Entrepreneurs

Google is still mostly white guys. Why diversity in tech won't change until investors lose money, says tech insider Dan Lyons

Google Inc. APAC Headquarters, Singapore
Ore Huiying/Bloomberg | Getty Images
Google Inc. APAC Headquarters, Singapore

Google released its fourth annual diversity report and the results show that the tech giant is still largely employing white males. About a third of the staff is Asian, just two percent are African American and 31 percent are women.

Facebook's breakdown is nearly identical, according to its most recent diversity report, released in July, 2016. More than half of Facebook's workforce is white, and 90 percent are either white or Asian. Thirty-three percent are women and two percent are African American.

Both Google and Facebook say they are committed to increasing diversity and continue to make the data public.

The tech industry in general, including both Silicon Valley giants and start-ups, has long been criticized for being overwhelmingly white and male.

Dan Lyons, author of "Disrupted" and a former producer and writer for HBO's "Silicon Valley," says that won't change until the lack of diversity hits the tech money men where it hurts — in their wallets.

"I don't think [venture capitalists] care about ... being inclusive. I think they only give a sh*t about money." -Dan Lyons, author

"I think it's only going to get fixed when [venture capitalists] realize it's going to cost them money," Lyons tells CNBC.

"I think that's how craven they are. I don't think they care about making the world a better place or diversity or hiring or being inclusive. I think they only give a shit about money and this is only going to change when this hurts them financially."

Dan Lyons, New York Times best-selling author
Photo by Gary Gershoff
Dan Lyons, New York Times best-selling author

Lyons cites Google and Facebook as companies where people of color are underrepresented and where African American employees are almost "non-existent." But he thinks the recent implosion of leadership at Uber may finally be an inflection point.

The felled Silicon Valley Unicorn came under intense scrutiny after a female engineer, Susan Fowler, published a damning blog post about her year working at the transportation giant. The ensuing months have included a third-party investigation into the company's culture and CEO Travis Kalanick resigning. The scandal docked the value of Uber.

"Now with Uber in danger, I think this is maybe the wake up call," says Lyons.

Uber has "raised $11 billion. So other people have given them $11 billion to go use and you realize now, 'Oh sh*t we gave $11 billion too much to a bunch of psychos, right, who don't even know how to run this company.'

"That's a huge wake up call and I think maybe, just maybe, the VCs are going to start to ... realize they have to start thinking about building better more sustainable companies from the get go."

Lyons learned firsthand how start-up culture works when, at 52, he lost his job as a technology journalist at Newsweek and took a job at the Boston-based marketing software start-up, HubSpot. He wrote about his experience in the New York Times best-seller, "Disrupted: My Misadventure in the Startup Bubble."

Uber is "in a spiral and it all began because a woman who had worked there for a year and had a very bad experience and finally sort of got pushed out like something like what happened to me at Hubspot," says Lyons, who is a white male, but writes that he was discriminated against because he was a good 25 years older than most everyone else there.

The lack of diversity "begins with this bro culture, with this idea that we're going to invest in ... guys who all look like Mark Zuckerberg or Travis Kalanick and they're going to hire their frat brothers. ... [T]hey are actually going to hire on the basis the way the way frats get new pledges by saying, 'Who fits in the best with us?' It's like the stupidest way in the world to hire people."

"'Bro' culture is as toxic for the bros ... as it is for everybody else that is being excluded or being harassed." -Dan Lyons, author

Increasing diversity will require a fundamental change in the way tech businesses launch, are funded and grow, says Lyons.

"They have these concepts like growth hacking, or fake it 'til you make it, which basically means do any sleazy thing you can to get eyeballs to get customers to get subscribers," he says. "There's this idea that exponential growth is all they are after."

Instead, investors, founders and stakeholders would be better off building a diverse community from the start.

"My argument is that in bro culture, it's as toxic for the bros, for the men in those companies, as it is for everybody else that is being excluded or being harassed," says Lyons.

Case in point: The bro culture of Uber ended up being Kalanick's undoing.

See also:

Ex-Wall Street titan Sallie Krawcheck reveals the jaw-dropping sexual harassment she endured—and why she didn't report it

Google billionaire Eric Schmidt: These 2 qualities are the best predictors of success

Uber's Travis Kalanick isn't the only one—why Steve Jobs, Jack Dorsey and others were ousted from the companies they founded