venture capital There has never been a time when it was more powerful for women or black and brown founders. We track funding levels with Crunchbase to identify moments of progress and regression for marginalized entrepreneurs.
For example, Black founders received record funding during the 2021 bull market, but funding dropped significantly as the market cooled and many DEI (diversity, equity, and inclusion) measures were rolled back. On the other hand, funding for women has been steady at around 2% over the past few years. However, funding for mixed-gender teams has been steadily increasing, meaning female founders get bigger checks if they bring male co-founders with them.
Here are all the stories you need to know about the highs and lows of funding for marginalized communities.
Learn about funding Black founders
Funding for Black founders has been steadily declining since 2021, meaning investors have either lost interest or are focused on supporting Black founders. This is a big deal because the venture capital and startup ecosystem has pledged to better support Black founders in the wake of George Floyd’s murder. However, many of these promises appear to have been put on hold. Last year, Crunchbase found that Black founders in the U.S. raised 0.48% of all venture capital allocated last year, about $661 million out of about $136 billion.
Since 2022, TechCrunch has been talking to experts to understand what needs to be done to help increase funding for Black founders. As it turns out, the story hasn’t changed in over a decade. For years, Black people in the ecosystem have been calling for more opportunity, more money, more trust, less bias and less pattern matching. So far, none of this seems to have happened.
Black founders raised just 1% of all venture capital in 2022, which, believe it or not, was down from the record-breaking 1.3% raised in 2021.
Learn about funding for female founders
Meanwhile, funding for women has remained flat, or stagnant, depending on whether you think the glass is half full or half empty. The good news is that funding for mixed-gender teams is increasing; it seems only female founders face more challenges when it comes to raising money from investors.
There have been some peaks and valleys in fundraising over the last year, but nothing dramatic enough to change the tide for single female founders.
Learn about providing funding to other marginalized groups
Black founders and women dominate the conversation when it comes to unfair funding, but in reality, other communities also face challenges when seeking investor funding. Latino founders also face difficulties raising capital, with funding often being allocated to the group as low as that allocated to the Black community.
Members of the LGBTQ community also face a host of challenges when finding investor capital. To help collect data, Crunchbase announced last year that it would officially begin tracking the amount of venture capital allocated to LGBTQ+ founders.
Read reviews about funding
Experts, investors, and founders all have a lot to think about when it comes to funding levels for marginalized groups. We’ve gathered some of the most pressing thoughts on the most controversial issues surrounding today’s unequal access to finance.
Read perspectives from outside the United States
But women and people of color don’t just face challenges in the U.S., marginalized founders across Europe are also sharing their stories of raising capital. Many of them also spoke of dreams of entering the U.S. market, even though many minorities face shortages here.
