Venture capital funding has never been abundant for women, Black founders, or founders of color. In partnership with Crunchbase, we've been tracking funding levels to pinpoint moments of progress and setbacks for marginalized entrepreneurs.
For example, Black founders had a strong year in 2021 and raised record amounts of funding, but those amounts dropped significantly as the market cooled and many DEI (diversity, equity, and inclusion) measures were rolled back. Meanwhile, women have been consistently raising funds over the past few years, hovering around 2%. However, funding for mixed-gender teams has been steadily increasing, suggesting that female founders can receive bigger checks if they bring in a male co-founder.
Here are 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 black founders
Funding for Black founders has steadily declined since 2021, suggesting investors have lost interest or focus on supporting Black founders. This is a big deal because after the murder of George Floyd, the venture and startup ecosystem promised to step up support for Black founders. However, many of those promises appear to be unfulfilled. Last year, Crunchbase revealed that Black founders in the U.S. raised 0.48% of all venture funding allocated last year, which amounts to about $661 million out of $136 billion.
Since 2022, TechCrunch has been talking to experts to find out what it takes to increase funding for Black founders. After all, things haven't changed in over a decade. Black people in the ecosystem have been asking for more opportunity, more funding, more trust, less bias, less pattern matching for years. So far, none of this seems to be happening.
In 2022, just 1% of venture funding was raised by Black founders, down from 1.3% in 2021, which, believe it or not, was a record-breaking year.
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Read about funding for women entrepreneurs
Meanwhile, funding for women has remained steady or stagnant, depending on whether you view the glass as half full or half empty. The somewhat good news is that funding for mixed-gender teams is on the rise. It's only solo female founders who seem to face more challenges when it comes to raising money from investors.
Last year's fundraising had its ups and downs, but nothing dramatic enough to bring about big changes for solo female founders.
Read about funding other vulnerable groups
While black founders and women dominate the conversation when it comes to inequitable funding, other communities also face challenges when seeking investor capital. Latino founders also struggle to raise capital, and the funding allocated to them is often just as low as that of the black community.
Members of the LGBTQ community also face unique challenges when seeking investor funding, and to help gather data, Crunchbase announced last year that it would officially begin tracking the amount of venture capital funding allocated to LGBTQ+ founders.
Experts, investors, and founders all have different thoughts about funding levels for marginalized groups. We've compiled some of the most pressing thoughts on the most contentious issue regarding unequal access to funding today.
Read non-US perspectives
But it's not just in the U.S. that women and people of color face challenges: Marginalized founders across Europe shared their stories of what it's like to raise funds, and many of them shared their dreams of breaking into the U.S. market, despite the odds many minorities face in the country.