What unique challenges do women and people of color face in the startup world? originally appeared on Quora, the place to gain and share knowledge, empowering people to learn from others and better understand the world. You can follow Quora on Twitter, Facebook, and Google Plus.

According to research from The Hamilton Project, access to capital, business networks and skill development are the three main challenges facing people of color and women-owned businesses today.

In terms of capital, female entrepreneurs received only 2.2% of venture capital funding in 2018. Women of color received less than 1%. As research from Pitchbook notes, women received $10 billion less in combined funding than the e-cigarette company Juul took in by itself. Compare this to the $109.36 million in investment funding that all-male teams received in 2018, and you see there is a clear disparity. Additionally, female-owned businesses receive loan approvals 33% less often than male-owned businesses.

Less than 1% of companies funded by venture capital dollars are black, and minority leadership representation at venture capital firms is hardly any better. Additionally, another challenge these startups face is employment. Currently, women-owned businesses employ 9.2 million people – just 8 percent of the total private sector work force. The Small Business Associates also notes that “Black/African-American owned firms…are 81% less likely to be employers than nonminority firms. Similarly, Hispanic-, Native American-, and Pacific Islander-owned firms are about 40% as likely to be employers. We need to not only provide more opportunities for women and minorities to start businesses, but for these businesses to expand and employ more people once they are off the ground. This takes access to capital, business networks and skill development.

By not addressing these disparities, we are costing our country greatly. In fact, according to McKinsey, if women had parity with men, the GDP among advanced countries would grow by 10 to 12 percent in just ten years. Similarly, The Kauffman Foundation states that “if minorities started and owned companies at the same rate as whites, the U.S. would have over one million more businesses and up to an extra 9.5 million jobs.”

I also outline several solutions our country can take from a public policy standpoint in my new book Boom: Bridging the Opportunity Gap to Reignite Startups.

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