Closing the Equity Gap: Creating Wealth and Fostering Justice in Startup Investing – A Road Map from Silicon Valley to Wall Street

by Freada Kapor Klein, Mitchell Kapor

A social activist and an entrepreneur remake the future of investing and business, offering a win-win road map for creating wealth and addressing inequalities by investing in groundbreaking tech companies that defy assumptions from Silicon Valley to Wall Street. Companies backed by venture capital drive the U.S. economy, accounting for hundreds of billions of dollars in sales and profits. The problem is that most of the wealth created winds up enriching elites, while the businesses funded by venture capitalists widen economic inequality. Committed to doing things differently, tech venture capitalists Freada Kapor Klein and Mitch Kapor launched Kapor Capital to prove that investing in gap-closing startups—companies whose services or products close opportunity gaps for both communities of color and low-income communities—is good business. Over the past decade, they’ve broadened the definition of success to include profits and accountability for the impacts a business has on employees, communities, and the planet, helping to launch close to two hundred companies engaged in achieving social and economic justice while showing remarkable growth, with many valued in the hundreds of millions or billions of dollars. Like every VC firm, Kapor Capital has experienced high-profile blowups and total losses. But its investing principles have created a stunning new ecosystem of Black and Latinx entrepreneurs, CEOs, and investors, all devising innovative, effective solutions to address the most pernicious problems afflicting many of America’s poorest communities. In Closing the Equity Gap , Freada and Mitch share their core belief that all companies must make a positive impact and that the obstacles entrepreneurs overcome in life are a far better predictor of long-term success than the schools they attend or investment dollars they raise from friends and family. Using stories behind some of the most remarkable companies ever launched, they show that the standard investment model doesn’t work, how it can be fixed, and what the future could look like if more investors joined them.

Genres: Business, Nonfiction, Politics

272 pages, Hardcover

Published March 14, 2023

Reviews

[Ellen Baldwin · Rating 5 out of 5]

Really interesting read - there are good people out there trying create a more equal world.

[Erin Matyjasik · Rating 2 out of 5]

Some of the statistics and facts were interesting, but I found myself more interested in the stories of the start ups and the mental health sections than the ways in which the Kapor company helped them all. It came off as a bit too self aggrandizing for me.

[Sameera · Rating 5 out of 5]

I really liked Kapor Capital’s anecdotes and real life take aways from building businesses with a double bottom line of both profit and social impact. Enjoyed this read!

[Mindy Darling · Rating 2 out of 5]

Marginally interesting. I learned a bit about venture capitalism in general. However, the book is mostly one long, slow, self congratulatory pat on the back by the authors. They are better than everyone else in VC. They knew Uber would have trouble because the founders didn't take their advice about diversity (cue massive eye roll). Lots of name dropping.

It's great that they have values and are living them out in the ventures they fund. However, the tone of the book strongly insinuates that everyone who does not spend all day, every day working to solve 'inequity' as defined by the authors is a bad person. The book is also extremely repetitive. Social problem, under privileged entrepreneur, authors swoop in to save the day. I only finished the book at all because I could listen at double speed.

[Avery · Rating 4 out of 5]

Great book to read for anyone who is interested in the investing space but who also cares about people & planet. There are some great examples, stats, and ideas that were challenging (in a good way), eye opening, and made me more intentional. This book also was more engaging than your typical non-fiction book about niche business topics. I removed 1 star because there are multiple areas that are so self-promoting that you almost physically roll your eyes. Overall: excellent book to spark discussion and intentionality in investment decisions, but take the grandeur with a grain of salt.

[Monique · Rating 4 out of 5]

I really learned a lot about client focused VC. I loved the ideas and history of Kapor capital.