Over the last year, three more Black female founders have raised at least £1M of VC funding (R Grid, Beautonomy, Afrocenchix). They join that exclusive club with The Stack founder Sharmadean Reid. We see Passion Capital, Ada Ventures, Local Globe and very few others committed to this table. There has been a proliferation of training schemes established to incubate companies with Black and brown founders, but very little capital has flowed to the investors and funds best positioned to find and support these special entrepreneurs.
We need more Black and other underrepresented GPs with the power and purses to make investment decisions. People of colour and other underrepresented folks unable to allocate funds within generalist funds is not the answer. Generalist funds with no particular connections in underrepresented networks or experience of successfully supporting underrepresented entrepreneurs is not the answer.
I see a lot of talk, but not a lot of action. Funds like Impact X & Backed VC have invested in us and a few others on the list, and of course the Google Black Founders Fund has sent huge waves through the space by showing what happens when you #FundBlackFounders... but there's still a way to go.
Think about the talent we're missing and the breakthroughs that never happened as talented founders were blocked from raising investment because of the content of melanin their skin cells produce. The next generation will look back at the inequalities in funding in the way we look back at segregation and other such folly. Change is happening, but it needs to speed up. There are big problems to solve and we need the best talent from a full range of varied backgrounds.
No innovative European startup is the same as another. Each has their own specific needs and opportunities. This means that we should always focus on being as fast as possible and flexible to tailor our support to the specific circumstances of these companies. We have made great steps in putting this in place. For example, startups can apply to the EIC Accelerator at any time with a short questionnaire, slide deck and video pitch, and get a response in less than 4 weeks.
We’ve also put in place a unique funding offer combining non-dilutive grants with substantial equity investments, as well as a growing set of Business Acceleration services. But there is still untapped potential across Europe. We have to continue our efforts to fully exploit Europe’s diversity in terms of gender and cultural and geographical backgrounds.
88% of Black founders in the UK self-fund at least part of their venture. There’s always been entrepreneurialism in the Black community - there is no pipeline issue, actually an allocation issue. The lens is configured to white predominantly male founders, as a result the capable underrepresented founders are not being identified or catered for.
The dial has not moved in a significant way. A big issue is many of the institutions are attempting to solve the disparity without the appropriate approach. It is still very top heavy. A big part of the ecosystem still remains unstimulated due to such organisations remits being post seed. Utilising the existing tentacles and supporting existing communities like Black Valley, Black Girl Fest, Black Tech Fest, Code in Black Females and YSYS to support and build a robust ecosystem.
2021 has been extremely good for the digital and tech companies in the Impact X portfolio. We saw our first portfolio unicorn which is the UK's second Black unicorn - Marshmallow. World Remit aka Zepz was the first. Both companies announced their status in the 2nd half of 2021. That milestone amplified the June announcement that finally a third country has joined the US and China in minting over 100 tech unicorns, the UK. This is another marker of progress in the European tech ecosystem. Sobering, however, is that when Marshmallow closed its $85m round at a $1.25B valuation, that amount doubled the total venture capital investment that had occurred in Black led UK companies over the previous 15 years as reported by Extend Ventures in Diversity Beyond Gender.