Startups founded by LGBT entrepreneurs are at risk for discrimination, affecting where they locate their businesses, their ability to raise capital and how they build trust with investors.
A new study published by the Chicago Business School, and produced in collaboration with StartOut, has found that more than one in three LGBT entrepreneurs (37%) who secured or are seeking funding are not out to potential investors.
The study also reveals that lesbian entrepreneurs have a significantly tougher time in attracting investment than gay men.
Other key findings included:
- From 2005 to 2014 more than one million jobs created by LGBT entrepreneurs left discriminatory states in favor of inclusive states. Of those, 78% moved to California, New York and Illinois.
- 84% of the LGBT entrepreneurs questioned chose to operate their businesses in states that had scored a 100% positive ranking on Human Rights Campaign’s Municipal Equality Index.
- Lesbian entrepreneurs face bigger funding challenges: 12% of companies owned by GBT men have revenues of more than $5 million compared to 3% of LBT women. Meanwhile, 70% of female LBT founders raised less than $750,000 in funding compared to 47% of male GBT founders who raised more than $2 million.
Economic equality is a critical step along the continuum of progress for LGBT people.
Read the study here