Jonathan Greig
| September 30, 2021
| Topic: Finance
Blavity CTO Jeff Nelson on scaling, microservices, bootstrapping, and VC funding
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A new report from Crunchbase has found that many of the financial commitments made during the global protests over racism last year have fallen to the wayside amid a record year of investing.
Despite reaching a five-year high, Black women still receive a tiny fraction of VC dollars. Startups with at least one Black woman as a founder have raised around $494 million so far in 2021, surpassing the $484 million raised in all of 2020, according to Crunchbase data.
Black women are also better represented in the subset of funded Black founders than women, in general, are among all the US-financed startups. About 30% of funding to Black startup founders every year goes to companies led by Black women, while funding to female founders overall is consistently in the single-digit percentages.
When asked about their findings, Gené Teare, Crunchbase’s senior data journalist, told ZDNet that the amounts and proportion of venture funding to Black-founded startups remain low as we head into the second quarter of 2021.
Teare added that the leading sectors over the last five years are financial services, professional services, and healthcare for Black-founded startups.
Calendly, Rocket Lawyer, Cityblock Health and Flutterwave are a few of the Black-founded companies that have raised significant funding in 2021, Teare said.
“Year to date, funding to Black-founded companies in the U.S. had topped $2.2 billion — more than double the amount for the whole of 2020 when $1 billion was invested. But the proportion of funding to companies with Black founders remains proportionally low, although it has also moved from 0.6% to over 1% of all venture funding in the US,” Teare said.
“There is an increased interest and awareness around issues of racial justice in the venture world. Some positive signs are that more Black-led firms and funds have invested in Black and other underrepresented startup founders, more Black investors at traditional firms are being promoted to partner level, and a greater percentage of VC funding to Black startup founders is going into early-stage rounds, several of which have been quite large.”
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Jonathan Greig
| September 30, 2021
| Topic: Finance