Commentary: The old guard in venture reigns supreme

Funding disparity for Black founders in the U.S.

Key points:

• Black founders raised $212 million out of $29 billion in Q2 2023, representing 0.71% of the capital allocated to U.S. founders.
• In Q2 2022, Black founders raised $602 million out of $62 billion, or 0.97% of the capital allocated.
• In H1 2023, Black founders raised around $565 million out of $75 billion, which is 0.75% of all capital raised in the U.S. so far this year.
• Funding to Black founders has been on a steady decline since Q1 2022.
• Black founders have never raised more than 2% of capital in any given quarter.
• The decline in funding suggests waning investor interest, despite momentum in 2020 driven by the Black Lives Matter movement.
• There are two different worlds within the venture ecosystem: the old guard with billions of assets under management and the new guard of emerging fund managers, many of whom are diverse but lack significant funds.