The Secret to More Black Women Founders? Give Them a Seat at the Startup Table First
When Iman Abuzeid led her company, Incredible Health, to unicorn status in 2022, she became one of a vanishingly small club. Less than 1% of high-growth startups have a Black woman founder. That’s not a pipeline problem — Black women report entrepreneurial ambitions equal to or exceeding those of white men. It’s an exposure problem. And new research suggests a surprisingly straightforward remedy.
A study published in the Strategic Management Journal by Christopher G. Law, Travis Howell, Chris Bingham, and Y. Sekou Bermiss examines what happens when Black women get early-career experience inside a startup. The findings should reshape how investors, accelerators, and corporations think about building diverse entrepreneurial pipelines.
The “Joiner Effect” — and Why It Hits Differently
Researchers have long known about what’s called the “small firm effect”: people who work at startups are more likely to eventually start their own companies. The hands-on exposure demystifies the founding process, builds a broad skill set, and sparks motivation by surrounding employees with entrepreneurial role models.
But Law and colleagues asked a more pointed question: does this effect work the same way for everyone? Using a proprietary dataset of more than 8,000 individuals who applied to the Venture For America fellowship program between 2013 and 2023 — a group uniformly motivated by entrepreneurship and controlled for education quality — they tracked who eventually founded a growth-oriented company.
The answer was striking. Startup employment boosted everyone’s odds of becoming a founder. But for Black women, the effect was dramatically larger. The study found that Black women who worked as startup employees were estimated to found companies at a rate of 15% within 11 years of graduation, compared to just 3% for Black women who didn’t have that joiner experience. For the rest of the sample, joiners came in around 11% versus 6% for non-joiners — a meaningful gap, but nowhere near as wide.
Why the Gap Is So Much Bigger for Black Women
To understand the mechanism, the researchers conducted in-depth interviews with 39 startup employees across demographic groups. Three explanations emerged for why startup employment spurs entrepreneurship generally: sorting (entrepreneurial people self-select into startups), learning (startups provide broad, hands-on skill development), and motivation (proximity to founders makes founding feel possible).
All three appeared in the interviews. But for Black women specifically, motivation dominated.
Before joining a startup, many of the Black women interviewed described what the researchers call a “marginalized self-concept” — an internalized belief that high-growth entrepreneurship simply wasn’t a world they could inhabit. Their mental models of a startup founder looked like a white male dropout from an elite university, not like them. One interviewee put it plainly: “I thought you had to be like a Mark Zuckerberg, like a super genius, rich dropout from Harvard or something. I had not seen myself reflected in that.”
This wasn’t a failure of ambition. It was a failure of imagination shaped by a genuine absence of visible role models. Many described growing up surrounded by entrepreneurs — salon owners, restaurant operators, small business families — but no one building venture-backed technology companies. The scalable startup world felt categorically separate from their lived experience.
Working inside a startup changed that. Proximity to founders — watching them navigate funding, product decisions, and uncertainty in real time — humanized the process. One founder recalled the shift: “Those people are just people. And I’m a person too.”
What This Means for Leaders and Investors
- Exposure is infrastructure. The research makes a compelling case that access to startup environments functions as a kind of developmental infrastructure — one that underrepresented groups have historically been excluded from. Programs that place young talent directly inside startups, particularly growth-oriented technology ventures, are doing something more than workforce development. They may be cultivating the next generation of founders. Organizations like Venture For America exist precisely to create this access; the study found the effect held both for VFA fellows and for individuals who found startup employment independently.
- Recruiting diverse talent into startups is a compounding investment. For startup founders and investors: every Black woman you hire isn’t just filling a role — she’s potentially a future founder. The research suggests she will look around, absorb the process, and significantly increase her likelihood of eventually building something herself. That’s good for the ecosystem broadly, given that entrepreneurs from underrepresented groups bring perspectives and address markets that dominant-demographic founders often miss.
- Corporate pipelines may be the wrong model for this problem. The study also tested whether working at a large technology company — one of the “Magnificent Seven” — produced similar effects. It did not. There appears to be something specific about the startup environment — its visible founders, its fluid roles, its unscripted problem-solving — that does the motivational work. Well-meaning DEI pipelines funneling Black women into large corporations may be missing this dynamic entirely.
The Takeaway
Low representation of Black female founders in high-growth entrepreneurship is not, the authors conclude, a reflection of insufficient aspiration or capability. It reflects a deficit of exposure to environments where founding feels imaginable and achievable.
The fix isn’t complicated — though it does require intentional effort. Put more Black women inside startups early in their careers. The data suggests the rest will follow at a rate that should get every investor’s attention.
Abuzeid, for her part, wants her milestone to become unremarkable. “We need to be on the 700th Black woman starting a unicorn company instead of just a few.” The path there, this research suggests, begins with a seat at the startup table.
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