders of Penny, which is a personal finance app that you interact with by way of conversation. We are a five person team.
Awesome. So one of the things that was very clear to me as I talked to a lot of YC alumni is that diversity is sort of defined differently for every company. So I wanted to ask a couple of you, why was DNI important for you and your company? And how did you define it? Let's start with Jen.
So why was diversity and inclusion important for us? Even though we are an HR tech startup, it really just started us very organically. Like, what do we want to do as people and as coworkers? How can we build an inclusive place to work? And actually, once we started telling stories, writing blog posts about it, we realized there was a lot of resonating with both our applicants and our customers.
They wanted to know, what are you doing differently? What can we learn from? And realizing, as leaders in this space, we had a lot to do to show, here's what we're experimenting with. And sometimes, let's be real, sometimes make mistakes in.
And to be honest, what's been really cool is that it makes a lot of difference in also sales and growth so that we are able to show this is how we're approaching culture and inclusion with this much intention. It allows prospective customers to look at, well, if they are building their internal company culture that way, I want to know what their software looks like.
I want to know what their product is like. So, it's been a really huge benefit for us that it gets to be an ongoing conversation.
Cool. I wanted to, let's go with Cat. I really liked hearing about why you thought it was important, both for your business case and for culture.
Yeah, yeah. So for our team, I I was hired number seven. And we were a pretty small team, we scaled up really quickly. But by nature of who we're serving, we are serving folks of lower income, folks who would qualify for subsidies on the marketplace.
Kaiser Family Foundation released a report I think for 2015, the majority of the uninsured 65 market in The United States are people of color, over half. So 55 to 60%, specifically Latino, Hispanic communities, as well as black and African American communities. So for us it's a no brainer.
I mean our mission is to enroll these people, give them access to coverage, let them know what options they have. You can't do that if you have a team that does not reflect that audience. So for us it was really simple and straightforward why we needed to do that.
And I'd love to hear a little bit about Stripe. It's important, how you've defined it, how you interact with the founders as well. Yeah, so I would say on our side,.
we thought about this really early, but probably not in the way that you would think a company would. Both of our founders are Irish and immigrated to The United States. A lot of our really early employees are also immigrants everywhere from Honduras to Kenya to Sweden, all in our first like 20 or so employees.
And I think one of the reasons for that is because of our core mission, which is really looking at how can we enable economic opportunities and access to creating an online business no matter where you are in the world.
We've launched products like Atlas, which enable entrepreneurs around the world to get set up with like a US entity and a US bank account, which if you are an entrepreneur in Cuba or if you are an entrepreneur in Canada, very difficult to do regardless.
And I think for us early on, it was about how can we build this into our culture, because we know that we need to launch a product that works in 20 plus countries now, hopefully every country eventually.
And we need to have people on board who really understand what are the right products to be building for different entrepreneurs all around the world, and how can we make it easier for people to become entrepreneurs.
The other piece really early on was in working on diversity and inclusion, making sure that we had a direct line to ultimately people who were making decisions that affect inclusion and diversity across the company.
So for us, that means me working very, very closely with our CEO and COO and meeting with them every other week on like how are we doing on these various different aspects of diversity and inclusion throughout the company. And making sure that they are aware of what's going on and that they are approving every single thing, every step of the way.
And that way, I can go about what I need to do to make things happen within the company.
So giving you that autonomy and that ability to actually make change. Right. Where you see needed. So the next question I had is like, when did you first start thinking about DNI? And a couple of you had some interesting conversations. So I wanna talk to Ashu about MakeSchool.
And your experience sort of being two guys starting this company, when did the conversation first come up? Sure. So the conversation first came up for us when we started talking to some of our students. The first summer program we had, we had a particular female student Sophie, who from mine, my co founder's perspective was this confident badass girl who was building this amazing app.
And we never really realized that she had a lot, a bit of a struggle when she was actually going through our summer program. And it wasn't until a year later where we started to talk to some of our students about what their experience with our program was like.
And where we really heard that behind the scenes there were a lot of concerns around how she fit into the environment of the summer program. And it's important to acknowledge that it's not that the environment was explicitly sexist or explicitly discriminatory.
But there's a lot just in terms of the culture and the language that you might not obviously flag as this is something that might make someone feel uncomfortable or feel feel not included.
And it was only really hearing her experiences that that made us think one level deeper, not just the the what surface level surface level of challenge, but one level deep in that, how do we go above and beyond to try to make make the summer environment a lot more inclusive for for people like Sophie.
So it it was really shocking to us to to hear about this experience, Because we thought that things were actually pretty good and that we had a pretty good culture in the program. But it wasn't until we actually had these kind of hard conversations and got some very candid feedback to realize that we had a long way to go to improve that environment.
Can you give one example of something that she experienced that you didn't realize was giving.
her a hard time or making her less able to perform well?
Yeah, I mean some of the things were a little bit less gendered. It was around she was someone who was very athletic had a lot of hobbies around not not just computer science and app development. Most of the students were very focused around app development, computers and video games. And as a result, didn't necessarily feel like she she fit in socially as well with a lot of the other students.
And and a lot of it is also just just feeling whether like she had a place in in the environment when you when you step into a room where you're one of a few girls or one of a few people of color. It becomes a lot tougher to feel like you fit in and your your doubt whenever you're having questions or struggles about, I I don't know how to build this feature, I don't know how to solve this bug.
There there's a two questions that are being asked. Is one, is it just that I didn't learn this? Or also, it because I I don't fit here because I'm I'm not a person who should be a programmer? And there's that kind of rhetoric the society has kind of pushed, especially at the high school level where you tend to have a lot more boys who in computer science or math classes.
That sort of second line of questioning makes people, in her case and other students we've heard, makes them less willing to actually go and approach instructors to ask for help. Because they feel like, I should know this and I shouldn't be going to get help for this kind of topic. And so, being more proactive about offering help definitely.
One example that you gave that I thought was really stuck with me was that when she didn't know something, some of the very young men in the class, high schoolers would be like, you don't know that. And I think just trying to, I guess coach people through, here's an appropriate reaction when someone asks a question.
I think what, sharing a really small personal side note on that is that for the first year, for example, YC, used to wear dresses all the time. And I didn't, I wore jeans and a graphic tee because I was like, I just want to fit in. I realized I was using like way more brain cycles to like really try to like fit in and like be taken seriously than I like needed to be.
But I think if I wish I'd had this conversation because yes. I think that other people have felt the same thing and I'd never talked about it until actually right now. So there you go, sharing the story, first time. Okay, and I would love to talk to you Mitch about Penny because you are one of the kind of, you and I think Deb Collar are probably the most recent companies to go through YC.
And this is something that you've thought about a lot. And so why are you thinking about it? You're a team of five? Five. So.
I guess I should address the elephant in the room, which is I am a white male on a DNI panel. Raised a round of funding for Penny, and started to look to expand our team. At the time we were just two people. And what, a little bit of backstory here, Penny is a conversational app that helps you with your finances.
It's really intended to help people who struggle with financial literacy or just find finances intimidating. That correlates strongly with people that don't make a lot of money, lower income people. So we were building this interface which has this personality. And I'm a prolific emoji user, and so Penny ended up using a lot of emojis.
And one day my fiance kind of tapped me on the shoulder and she says, I think Penny's flirting with me. And I was like, woah, no, just use emoji. That's my style.
But kind of experiences like that, and I heard from other friends as well, really hammered home the point that if we wanna build a product that's accessible to everyone, we need to have a team that looks like the people that we're trying to help, and is kind of representative of the group of people that we're trying to build for.
So that was one of the turning moments for why we need to focus on this right now.
Okay, and Machinede, you had mentioned and I mentioned it briefly, that you think that inclusion is something that you can tank really early on. So are there any examples you've seen either on the positive or negative side of companies that you've worked with that are doing this really well?
Yeah, there's a lot I could say on this one. And I'll start with an example just from my own organization. So clearly, we're a diversity organization, so it matters a lot to us both for the team that we build, but also the membership that we build. And one of my big mistakes early on was taking it for granted. So I'm a black man, so I was like, Okay, this should be easy.
But I actually very quickly when starting the organization fell into this trap of okay the initial members will be the people that I know, because that's who it's easiest to start with.
Turns out there are not a lot of black women in software engineering in that initial set of people that I brought together and like right away it became like a very clear issue that the gender balance in our group was off and it's something that we've worked on since then, it's still not where, we still have a lot and it's something we keep an eye on.
But even just realizing that even I had a blind spot was a big wake up call for me. I'm guessing everyone has a blind spot for different groups. So I think they're small signals. The other thing I'll say is just piggybacking on people feeling like they belong somewhere. That's another thing that I think is really easy to mess up.
Just realizing that you and your company are constantly sending out signals of who belongs and who doesn't. So for us something as simple as sending out our members to go on off sites. I was making a list of here's some off sites you can consider, and I just put a list of things that I enjoy which are like zip lining or rock climbing.
And for some people that was great, for other people it sent a subtle signal again like hey is this group for me, do I belong here? So I had to actually go back to the drawing board and thankfully we had a lot of different people on our team who could add different perspectives.
And also within the membership who could help fill out that list to be something that everyone would find something that appealed to them.
That's really cool. So one of the things that I think I heard from all of you and all the alumni talked about is that one of the major kind of obstacles to start implementing really impactful D and I programs is getting people to have tough conversations. It's getting people, even if they're uncomfortable, to share and have these conversations.
So Jen, can you talk a little bit about you, what's gonna come next is sort of inspired by what Jen told me about a panel she heard about at Pinterest. But then also talk about how you've implemented that at Lever.
Yeah, the particular problem we were trying to solve for at that time, about a year and a half ago was this question of how do you make inclusion truly inclusive? To make inclusion and culture building a company wide activity, it's not just, oh, that's like the women's issue, or that's like the racial minorities issue.
So something we realized was when we had events and different discussions about inclusion, there was a smaller subset of the company that was very active, very passionate about it, and actually a larger subset that consider themselves kind of like a little bit on the sidelines.
So don't get me wrong, they thought it was a good idea, they were very supportive, but for whatever reason, they were a little bit hesitant to jump really deep in and be visible leaders for it. So I was kind of wrapping this around my head, and I met a head of inclusion at Pinterest, Candace, at an event, and she told me about this event that they had called Sorry I Didn't Mean to Offend.
And what they did was put members of the majority group, I think a lot of engineers, you know, white males, put them on a panel just like this and create a safe space where they were able to talk about mistakes, missteps, here's something I just had no idea about.
I said something and I offended someone, and I was so mortified, but you know, by having leaders and by having, you know, their colleagues speak openly about these events, really set a tone for the culture, right? Saying like, you are not going to be vilified by saying the wrong thing. We are going to assume best intentions and really try to go from there as a team.
So, what we ended up creating, inspired by that idea, was a session called DNI for Supporters. It was an internal seminar led by actually somebody on our team who's also from a majority group, a straight white male engineer. And the fact that maybe it was led by him had like two different factors.
So one, you know, maybe because when the person leading it is someone from the majority group, people are like, oh, I'm like way more curious about it, like maybe I should go, even though previous events that they didn't really seem like they were for me. And then second, again, really designing it for with that audience in mind. The subtitle to that seminar was DNI for Dummies.
So it's like, if you're ever confused or uncertain and you just didn't want to say the wrong thing, so you've been holding yourself back. This is the space to come for you. And it ended up being really successful and a lot of people who previously weren't actively involved came and shared really personal stories and opened up.
And just to wrap this up, I think something one of my coworkers had said. So, this is a black male coworker of mine who said, you know, when the cause isn't your own, it can feel really uncomfortable to speak out on behalf, even if you really, really want to. Because again, that fear of saying the wrong thing, being misinterpreted, being attacked even.
So, it really is a deliberate effort you have to make for your future employees, your culture to say that this is okay, we're going to navigate through these things just like you would with any business problem for a growing company.
So in the spirit of getting people to talk about hard things and having hard conversations, I would like everyone on this panel to share a story about a mistake they made or a misstep. Something that they wish they could have a do over on when they started thinking about D and I at their workplace. So let's talk about our mistakes. Do you want to start?
I invite you to can volunteer. I think I went already. So yeah, I messed up on gender balance for the organization at the start, and I'm still developing more strategies to sustainably fix that issue.
So I've made a lot of mistakes. I will say that we're pretty early on. And so for us I don't view it so much as mistakes, it's just kind of learning opportunities. There was a lot of learning opportunities as we started this process. How do you approach the subject with people that you're interested in recruiting? How do you position it within your own company, and have an open dialogue there.
There were also just small missteps like we had one woman that actually ended up joining our team. We had a dinner with the team. And the way that we were positioned at the dinner was just very aggressive. It was like a noisy environment. She was surrounded by men. And we were peppering her with questions.
And that's just not a way to make somebody feel comfortable and open up with you as as kind of like on a personal level. So there are a lot of things like that. But I I do think that we're learning and we're getting better at this. And step one is just talk about it openly. Yeah.
I guess I'll go next.
So we had a few missteps, I'd like to call them, early on when we started our D and I initiatives. We started about two years ago and at the time, you know, I had come on as higher number seven, so we were still pretty small. We made the really big mistake of assuming everyone had the same perception of what diversity and inclusion meant to each and every one of us in our lived experiences.
And that means everyone, including white cis males on the team. So, Jennie talked about this, but one of our biggest missteps was just not necessarily even practicing this concept of inclusion with our white cis male team members, right? Their thoughts matter and they need to be involved in the conversation as well.
So I think that was our biggest mistake is just assuming, oh team of seven, everyone conceptually agrees we should do this. But not really having that tough uncomfortable conversation about it. And then the second thing I'll just add there is, we approach it as a to do list, which is a terrible thing to do.
We were overly ambitious, we had like seven initiatives we wanted to roll out at the same time. Definitely don't do that, one is enough. We learn to approach MVP style, start small because this stuff is really emotionally taxing and intense and triggering for people. Yeah, just starting small would have been something we would have changed from the start.
So I would say for us at Stripe, probably one of the biggest mistakes we made fairly early on was we need to hire a pretty significant number of engineers in a very fast period of time in our early growth. And we hadn't necessarily hired the number of engineers that we were looking to hire in that period of time, which was about three months at that rate ever in our history.
And we set a really, like, audacious goal in terms of like the percentage of women and percentage of underrepresented minorities that would make up this kind of batch of engineers that we wanted to bring on in that short period of time. And so we set this like lofty goal, we had all these aspirations, but we actually had no plan for how to meet that goal. So, of course, we completely failed.
And it was a very hard time, I think, in the company, because we, you know, effectively, we hired all the engineers that we wanted to hire, but not many of them were people of color, or women. And as a result, we had to sit down as a company and say, like, yeah, we screwed up.
And we had to admit that, like, add an all hands in front of our entire company and start thinking about, okay, well, what are we going to do to fix this? Right? Because we are going to continue to hire engineers, and we need to set up a plan so that we can do that in a more effective way.
So what we did from that point on was say that, I think at Stripe at the time, we had this kind of disconnect between recruiting and hiring managers. So I think in a lot of ways, managers, people who need to add engineers onto their team, think about it in the context of like, well, recruiting is bringing me these candidates.
And so I'm going to, you know, find the best ones and bring them through my hiring pipeline. But the reality is that as a hiring manager, it's your responsibility for what your team looks like at the end of the day. And you need to take an active role in that hiring process.
So we actually implemented two quarters ago a goal effectively saying that every engineering manager is required to bring an underrepresented candidate, so a person of color or a woman for engineering, all the way through to the on-site stage of our hiring pipeline at Stripe.
This really put the onus on the eng managers to do this because we one, created a public, internally public spreadsheet in the company of all the eng managers, and which one of them had met the goal. And so they could see this, their team members could see this, and so if they weren't dedicating the time necessary to meet this goal, everyone would know about it.
And so that really put the power in the hands of the hiring managers to say, well, okay, like how can I go out there and meet people who are not in my direct network? And how can I ensure that we are bringing more people from different backgrounds into the funnel of our hiring pipeline?
And we've 3x the number of women in engineering that we would normally hire during that period of time through that effort.
Cool. I have a story about how we made a mistake and a really valuable lesson was how we were going to treat and kind of deal with other future problems like that. So we have a employee resource group called Levertus, and that's what we call female employees of Lever. It's a Slack channel and a dinner, I think, like two or three times a year to talk about issues, resources, mentorship.
I had found out that about a year and a half ago, somebody had created a private Slack channel called Lever Dudes.
And so this is a little bit of gray area, and I think you'll find the pattern in that, you know, the gray areas and the kind of like the awkward, uncomfortable, ambiguous problems are some of the hardest, because if you looked at the channel, there was nothing, like, super wrong with it, but there was this tone that could be interpreted as a little bit of a mocking, right?
So it was said something like, well, they have a Leverettes channel, so it's only fair. And there were some jokes that, again, nothing super crazy, but it didn't make people who were in it, other men, didn't feel good about it.
So when it was brought up to me, we talked about how one of our standards and principles for DNI is this phrase, the standard that you sorry, if you see something, say something. The standard that you walk past is a standard you accept. And even though it's comfortable, it was our job as startup employees, as leaders, to do something about it.
So we reached out to one of our founders, Randall, who was incredibly empathetic, listened to the situation, took it really seriously. The problem here was that, again, it was undermining the other leverettes channel in the group. And also, if left alone, it could potentially lead to a little bit of us versus them mentality if it were to grow, right?
So he ended up addressing the employee in question super professionally, not trying to call him out, just saying that, hey, this is not Okay, so I'd like to talk about what happened. Again, really trying to understand and listen, but then also draw the lines. And then this is, I think, the next part, what he did was really stepping up as a leader.
And again, like Stripe, we decided to address it at our next all hands. And I think that's been one of our key learnings, like you have to address things. It's not fun. Nobody goes up to all hands in front of your entire company saying like, this happened, it was super uncomfortable and awkward, but you have to do it, otherwise it becomes an elephant in the room.
So Randall addressed the entire company. And what was really interesting was that he started the story saying by being very honest about a mistake that he had made in the past.
So when the Leveritz Group was first formed, it was just four of us women just going out to dinner, he made a joke about like, well, maybe I'll grab some of the engineers and go and get pizza or something, like the same night. And it wasn't until later he realized that wasn't actually a very that wasn't what he meant to say.
Because again, if you think about why that group exists in the first place, because women may not be minorities, but they are minorities in tech, and therefore, they have experiences, burdens, hardships that you might not even know about. So the reason the group exists is not to have fun and go out and go to drinks and talk about, I don't know, nail polish.
It really is about, you know, the work and what can we do to support ourselves, each other, and just for future employees and future inclusion. And just being really honest and authentic as a leader, I think, made a huge difference.
Later that day in Slack, multiple employees both and also in person went up to Randall to thank him to say things like, you know, my previous startup founders would never do anything like that. I feel really grateful and lucky to work for a place where the leaders really care about the people, and it's very human and authentic. So I think that was a lesson that we learned.
It's not just to address it one on one. You want to prevent it from happening in the future. You know, very easily could a new hire could have been joined, you know, six months later and the same thing happens over again. So how do you address it head on, really step up as a leader? It's not going to be fun sometimes, it's not going to be comfortable, but that is your responsibility.
But the thing is, people will remember. This tone you said, what you say, your employees remember, and it gets embedded into the culture as you grow.
Yeah. Two two quick ones. One Kat touched on earlier, which is this concept of feigning surprise. So in the first summer, we had asked certain students to, hey, you zip up your folder and email it to us. And students would say, hey, don't know how to zip up a folder. And we'd say, wait, you don't know how to zip up a folder? That's like such a basic thing.
But it it operates under this assumption that this person has gone through the same education and upbringing that you have, such that they'll actually know this thing that you're asking them to do. So that was a a big one, and especially from a standpoint of a teacher, not a really great thing for a student to hear.
The second one was, starting from very early in the company, we had a very like strong voice culture in all meetings that we had.
So anytime there's some sort of discussion about different topics, it get pretty heated, voices would would raise, not in a an, I guess argumentative or in a healthy debate way, but it also means that people who are more introverted or or more soft spoken suddenly don't have as much voice.
And it's it's really a big problem when you're including those folks in meetings, and they're not really getting a chance to speak.
And so those are I think two big big mistakes that we've made, and I think the the main thing that we've done from a cultural standpoint to make it help people work on these mistakes is really assuming assuming negligence and not malice, I mean, in these kind of situations, and really focusing on where people are going as opposed to necessarily where they are.
Both my co friend and I were quite young when we were starting the company, so I had lots of lots of mistakes in terms of leadership and management. And it's only because we have a culture where other folks on the team are willing to understand that we're we're constantly trying to improve.
And similarly, if you notice some behavior and you say something about it, it's important not to make the person feel that they are a bad person for having said this. But really just help coach them so that a year from now they'll be a lot better in these kind of situations.
Cool, so now, and you've all sort of talked a little bit about some things you're doing that are going well. Shifting a little bit from the mistakes that you've made in the past or that your organizations have made in the past.
Let's start talking about things that you're trying, that you're excited about, that are paying off, that you think are going well in terms of building this great culture from scratch.
Is it going well for anyone?
And yeah, and I think it's like the thing is, we know there's no easy button. But if there are any lights that we can follow. Yeah.
Can only share what's worked for us. What's worked for us may not work for everyone. There is no playbook for the one size or blueprint that one size fits all. For us at HealthSherpa, what we did when we were hiring is we leveraged pot tools, not to be mistaken with the other POT. So people ops tools, that's what it stands for.
One specifically that we use, it was called Unitive, it's a Kapor Capital portfolio company, they're called Talent Sonar now. And we used it to run our job descriptions through it. And the job description check would score the job description, it would call out words that were heavily biased. And the reason we did that was to obviously cast a wider net.
So super easy tool to use, they had other features like the blind resume review, as well as scoring questions and making sure that each person who was interviewing a candidate was asking every single person the same question and those questions map back to competencies and skills that you need, right.
So it's not this, when you're a startup, you kind of do things in a scrappy way, but we finally built some structure around our interview process. And what we ended up finding after rolling out that one initiative is we ended up hitting our diversity goals. We 2x our Hispanic, Latinx hires and team members as well as our black team members as well. So it totally worked.
Another thing I like to throw in there as we had that new team, leveraging that initiative is we had a plus 85 revenue growth as well. I would like to attribute that to the team that we had in place. So it's just a testament to the fact that hiring diverse team members, especially when you're serving diverse communities, really does impact your bottom line.
Yeah, I actually get this question a lot because of what our organization is. A lot of founders of small companies will come up and ask, hey, how do I hire more Latinx or black or female engineers?
And what I usually actually tell them is, look, if your company is four, five, 10 people, what you should really think about is what are the attributes and skills that you need on the team and be really honest about those things.
So if you're, for example, if you're building an ag tech company, right, and all of your employees are from cities, that may not be the most effective thing when you're trying to sell, and no one has ever been on a farm.
So I think it's like step one for me is really taking a really honest look at what you need your employees to be able to do and what specific things matter to you at the stage that you're at. And then hiring against those things as opposed to just trying to like check the boxes or make your numbers look a certain way because you know when you're larger, the press will be looking at your stats.
Figure out what's important to you at your stage and then hire against that.
So I think the thing that we probably have done best is start early. We started thinking about this when we were two and three people. That's important both because the people that you hire early on are eventually gonna go on to be the leaders at your company, and hire their own teams. And so you wanna make sure that you're building the team now that you eventually wanna have.
It's also important because if you end up as a team of 15 white and Asian dudes sitting in a room, and start trying to incorporate diversity into your team at that point, good luck. Because people don't want to be a token diversity candidate, or feel alienated by a culture that's already in place. So that's a big one. We've also been pretty proactive.
So you mentioned kind of blinding the resume, or putting together good job descriptions. That at a very early stage is not quite enough, Because you're working with a much smaller funnel. So we've been very proactive about saying, no we're actually seeking out people of different backgrounds and different cultures to try to incorporate them into the team early on.
And so like partnering with like different organizations that can kind of help broaden your your recruiting funnel there was something that we I think did well early on.
So for for us talking about these issues, and whether it's community, culture, diversity, and talking about them at effectively reset points. So for education programs, when the programs actually start is a really good time. But with the company, if you you can't always go back and reset to the very beginning.
So at a company off-site, let's say in January, right after everyone's come back from winter break, usually is a good time to to address these kind of topics, because whatever impression you set, and whatever culture you start building in the first few weeks of the new year will typically last throughout the year.
The second piece is providing mentorship, especially for our students, providing mentorship who are of people who look like them, and feel like them. We have one of our alums, Leslie, who actually works at Lever. She's been amazing in terms of creating a support group for our current female students in our college program. That's gone a really long way to helping that.
And finally, talking about the numbers. It's not, you shouldn't be ashamed if your numbers are not very diverse. Last year, in the first year of our college program, had one girl out of about 22 students, which was not great. But we still talked about that, and we thought about how can we actively improve that.
And because it was open, an open dialogue, we could think about how to make plans to address that. And now we've had, we have about seven girls out of 40, or 36 students, and 100% retention throughout the year, which is a big improvement for last year. And so for both programs as well as for the staff, we've started talking about the numbers when they weren't great.
And then continue to increase and improve them year over year.
How are we doing on time? If you could each take one minute, and then I think I'll, yeah.
Sorry. Yeah, I'll keep it short then. So you're hearing a lot of answers both on the diversity side and on the inclusion side, and I can talk a lot about there. But one thing that I think adding on to those two at the end said, really you know, figuring out what works for your company that might not be for every other company.
For us, we are a SaaS organization, in that we have quite a large sales part of the company. And one of the very common associations with what makes a really good salesperson is that like, we should get some athletes in here, right? Athletes are the best salespeople. And I have no doubt that some of the best salespeople are in fact previous athletes.
But that doesn't mean that if you weren't an athlete, you're going to be not good enough, right? So, it really took to examining some of these biases and beliefs that we have in the Valley and workplaces in general and really looking at, is that actually true, and is that going to work for us at Lever?
So, we've been able to have yeah, just make, you know, the previous athletic, you know, previous college athletic experience required, like taking that out of job descriptions and making sure people are not being punished or feeling like they're being left out because they didn't have this certain background.
Last thing I'll say is we did probably 20 things to improve our intern diversity for this past year. So in 2016, we had 11% women and underrepresented minorities in our intern class, which was you know, failure, mistake. And this year, we had over 41% women and underrepresented minorities in our intern class, and we over doubled the intern program.
And I would say one of the things that we did in particular that had that effect was we created multiple ways to actually get into our intern pipeline. So your traditional way of showing up at a career fair, for example, or applying to our website were still ways that we looked at candidates. But we found that all the other technology companies were looking at those exact same candidates.
And you were looking at the same candidates that had two other great internships at Google and Facebook, etcetera. And you were all fighting over those particular candidates. When the reality is you're looking for capabilities at the internship stage.
You're not necessarily looking for people who have tons of experience because the likelihood is, if you're in college, you probably don't have very much experience at all. So how can we hunt for people who are like have those fantastic capabilities that we need, that we think are going to do really well at Stripe. And so, one of the things that we did was create two additional application paths.
One was a coding challenge that you could do in your own free time. And then submit that challenge to us and you'd actually go straight to a phone interview. You didn't even have to talk to a recruiter. And the other path was a show us your code option. So we went to a bunch of events like the Black Society of Engineers at certain different colleges, the Grace Hopper, etcetera.
And we said if you just take out your computer and show us a project of something that you've built. If we think the code is good, you automatically get to the next stage, right? So how can we think about candidates as more than just their resume, especially when in reality at a college stage, their resume probably doesn't really matter that Yeah,.
all right, so we are at time. So to kind of thank you all for sharing all your stories. And I realize a lot of you are pre hiring, so you aren't thinking about some of these issues. I created a resource list, It's sort of a living document. So I will list everything that you guys mentioned, all the resources and tools that you've used.
And Stephen is gonna be sharing that with the class and with everyone online. And Jen, I wanted you to talk a little bit about the framework creating ongoing D and I programs. But I'm just gonna have you, since we don't have time, I will hopefully work with you on a blog that you can have. Blog post. And Lever also has an incredible series.
It's a 10 part series that walks through kind of DNI for companies that I also added in the resources list of great places to start if you're looking to read up more on this. So we will be sharing that list with you and also kind of putting together all your notes and then anything else that we missed. This is such a meaty topic and there's a lot here.
But thank you also for listening and you feel free to reach out to me with any questions that you have either for the speakers or for me. I'm Kat, k a t at ycombinator dot com and I can connect you to any of these ladies and gentlemen if that's desired. So thank you again and thank you. I wanna round of applause.
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