Venture capital financing has never been strong for women or black and brown founders. Together with Crunchbase, we've been tracking funding levels to identify moments of progress and regression for marginalized entrepreneurs.
For example, Black founders raised record amounts of funding in the bull year that was 2021, but that amount dropped substantially as the market cooled and many DEI (diversity, equity and inclusion) measures receded. Women, on the other hand, have received consistent funding over the past few years, hovering around 2%. However, funding for mixed teams has been steadily increasing, meaning female founders see bigger checks if they bring a male co-founder along for the ride.
Here you'll find all the stories you need to know to stay up-to-date on the ups and downs of funding for marginalized communities.
Read about funding for black founders
Funding for Black founders has steadily declined since 2021, implying that investors have lost interest or focused on backing Black founders. This is a big deal because after the murder of George Floyd, the corporate and startup ecosystem promised to better support Black founders. However, it seems that many of those commitments have fallen by the wayside. Last year, Crunchbase found that Black founders in the US raised 0.48% of all venture dollars allocated last year, or about $661 million out of $136 billion.
Since 2022, TechCrunch has been talking to experts to find out what it takes to help drive funding for Black founders. Turns out, the story hasn't changed in over a decade. For years, Black people in the ecosystem have been asking for more opportunities, more money, more trust, less bias, and less pattern matching. None of this seems to be happening so far.
In 2022, Black founders raised just 1% of all venture funding, which, believe it or not, was a drop from the 1.3% raised in the record-breaking year that was 2021.
Read about funding for female founders
Meanwhile, funding for women has remained constant (or stagnant) depending on whether you consider a glass of water half full or half empty. The good news is that funding for mixed teams is increasing; Only solo female founders seem to face more challenges when it comes to raising money from investors.
Last year's funding also saw some ups and downs, but still nothing dramatic enough to change the situation for solo female founders.
Read about funding 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 seeking money from investors. Latino founders also face difficulties raising capital, as funds allocated to that group are often as low as those to the Black community.
Members of the LGBTQ community also face their own challenges when seeking investment capital. To help collect data, last year, Crunchbase announced that it would officially begin tracking the amount of venture capital dollars allocated to LGBTQ+ founders.
Read comment on financing.
Experts, investors and founders alike have had many ideas about funding levels for marginalized groups. We have gathered some of the most pressing reflections on the most controversial issues related to today's unequal access to finance.
Read the view from beyond the US
But women and people of color don't just face challenges in the US. Marginalized founders across Europe have shared their stories about what it's like to raise money. Many of them also spoke about their dreams of entering the American market, despite the shortcomings many minorities face here.
