Black startup founders have a huge problem on their hands. Despite raising $2.3 BILLION in venture capital in 2020, it doesn’t come close to the $87.3 billion raised by all startup enterprises overall in the same time frame. What’s going on?
If you’re going to thrive as an innovating industry disruptor, you need one thing that many Black-led enterprises lack. It’s not talent nor clever marketing. What you need is something much harder to come by.
The disconnect ultimately amounts to a lack of network access!
Due to what CNBC calls “historical gaps in community wealth,” where white founders can solicit financial investments from family or personal connections, Black founders tend not to have the same opportunity.
Limited exposure to the right circles of influence stifles opportunities to find the right venture capital partnerships. With such limited exposure to funding opportunities, founders risking it all to boldly change the game with their products or services don’t stand much of a chance.
But a recently published Crunchbase Diversity Spotlight study is sounding the alarm.
The study hopes to expose the challenges of these brilliant ventures and push angel investors and venture capital firms to recognize what a fiscally advantageous opportunity it is to invest in Black-led startups – not just as a special niche but as an early stage fixture in their primary portfolios!
Here’s hoping investors catch on.