much hope remains after the crypto winter nearly froze the sector: the Luna crash, the Celsius bankruptcy, and the arrest of FTX founder Sam Bankman-Fried for alleged fraud. Then there was the company’s setback in the midst of an economic downturn.
In 2021, web3 startups worldwide grossed a record $29.2 billion. By 2022, that number has dropped to $21.5 billion, though that’s still far more than the total of $4.8 billion and $4.2 billion such companies earned in 2020 and 2019, respectively.
Blacks who invested in cryptocurrencies were disproportionately hit hard over the winter, though many black founders and investors who spoke to TechCrunch remain optimistic about the sector’s potential for the community and society at large. If anything, last year’s economic correction was necessary, they told TechCrunch.
“The bubble had to burst”, co-founder of People of Crypto simone berry saying. “It was not sustainable and an economic correction was needed. The recession weeded out bad actors who only entered the space for quick bucks. He created an opportunity to break out of the hype cycle, clearing the way for development that will ensure the growth of the ecosystem in a sustainable way, adding value”.
Pryce Adade-Yebes, the co-founder of Utopia Labs, agreed. “This time period was a legitimate consequence of a period of rampant speculation and scamming,” he told TechCrunch. “This will be a good time to focus. Returning to the reality of solving widespread problems in the world; It’s a major change of pace for the space.”
Funding for the founders of Black web3 has only increased, and the crypto winter turned out to be the most fruitful year. Crunchbase data shows that black US web3 founders raised $60 million (of the total $11.9 billion awarded to all US web3 startups in 2022). That amount is substantially higher than the $16 million such founders received in 2021, during crypto’s record-breaking year (US web3 startups received $16.5 billion that year).
In 2017, they raised $11 million of $1.03 billion, and in 2018, they raised basically zero dollars of about $2.8 billion; note the thinning red line in the graph below. In 2019 and 2020, the founders of Black web3 raised $2.5 million and $4.5 million out of $2.4 billion and $3.2 billion, respectively.
Fundraising last year was difficult for many black founders, with many hit by the recession, though it’s quite telling that black web3 founders were able to raise record sums amid a general slump in the web3 funding market. . It seems investors are also somewhat bullish on black founders, a shift in tone from the way such entrepreneurs are generally viewed.
