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Entrepreneurs may get boost from venture capital diversity pledge

There are at least two things necessary to become a successful entrepreneur: A good idea and money to get it off the ground. There is no shortage of good ideas among enterprising Americans, but it can be difficult for many start-ups to get access to seed money.

Venture capital firms fill this important need, but money is not spread around equally. Research shows that the venture capital industry is predominantly white and predominantly male. As such, entrepreneurs who get funding also tend to be white and male. Thankfully, the National Venture Capital Association, the industry's trade group, has pledged to make diversity a high priority.

According to an NVCA survey from 2011, 87 percent of investors were white and 89 percent were men. While most of these investors do not have a conscious bias against women or minorities, they may still unconsciously favor entrepreneurs who are white and male. Researchers who have studied the problem believe that recruiting more women and minorities to join venture capital firms will also diversify the demographics of entrepreneurs who receive funding

In early August, the NVCA participated in an event called "Demo Day" at the White House. At that event, the NVCA pledged to President Obama and the public "to advance opportunity for women and underrepresented minorities in the entrepreneurial ecosystem." Hopefully, this initiative will be embraced as an opportunity rather than as a mandate.

If you are starting your own business and need access to venture capital, you may have no idea how to find interested investors in the Denver area (or wherever you happen to live). Experienced business law attorneys can help you with many aspects of your business, including access to venture capital.

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