Intel has revealed plans to invest $125 million in minority-led start-ups through its Capital Diversity Fund over the next five years. The fund is seeking to invest in start-ups founded by women and under-represented minorities.
It’s not charity, but business
Lisa Lambert, Intel Capital’s managing director said, “It’s not a social cause, this isn’t charity,” adding, “This is real business and we believe in it.”
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Various studies reveal that diversity is the key to innovation, but still, Silicon Valley has under-performed when it comes to diversity in companies. Companies with female CEOs get just 3% of venture capital money. Also only around 1% of the founders in Silicon Valley are black or Hispanic, according to a 2010 study from CB insights. According to Lambert, if studies fail to fuel the diversity, then more success stories will do the trick, and this is what Intel aims to achieve with its investments.
The problem of a lack of diversity has crippled Silicon Valley for some time, but only recently have big companies gotten serious about it. Talking about why the issue gained importance only recently, Lambert suggests that there has been a slew of news recently on the subject, referring to the heavily-covered Ellen Pao gender discrimination trial and major companies revealing their diversity figures. “Or maybe they’re getting the business value of diversity. You see better profits,” Lambert said.
Intel to provide much-needed funding
Intel, like other tech biggies such as Google, Apple, Microsoft, Facebook and others, has been making efforts to address the diversity problem that’s running rampant in Silicon Valley. All these tech firms are looking to bring the industry to a balance by introducing under-represented folks to the predominantly white male industry.
Intel is looking to shell out around $25 million a year over the next five years. For the first year, the funds will primarily be focused on start-ups in the United States, but Intel is looking to expand the program to other countries around the world. In January, Intel CEO Brian Krzanich announced $300 million for the diversity program
Lambert is a former software engineer who also supervises a networking group of female executives and has worked with minority-led companies for years. According to Lambert, the real issue does not lie in the lack of ideas or start-ups but rather the lack of funding.