Yesterday I discovered The Information’s VC Diversity Index. The index is designed to offer insight into the level of diversity across the industry by generating a score for each firm. (If you’re interested in its underlying methodology, The Information has written about it here.) While it’s a good start, it misses an important point: measuring diversity on the basis of race and gender alone tells us very little about each firm’s level of socioeconomic diversity.

We know that upward mobility is, in large part, a result of economic connectedness (the share of high-socioeconomic-status friends among individuals with low socioeconomic status). We also know that diversity is, among other things, a question of representation. In order to adequately compare the diversity of one firm against another, we need a more sophisticated way of thinking about diversity and how it manifests. Here’s a personal anecdote to illustrate my point.

Prior to joining FreeUp (now Wagestream, briefly Earnd by Greensill), I didn’t know what a start-up was. I was fresh out of General Assembly and needed a job (I’d been made homeless while at sixth form and didn’t attend university). I joined the company because I was excited by the prospect of working with such a small team, not because I knew anything about start-ups. In fact, I only managed to get an interview with the company because I knew somebody who knew somebody:

In 2015, I worked as an apprentice for a small software agency based in Old Street. I resigned a few months later, but had stayed in touch with the firm’s director. In 2018, and within a few weeks of completing my course at General Assembly, he’d introduced me to one of FreeUp’s three co-founders. (It should also be noted that my attending General Assembly, whose courses cost north of £9,000 at the time, would have been an utter impossibility had I not received a full scholarship.) My first foray into the world of start-ups was entirely serendipitous.

At FreeUp, I had the opportunity to work with a three-time founder (who’d later become the Head of Google for Start-ups U.K.), an ex-VP of Engineering at the once-hot Funding Circle, and a former Accenture consultant and Oxford alumnus. To say this experience changed my life is an understatement. FreeUp gave me access to a world I hadn’t known existed; a world of “pitch decks”, “venture capital” and “unicorns”. After having spent the best part of three years at FreeUp, I suddenly became aware of my own social mobility.

My story highlights something important about the way the world works. Many people, especially those from lower socioeconomic backgrounds, are, for all intents and purposes, “locked out” of entire industries and an enormous amount of luck (and hard work) is required to offset this imbalance in opportunity. Harvard’s study into the impact of economic connectedness tells us exposure isn’t enough; cross-class relationships need to be actively encouraged and nurtured. As somebody from an incredibly poor, single-parent, ethnic-minority household, the odds were overwhelmingly stacked against me.

All of this is to say that The Information’s VC Diversity Index, and other initiatives like it, need to go further in their analysis; race and gender are not enough. As we’ve seen very recently with Kwasi Kwarteng’s disastrous mini-budget, your socioeconomic background and ability to cross class boundaries matters when you’re in a position of power. The start-up ecosystem relies on venture capitalists to invest in the companies of the future, companies that cater to all of society’s needs; assembling teams that truly reflect the diversity of the world around us and not only leave, but actively carve out, space for social mobility, is absolutely crucial to that mission.