Venture capital funding has never been robust for women or Black and brown founders. Alongside Crunchbase, we’ve been tracking funding levels to pinpoint moments of progress and regression for marginalized entrepreneurs.
For example, Black founders saw record amounts of funding in the bull year that was 2021, but that amount dipped substantially as the market cooled and as many DEI (diversity, equity, and inclusion) measures retreated. Women, on the other hand, have seen consistent funding for the past few years — hovering around 2%. Funding for mixed-gender teams, however, has been on the steady increase, implying that women founders see bigger checks if they bring a male co-founder along for the ride.
Here are all the stories you need to know to stay up-to-date on the highs and lows of funding for marginalized communities.
Read about funding for Black founders
Funding to Black founders has been on a steady decline since 2021, implying that investors have either lost interest or focus on backing Black founders. This is a big deal because after the murder of George Floyd, the venture and startup ecosystem made promises to better support Black founders. It seems, though, that many of those commitments have fallen to the wayside. Last year, Crunchbase found that Black founders in the U.S. raised 0.48% of all venture dollars allocated last year — that’s around $661 million out of $136 billion.
- Q4/2023 Overall: Funding to Black founders was down in 2023 for the third year in a row
- Q3’23: Black founders received 0.13% of capital this Q3
- Q2/H1’23: Commentary: The old guard in venture reigns supreme
- Q1’23: At 0.69% in Q1, the dip in funding for Black founders ‘no longer evokes an emotional response
Since 2022, TechCrunch has been speaking with experts to find out what is needed to help boost funding to Black founders. The story has not changed in over a decade, it turns out. For years, Black people in the ecosystem have been calling for more opportunities, more money, more trust, less bias, and less pattern-matching. None of this seems to be happening as of yet.
In 2022, Black founders raised just 1% of all venture funding, which, believe it or not, was a dip from the 1.3% raised in the record-breaking year that was 2021.
- Q4/2022 Overall: Black founders still raised just 1% of all VC funds in 2022
- Q3’22: Black startup founders raised just $187 million in the third quarter
- Q2/H1’2022: Black founders are seeing a decrease in funding amid economic downturn
Read about funding for women founders
Meanwhile, funding to women has remained consistent — or stagnant — depending on whether you view a glass of water as half full or half empty. The somewhat good news is that funding to mixed-gender teams is seeing an increase; it’s only solo women founders who seem to face more challenges when it comes to raising money from investors.
- 2023 Overall: Funding for female founders remained consistent in 2023
- Q3’23: Q3 data for women is just more of the same
- Q2/H1’23: Startups with all-women founding teams raised just $1.4B in H1
- Q1’23: At just 2.1% of all VC investment, funding for women remains ‘meh’ in Q1 2023
Funding last year also saw some highs and lows, but still nothing dramatic enough to shift the needle for solo women founders.
- 2022 overall: Women-founded startups raised 1.9% of all VC funds in 2022, a drop from 2021
- Q3’2022: The highs and lows of Q3 venture capital data for women startup founders
Read about funding to other marginalized groups
Black founders and women dominate the conversation when it comes to inequitable funding, but in reality, other communities also face challenges when looking for investor money. Latino founders also face difficulties raising capital, with funding allocated to that group often as low as it is to the Black community.
- Q3’22: Latin American founders see VC funding drop as investors retreat from underrepresented cohorts
Members of the LGBTQ community also face their own set of challenges when looking for investor capital. To help gather data, last year, Crunchbase announced it would officially start tracking the amount of venture capital dollars allocated to LGBTQ+ founders.
Read commentary on the funding
Experts, investors, and founders alike have had many thoughts on the funding levels for marginalized groups. We’ve rounded up some of the most pressing thoughts on the most controversial matters regarding the current inequitable access to funding.
- Debunking the myths of why venture investors don’t fund diverse startups
- How a16z’s investment into Adam Neumann further solidifies the ‘concrete ceiling’
- Funding for Black founders remains dismal — where do we go from here?
Read the view from beyond the U.S.
But women and people of color don’t just face challenges in the U.S. Marginalized founders across Europe have shared their stories about what it is like to raise money. Many of them also spoke about their dreams of entering the U.S. market, despite the shortfalls many minorities face over here.
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