From DEI to Retention: How Inclusively Read the Market Shift Before Everyone Else

Most founders see the category collapse coming. They feel it in the sales cycles that stretch longer, the deals that stall in legal, the budgets that shrink quarter over quarter. They see it, acknowledge it, and then do nothing—hoping the trend reverses before they run out of runway.

In a recent episode of Category Visionaries, Charlotte Dales, CEO and Co-Founder of Inclusively—a workplace personalization platform that’s raised $20 million—described how she did the opposite. While competitors optimized their DEI hiring pitches, Charlotte was already building something completely different. Not because she predicted the political backlash or budget cuts, but because she saw a deeper trend that made DEI hiring solutions fundamentally obsolete.

Here’s how she recognized a category was dying and built for what came next—before she was forced to.

The Category That Worked (Until It Didn’t)

Inclusively launched in late 2020 as a hiring platform focused on disability inclusion. The timing looked perfect.

“We started as a hiring platform, so the ICP was actually much easier. It was like a VP of Talent Acquisition and then we started at the end of 2020. So that was like in a very good moment for DEI and where a lot of investments were getting made. So it was usually the VP of Talent Acquisition and the Chief Diversity Officer,” Charlotte explains.

The company executed well. They grew to about 50 enterprise companies, including Salesforce and Accenture. The product worked. The sales cycles were predictable. By every conventional metric, they had product-market fit.

But by early 2023, Charlotte started noticing cracks in the foundation. “We started to see, okay, the hiring market is turbulent, the DEI market is turbulent. And we need to figure out how we can actually make a sustainable impact over time that’s not reliant on strategies that will ebb and flow.”

This is the moment where most founders double down. They optimize the pitch. They target different buyer personas within DEI. They expand to adjacent use cases. They do everything except question whether the category itself has a future.

Charlotte questioned the category.

The Leading Indicator Nobody Was Watching

While everyone else obsessed over DEI budget trends and political sentiment, Charlotte was looking at workforce demographics and outcome data.

The insight came from understanding who was actually entering the workforce: “Over 50% of people from Gen Z identify with having at least one learning difference, mental health or some sort of disability.”

This wasn’t a DEI statistic—it was a workforce composition shift. More than half of the incoming generation had needs that previous generations either didn’t have or didn’t acknowledge. Companies could successfully hire these employees using DEI platforms like Inclusively. But then what?

Charlotte found the answer in retention data: “And we’re already seeing the ramifications that companies processes aren’t set up. There’s 30% of people who are Gen Z get fired or leave within the first 90 days.”

Read those numbers again. 50% have accommodation needs. 30% leave within 90 days. The problem wasn’t hiring diverse talent—companies were doing that. The problem was that companies couldn’t retain them because their processes weren’t built for how this generation worked.

This was the leading indicator that changed everything: hiring was solving yesterday’s problem while retention was becoming tomorrow’s crisis.

Why Most Founders Miss Category Collapse

Understanding why Charlotte saw this when others didn’t requires understanding the difference between lagging and leading indicators.

Lagging indicators are what most founders track:

• Deal velocity slowing down
• Budget scrutiny increasing
• Buyer priorities shifting
• Category buzz declining

These indicators tell you the category is already collapsing. By the time you see them clearly, you’re reacting, not anticipating.

Leading indicators are different. They tell you what’s coming before the market realizes it:

• Demographic shifts in who’s entering the workforce
• Outcome data showing where the real pain is
• Structural changes in how work happens
• Generational differences in expectations and needs

Charlotte wasn’t watching DEI trends—she was watching workforce composition and retention outcomes. Those metrics told her that even if DEI budgets stayed strong, hiring solutions would become less valuable as companies realized their real problem was retention, not acquisition.

The Uncomfortable Pivot Decision

Recognizing a category is dying and doing something about it are different challenges. Charlotte had 50 paying enterprise customers. She had predictable revenue. She had a clear ICP and working sales motion.

“The hiring market is turbulent, the DEI market is turbulent. And we need to figure out how we can actually make a sustainable impact over time that’s not reliant on strategies that will ebb and flow.”

The phrase “ebb and flow” is critical. Charlotte wasn’t just reacting to a bad quarter or a temporary headwind. She was recognizing that her entire market was structurally dependent on factors she couldn’t control: political sentiment, economic conditions, corporate priorities.

The question became: could she build something more durable?

Building for the Problem Behind the Problem

Charlotte’s new product, Retain, solved a different problem entirely. Instead of helping companies hire diverse talent, it helped them support any employee’s needs—accommodations, yes, but also caregiving responsibilities, mental health support, life transitions, anything.

“Our company today is called Inclusively, and we have a product that we call Retain. What it does is it allows anyone at our partner organizations to sign in and type in anything about themselves anonymously. So you can say, I have ADHD and trouble concentrating in meetings. You can say, I’m a caregiver of someone with a disability. You can say, I’m a single parent, I’m going through a divorce, whatever it is that you’re kind of going through from a personal situation.”

The platform then surfaces relevant resources the company already has. “And we can deduce what pain points have we identified. And then we serve up all the company’s existing products, benefits, services, technologies, policies, everything that usually is spread across a million different platforms at a company, and it’s hard to access.”

This wasn’t a feature expansion—it was a complete reimagining of the problem. Charlotte moved from “help companies hire diverse talent” to “help companies personalize support for all employees.” The technology was similar, but the market was fundamentally different and far more durable.

Why This Pivot Worked When Others Fail

Most pivots fail because founders move laterally—they find a different angle on the same market. Charlotte moved vertically—she found the deeper problem that her original solution was a symptom of.

The key insight: companies weren’t really buying DEI hiring tools because they cared about diversity metrics. They were buying them because their processes couldn’t support diverse working styles and needs. Once Charlotte understood that, she realized the solution wasn’t better hiring—it was better personalization of the employee experience.

“And I think that it’s a very new way of thinking about employee experience. And I think it’s been accelerated by the fact that this next generation kind of demands this. And we really need to figure out how to access on talent pool now with sort of, you know, this talent crisis that’s, you know, within the next five to 10 years.”

The Gen Z workforce wasn’t just a market signal—it was forcing companies to evolve their entire approach to employee support. Charlotte built for that evolution instead of optimizing for the old model.

The Market Validation That Proves She Was Right

By late 2024, Charlotte’s prediction about the DEI market was playing out exactly as she’d anticipated. “We’re seeing it in some instances more so with prospects than with our existing clients. Today we’re seeing it more with, you know, prospects that have been in pipeline and then that person is no longer there.”

Chief Diversity Officers were disappearing from organization charts. DEI budgets were shrinking or being redirected. The hiring platforms that had raised millions in 2020-2021 were struggling to renew contracts.

But Charlotte’s observation about what was actually happening is more nuanced than “DEI is dead.” “I think the majority of people are actually trying to make it more of ingrained in their workforce planning strategy and not have this separate siloed group because ultimately this is a part of a larger problem of not only including people, but ensuring that we have the right talent, you know, to sustain us for the next few decades.”

DEI wasn’t dying—it was being subsumed into broader talent strategy. Companies still cared about inclusion, but they needed solutions that addressed the underlying business problem: how to attract, retain, and maximize productivity from a workforce that looks and works fundamentally differently than before.

Charlotte had built for that reality while others were still optimizing for the old one.

The Pattern Recognition Framework

Strip away the specifics of DEI and Gen Z, and you’re left with a framework any founder can use to anticipate category collapse:

1. Separate symptom from disease. DEI hiring was a symptom. The disease was that companies couldn’t support diverse working styles. Solve the disease, not the symptom.
2. Watch outcome data, not budget trends. Charlotte didn’t pivot because DEI budgets were shrinking—she pivoted because 30% of Gen Z was leaving within 90 days. Outcomes predict markets better than budgets.
3. Identify structural dependencies. If your category depends on political sentiment, economic conditions, or corporate fads, you’re building on unstable ground. Find the structural problem underneath.
4. Move before you have to. Charlotte pivoted from a position of strength—50 enterprise customers, working sales motion. Most founders wait until they’re desperate. That’s too late.

The hardest part isn’t seeing the pattern. It’s having the courage to act on it when your current business is still working. Charlotte did, and built Inclusively into something far more durable than a DEI hiring platform could ever be.

The question for every founder: are you watching lagging indicators and hoping things improve, or are you watching leading indicators and building for what comes next?