The Black Venture Capitalists Who Are Changing the VC Industry
Venture funding to Black investors bounced back in 2022 after a precipitous dip the year before.
Funding to Black VCs in the US in 2022 rose to $3.4 billion from $2.3 billion in 2021, according to the most recent Crunchbase data. The $3.4 billion matches the total Black VCs raised in 2020, the data shows.
Yet that total is about just 2.1% of the funding the venture-capital industry raised in 2022.
Venture investors in the US hauled in $162.6 billion overall — the most they’ve ever raised in a single year, according to a recent PitchBook report. It also marks the second consecutive year that VCs in the US raised more than $150 billion and are sitting on just shy of $300 billion in dry powder, or money waiting to be invested, the report said.
“It can sometimes be disheartening to watch the numbers because they consistently don’t move and they typically move in the wrong direction,” Kimmy Paluch, a cofounder and managing partner of the Salt Lake City, Utah-based venture firm Beta Boom, said. “It can be a little bit as if you’re fighting against headwinds that will never die.”
Despite the record levels of capital in 2022, venture funding to Black-led startups dropped by 48% in 2022 from the year before, according to Crunchbase data.
Yet Black VCs like Paluch are addressing such long-standing diversity, equity, and inclusion issues in the VC industry head-on by starting their own firms or by leading funds to slowly move the investing needle toward more underrepresented founders whom the VC sector has traditionally overlooked.
Do you know of other Black VCs who started or lead funds to back underrepresented founders? Let us know by contacting Vishal Persaud at vpersaud@businessinsider.com and April Joyner at ajoyner@businessinsider.com.
