In the rapidly growing field of technology, promoting diversity and inclusivity is not just a matter of social responsibility — it’s a key driver of innovation and success. Yet, according to a recent article in Forbes, founders from underrepresented groups face an especially difficult time when it comes to securing funding for their ventures. And, as many underrepresented founders — including many AgeTech startup founders — will tell you, funding is just one of the difficult barriers they face, despite having what this report from Mckinsey & Company describes as the potential to outperform their peers and tap in into underserved markets.
Because we work with founders from diverse backgrounds and across a variety of industries, the AgeTech Collaborative™ from AARP is uniquely positioned to study these challenges and gain insights from those who experience them firsthand. For a year and a half, we conducted a series of conversations and candid discussions with 18 founders in the Collaborative ecosystem who are from underrepresented populations. In 2024, we published Challenges Faced by Underrepresented Founders, a paper that summarizes our findings, including the most common challenges and some paths through them. Here are some highlights.
The Challenges
The obstacles that underrepresented founders confront tend to fall into four categories:
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Preconceived biases: Each of the founders we interviewed experienced ethnic- or gender-based disparities, which lead to difficulties in attracting attention from investors and potential customers, thereby slowing company growth.
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Networking challenges: Founders from underrepresented groups often begin their entrepreneurial journeys without access to an established professional network. This has a direct negative impact on securing funding, and it also limits opportunities to form partnerships with existing ventures who have related ideas and goals.
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Unnecessary roadblocks: The proliferation of new ventures and businesses has driven an increase in red tape for accessing various resources, such as mentorship and accelerator programs. This, in turn, leads to excess time and energy spent registering for and attending startup programming — valuable time that, according to many founders, could be better spent trying to secure funding.
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The mental toll: Getting a startup funded and operational is difficult and emotionally draining under the best of circumstances. The additional obstacles facing underrepresented founders can increase this mental toll exponentially — for example, when their ideas are entertained merely as a courtesy.
Some Paths Forward
Not surprisingly, there are no simple solutions to these challenges. But the entrepreneurs we spoke with point to a set of practical strategies can help founders navigate the turbulent world of startups:
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Keep mentors in good company: Investing regular, quality time with mentors — whether accomplished individuals or a close group of industry peers — pays dividends, including opportunities to kick around new ideas in a safe environment, and hearing from others what has worked, or not worked, before.
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Focus on funding: When it comes to securing funding, hearing “no” is all but inevitable, but learning to see every rejection as one step closer to success can build resilience. In addition, focusing your efforts on organizations that actively invest in businesses owned by underrepresented founders can accelerate the path to “yes.”
- Support yourself: Shouldering the burden of entrepreneurship alone will only lead to burnout. Surrounding yourself with a support system — whether that’s friends, family, or even the people you hire — is crucial for your success in both the short and long term.
The challenges facing underrepresented founders are stubborn ones, and the landscape is continually evolving — sometimes in a positive direction, sometimes not. Yet, most of the founders we interviewed have met and successfully navigated all these challenges with strategies such as keeping their focus on their goals and leaning on their support systems. Although the road is often rougher for founders from underrepresented groups, understanding the challenges and following proven paths to navigate them can maximize the chances of success.
Read more about the challenges faced by underrepresented founders — and many other topics! — in the AgeTech Collaborative Library.
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