Venture Capital: Black Founders Raised Four Times More Capital In The First Half This Year

The George Floyd killing spurred the flow of funds towards Black entrepreneurs.

According to a Crunchbase report, Black startup founders raised a record $1.8 billion of capital in the first six months of this year. That’s more than 4X the amount of $400 million of funding they landed in the same period in 2020. Again, compare that to the full-year tally of $1 billion and $1.4 billion for 2020 and 2019, respectively. (Inc.)

George Floyd

A key catalyst for the surge in funding to Black startups was the killing of George Floyd, which triggered a wave of sympathy for Blacks and soul-searching at America’s corporates and venture financiers.

“I haven’t seen this amount of interest and conversation in the business community at large about race since the anti-apartheid movement of the ’90s,” said Charley Moore to Crunchbase. His company offers low-cost online legal services to individuals and small businesses and raised $223 million earlier this year.

In June 2020, Softbank Group set up a $100 million fund earmarked for diverse founders, with corporations such as PayPal (NASDAQ: PYPL) and and eBay (NASDAQ: EBAY) also coming forth with commitments for funding Black entrepreneurs.

This trend also encouraged more Blacks to consider setting up new ventures. Another factor – VC firms found they were sitting on dry powder without enough founders; as a result they started scouting for entrepreneurial talent amongst minorities.

Also helping was technology. Funding deals could be struck on Zoom calls or in Clubhouse, a boon for founders on shoestring budgets and unable to travel to the VC’s office.

More needs to be done

Though the rising trend in Black financing is encouraging, it pales into insignificance in the overall scenario.

The total VC funding for startups in the first half was again a record $147 billion; however, Black founders could get only a miniscule 1.2% of it.

And public memory, even of a tragic event such as Floyd’s death, is short.

Related Story:  Black Founders Focused Collab Capital Raises $50M                                                  

Free Industry News

Subscribe to our free newsletter for updates and news about alternatives investments.

  • This field is for validation purposes and should be left unchanged.


Latest Alternative Investment News
FinTech: New Players In BNPL, And Down Under, Stocks Are Hammered
November 29, 2021     FinTech, News

Afterpay enters subscriptions market, Monzo’s Pay Later, Suncorp hops onto the BNPL bandwagon, and BNPL stocks get clobbered in Australia
Digital Assets: Grayscale’s Report Paints The Metaverse As The Next Emerging Market Investment Frontier
November 29, 2021     Digital Assets, News

A report issued by Grayscale Research, a unit of Grayscale Investments, the largest digital asset manager in the world, describes the Metaverse as a potential market opportunity worth over $1…
Artificial Intelligence: UNESCO Member States Adopt The First Ever Global Agreement On The Ethics Of Artificial Intelligence
November 29, 2021     Artificial Intelligence, News

The first ever global standard on the ethics of artificial intelligence (AI) was adopted by the member states of UNESCO at its General Conference on Tuesday. Audrey Azoulay, director-general of…
Venture Capital: Indian Fantasy Gaming Group Dream Sports Raises $840M
November 29, 2021     Latest News, News, Venture Capital

Dream Sports announced last week its raise of $840 million from investors led by Falcon Edge, DST Global, D1 Capital, Redbird Capital and Tiger Global, with the transaction valuing the…