Multicultural Innovation Lab: A New Global Focus

Jan 17, 2023

By expanding the footprint of our in-house accelerator for diverse- and women-led startups, we hope to build on five years of success in the U.S.

Key Takeaways

  • The overall funding to women-only teams in Europe dropped from 3% in 2018 to 1% in 2022.1
  • Just 0.24% of venture capital (VC) in the U.K. went to teams of Black entrepreneurs between 2009 and 2019.2
  • Up to £250 bn of new value could be added to the U.K. economy if women started and scaled new businesses at the same rate as men.3
  • The Lab has a proven track record of supporting 69 underrepresented companies, who have since raised $160MM in additional funding. 

Expanding the Footprint

Now in its sixth year and with 69 total participating companies to date, the Lab has expanded globally for the first time, with participating companies in both the U.S. and in Europe, the Middle East and Africa (EMEA). The in-house accelerator program for technology and technology-enabled startups in the post-seed to Series A funding round stage targets companies with diverse or women founders, co-founders, CTOs or other C-suite members who are developing innovative solutions across sectors.

 

Selma Bueno, Managing Director and Head of the Multicultural Client Strategy Group, says, "This new stage in the Lab's development represents our continued efforts to create a more equitable investment landscape for women- and diverse-led startups and ensure that more overlooked entrepreneurs—and their communities—have the opportunity to succeed

Creating a More Inclusive Landscape

  1. 1
    The Need Is Critical

    The overall funding to women-only start-ups dropped from 3% to 1% in 2022. Just 0.24% of venture capital in the U.K. ecosystem went to teams of Black entrepreneurs. Out of which 0.02% went to Black Females and only one Black female founder raised a Series A funding across a 10-year period.2

  2. 2
    This is a Business Imperative

    Our research has found that diverse and women-led startups in the U.S. could account for $6.8 trillion in gross receipts if they matched their percentage of the labor force and business revenues were equal to traditional firms. This would represent nearly three times the current output, with a missed opportunity of $4.4 trillion. And we believe there is similar potential outside the U.S.. Indeed,  up to £250bn of new value could be added to the U.K. economy if women started and scaled new businesses at the same rate as men.3

     

  3. 3
    We Have a Proven Track Record

    Founders of 69 companies have participated in the global Lab. Combined, they have received a total of $160M in additional funding since completing the program. 26 of them—16 of which are led by women and 11 by Black women—have raised $1M since they took part in the program. The combined valuation to date of all companies that have participated in the Lab is $670M.

Capital, Content, Connections and Community

The inaugural cohort in London comprised five innovative women-led start-ups selected from a pool of over 1200 applications. “I’m particularly pleased that the CEOs in our first cohort are all women, the majority of whom are ethnically diverse,” said Sanghamitra Karra, Managing Director and EMEA Head of the Multicultural Client Strategy Group. “The five were selected on the merits of their innovative offerings and significant investment potential. Their intersectional diversity across race and gender was seen as a key factor driving greater innovation and resilience potential.” 

 

Each of the companies selected received a cash contribution of £200,000, a five-month curated program, mentorship, networking, office space for the duration of the program and access to certain external advisors in exchange for an equity stake of 5.00%. Hear below from our inaugural EMEA Lab cohort companies, investors and the global Lab team on the ground to get a flavor of the need and what to expect. 

60 Seconds with EMCIL

Hear from our inaugural EMCIL cohort companies, investors and team.

© Morgan Stanley

The Morgan Stanley Multicultural Innovation Lab U.S. Winter 2022 cohort talks about their experience with the progam. 

Interested in Learning More?

Learn more about Diversity and Inclusion at Morgan Stanley.