Celebrating Black History Month: A Spotlight on 14 Black-Led Investment Firms

In honor of Black History Month, we’re highlighting 14 Crunchbase Venture Program member firms that have at least one Black founder or leader, based on our growing Diversity Spotlight dataset. We’re only covering some of the thriving investment firms that represent the growing diversity of the industry, so be sure to also check out our fuller list of Investment Firms with Black / African American Founders or Leaders.

Ulu Ventures provides early-stage investments to enterprise cloud and smart data companies. As stated on its website, Ulu believes that “diversity and data-driven decision-making is profitable.” Of the companies funded by Ulu Ventures, 76% have diverse founders, and Crunchbase data shows that it has made 144 diversity investments to date. Black-founded companies it has invested in that have exited include LearnZillion and ZeroStorefront

Co-founder and Managing Director Miriam Rivera recently shared in a Morgan Stanley survey that Ulu’s first fund is a 5x multiplier. “We’re not sacrificing anything by investing in women and minorities,” she said. “Our ability to look at startups objectively and pick the ones with great potential makes us a top-performing fund.”

Google Ventures is an investment arm of Alphabet that provides seed, venture and growth-stage funding to technology companies. The firm has made 188 diversity investments to date, including participation in Black-founded Career Karma’s Series B round last year. 

In 2020, Terri Burns became the youngest partner and first Black woman partner at GV. The company also hired an equity, diversity and inclusion partner, Candice Morgan, to create inclusive strategies for GV and its portfolio companies.

Equal Ventures is a seed-stage venture fund that backs founders and businesses that are disrupting legacy markets. The NYC-based firm was one of the first to adopt the Diversity Term Sheet Rider, pledging to embed specific language into its standard term sheets to advance diversity efforts in the VC industry.

Even before Crunchbase’s Diversity Spotlight features launched, Co-founder and General Partner Richard Kerby called out the lack of diversity in the venture capital industry, collecting and analyzing data on the issue to remedy it.

Y Combinator is a startup accelerator that invests in a wide range of startups twice a year. The Mountain View, California-based accelerator has made over 800 diversity investments to date, including Black-founded companies Novig and Promise last year.

According to its startup directory, Black-founded YC companies have a combined valuation of $11.5 billion and a total of $2.5 billion raised. Managing Director Michael Seibel stated that Y Combinator is working to increase the racial diversity of the startups it guides, and that “it is also important once funded, to help underrepresented founders get attention.”

Precursor Ventures is an early-stage venture capital firm focused on pre-seed and seed investments in B2B and B2C software applications and hardware. The firm has made over 200 diversity investments to date, making it one of the top firms investing in diverse teams.

Managing Partner and Founder Charles Hudson told Crunchbase that he has made a conscious decision to maintain a single channel for the pipeline at Precursor, instead of a side program or special access program for female founders or founders of color.

“I believe that if our core funnel and process can’t produce a sufficient number of companies led by women and people of color, we should fix the core process instead of creating some alternative pathway for women or people of color to get evaluated and considered,” Hudson said. “[M]any of the very best founders I meet aren’t looking for special treatment or some alternative path to pitch — they want a main pathway at the fund that treats them fairly and puts them in the same lane as everyone else. They believe they can compete and win if they are evaluated fairly in that main channel.”

ZeroTo510 is an entrepreneurial accelerator program focusing on medical devices. According to Crunchbase data, the Memphis, Tennessee-based firm has made 20 diversity investments to date, which is a majority of the total investments they’ve made. 

ZeroTo510’s program was designed to create a medical device innovation industry in Memphis, and its founder recruitment focuses on diversity to include female entrepreneurs and entrepreneurs of color.

Reach Capital supports entrepreneurs who develop technology solutions for challenges across early childhood, K-12, higher education and workforce reskilling and upskilling. The San Francisco-based firm has made 61 diversity investments to date, including an investment last year in Black-founded company Empower3d.

Reach Capital believes that investing in diverse founders makes business sense. They looked at their own portfolio and found that “companies with diverse founding teams perform better than those with only white male founders. Companies with diverse founding teams represent 64% of our cost basis but 80% of value in our portfolio.”

Base Ventures invests in seed-stage technology companies. The Berkeley, California-based firm has made 37 diversity investments to date. In addition to having a diverse portfolio and team (including Black founders Erik Moore and Kirby Harris), Base Ventures also strives for diversity in its LPs, of which more than 10% are Black women.

Impact America Fund makes early-stage investments in tech-driven businesses that create new frameworks of ownership and opportunity within marginalized communities. The Oakland, California-based fund has made 25 diversity investments to date, including investments in Black-founded CareAcademy, MindRight Health and Esusu Financial last year. 

As stated on its website, Impact America Fund’s approach to investing is to “bridge the financial and cultural divides that have kept low- and moderate-income people of color on the sidelines of the modern economy.”

TechSquare Labs is an incubator, seed fund and co-working space. The Atlanta-based firm has made 12 diversity investments to date, and its Black-founded portfolio companies include Career Karma, Carbice and Storj. Co-founder Paul Judge is a serial entrepreneur and managing partner at Panoramic Ventures.

Former partner Rodney Sampson spoke about how TechSquare Labs didn’t have to explicitly mandate diversity for its entrepreneurs, funders and mentors. 

“We do not have the biases present in many investors about the ability of African Americans (or Latinos, or women) to be viable technical co-founders; nor do we have doubts about the ability of African Americans to invest in startups or venture funds,” he said. 

DivInc is a nonprofit accelerator that holds 12-week programs for underrepresented tech founders. The Austin, Texas-based firm continually presents the annual Champions of Change Awards, which recognizes and celebrates local individuals who champion diversity, equity and inclusion in the Austin ecosystem. Last year, DivInc announced a partnership with Blavity to kick off a series of educational events during AfroTech 2022 geared towards people of color and women entrepreneurs.

Digitalundivided leverages its data, programs and advocacy to catalyze economic growth for Latina and Black women entrepreneurs and innovators. The Atlanta-based nonprofit was one of the first to debut authoritative research on the state of Latina and Black women founders with its #ProjectDiane Report. Recently, the nonprofit announced its new Interim CEO and Chief Operating Officer Brittany S. Hale.

Rough Draft Ventures, powered by General Catalyst, is a student-led team that funds technology-focused university entrepreneurs. The Cambridge, Massachusetts.-based firm has made 44 diversity investments to date, including Black-founded companies Topicals, ShelfLife and Twelve

DiverseCity Ventures backs scalable, technology-enabled companies that have positive social, economic or environmental impact and inclusive teams. As stated on its website, the Sheridan, Wyoming-based firm engages in “thought leadership and policy advocacy in pursuit of triple-bottom-line results. People, profits and planet multiplied by DCV’s edge is our formula for alpha.”

Founding Partner and Managing Director Mariah Lichtenstern also leads the Tech Funding Equity project, which aims to close the early-stage funding gap for underrepresented tech startup founders. The project puts forward ideas that the LPs who invest in VCs funds and the regulators who constrain capital formation are also part of a systemic problem. DiverseCity Ventures is calling on the SEC to amend the accredited investor definition, and for institutional investors to take an “Opportunity Pledge” to create opportunities for diverse, emerging managers to establish investment track records.

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  • Originally published February 20, 2023, updated February 21, 2023