The 3 Percent – Why Tech Has A Diversity Problem

July 16, 2015         By: Juan Maldonado

While there’s a lot of talk today about the 1% and their concentration of wealth, I want to take some time to discuss another number — it’s the 3% and how that number relates to our diversity problem in tech.

Why the 3%? Three percent is the graduation rate of Theodore Roosevelt High School, the high school I graduated from in Bronx, NY, in 1997. The 3% are the few that made it out.

I wasn’t supposed to make it out of my environment, but somehow I did. I escaped poverty by getting a solid education, and inching one step at a time up the economic ladder. My ambitions ultimately lead me to co-found my own tech company, Regalii — a fintech platform to pay bills anywhere in the world.

As a founder, I often hear conflicting views on diversity in the tech workforce and who is to blame for tech’s homogeneity. While there have certainly been improvements, less-than-stellar workforce statistics from the major tech companies demonstrate that we have a long way to go.

Our Diversity Problem

It’s no secret that tech has a diversity problem. Women are largely underrepresented, and Blacks and Latinos are almost invisible.

The percentage of Blacks and Latinos employed by tech companies doesn’t even come close to reflecting the overall population. Only 2% of the tech workforce is Black vs. 12% of the US workforce. The numbers for diversity in leadership positions are even worse.

In the general population, one third of African Americans can expect to be incarcerated at one point in their life and 1 in 9 black children have a parent in the prison system.

In the poorest cities and neighborhoods, an average of only 20% of black men graduate from high school. In my school, only 3% of my Black and Latino friends made it out.

Life For the 97%

In order for us to examine why Blacks and Latinos are “under represented” in tech, you have to first understand why they are “over represented” in the prison and welfare system.

If you turn on your favorite cable news program, you’d likely hear pundits mention that Blacks and Latinos from underserved communities just need to “work harder,” if they want to get ahead. I don’t think these pundits understand the situation.

In underserved communities, I can tell you first-hand that you become so focused on survival, that it can become impossible to focus on your own advancement.

Imagine entering school everyday through the gates of a metal detector. In class, next to no learning takes place. Everyone in class is in competing gangs that are vowing to kill each other. Just walking to school everyday requires you to risk your life. Somebody is eager to stab you on every corner, just for wearing the wrong colors.

Then imagine telling the kids in those underserved communities that anyone can make it to the top in America… if they’re only willing to “work hard”. That’s enough to break any child’s will. This is also exactly how I felt for 18 years growing up on welfare in the Bronx.

While I was fortunate to escape that environment, the majority never did. Many of my friends dropped out, had no opportunities, and ultimately became institutionalized one way or another.

Is It Their Fault?

These friends became products of an environment that was designed for them to fail. With the odds stacked against them, H-O-P-E is reduced to just a four-letter word. Without a solid educational foundation, the majority of my classmates just couldn’t compete in the workforce.

To get to the root cause of this issue, we have to first step back and think about where the majority of Blacks and Latinos start out – too often it is in underserved communities where there is very little emphasis on education, let alone tech. There are also almost no examples of mentors who properly leveraged their education for their advancement.

We All Suffer

This country suffers when large segments of its population are stuck in a cycle of poverty. Those who are incarcerated or on welfare, not only do not pay taxes themselves, but also cost tax-payers every single year to support them.

We also suffer from an innovation gap when education only hits one segment of our population. When this happens, startups just cater to “first world” problems.

As Michael Seibel of Y Combinator said in an interview: “Startups are best at solving the personal problems of their founders. The more diverse the founders, the more problems can be solved and the more people who can be positively impacted by technology.”

Education – Our Fundamental Issue

This is a complex problem with huge consequences if we fail. But when we talk about solutions for the lack of diversity in tech, I get frustrated to hear the conversation just focus on the top of the funnel.

“Why aren’t more African Americans starting companies?” “Why doesn’t’ Google hire more Latinos?”

Improving diversity in tech isn’t just about increasing the enrollment of Blacks and Latinos in computer science courses. It’s about making investments at an earlier stage of life, so that we can eventually build a wider funnel of Black and Latino founders and app developers further down the line.

This issue should be addressed by ensuring these future founders and developers have the fundamental skills in place to read and write; and the grit to solve hard problems themselves when they graduate from high school and go on to college.

If we could ultimately shift the conversation away from why there are so few Blacks and Latinos in tech and instead talk about why there are only 3% graduating from some high schools, then I think we stand a real chance of addressing this issue head on.

Juan head shot (1)Juan Maldonado, Co-Founder, Regalii
Juan is a co-founder of Regalii. He grew up on welfare in one of the poorest neighborhoods in New York. His passion is building financial products that simplify peoples lives. Through perseverance, Juan has managed to progress from janitor to Wall Street to Regalii co-founder.