PayPal is being sued by the founder of venture firm Andav Capital, Nisha Desai, who claims she was excluded from the payment giant’s diversity and equity program because she is Asian, according to a suit filed this week.
In 2020, PayPal made a $530 million commitment to support more Black and minority-led businesses in the wake of Black Lives Matter. In the newly filed lawsuit, Desai claims that she applied to be considered for the financial commitment but was overlooked because she is Asian, as the program sought to exclusively focus on Black and Hispanic-led enterprises.
Desai launched Andav Capital in 2018, according to PitchBook, to invest in early-stage companies. The venture firm has made at least 13 investments, including in fintech startup Acorns, the startup funding marketplace IFundWomen, and the environmental tech firm Kubik.
“Funds majority-owned by individuals of other races, including Asian Americans, are not given equal consideration,” Desai alleges in the suit, filed in a New York federal court. “Worse, PayPal and its senior management have repeatedly trumpeted the program’s focus on race, bragging in statements and press releases that PayPal’s program is for some races and ethnicities and not others.”
When reached by TechCrunch, PayPal spokesperson Taylor Watson declined to comment on the case citing pending litigation.
In her suit, Desai claims she met numerous times with executives at PayPal and its venture arm, PayPal Ventures, about her qualifications for receiving a financial grant, where Desai alleges that PayPal’s head of public policy and research explicitly told her in a July 2020 meeting that the program preferences Black and Hispanic-led firms “over other races and ethnicities, including Asian Americans.”
When PayPal announced its first investments from the $530 million commitment, the company invested in firms with at least one Black or Latino general partner, “an unmistakable racial pattern that reflected PayPal’s stated race-based purpose,” the …