https://www.wired.com/2016/02/its-embarrassing-how-few-black-female-founders-get-funded/
As a black female founder I'm wondering if pursuing VC is worth the effort.
Do you think there are any easily identifiable reasons why the numbers are so low, or are these numbers actually proportional?
If your business is VC-friendly, and you want to go on the VC ride, then yes, you should go for it. Even if you don't get funded, or even if funding doesn't go the way you want it to, you will learn a lot of interesting stuff and make a lot of good connections. I went through the VC cycle 2x in the first dot-com boom and learned a tremendous amount from it. (Including a lot of skepticism about whether or not VC is a good path for founders - it is absolutely not the only good path.)
This article does a reasonable job of helping identify which companies might be VC-compatible and which aren't:
https://medium.com/point-nine-news/the-rise-of-non-vc-compat...
Even saying "the typical startup, typically founded by a white male, that typically fails." ... The reality is, upwards of 80% of all companies, not just startups, fail within the first year of operation, it's not a black vs white, male vs female issue. It's simply a combination of questions about the quality of the founders, the quality of the product, the quality of their marketing, the overall environment and a hundred other factors.
"... examined over 60,000 startups and identified just 88 led by black women... " and then go on to complain about how little money was raised from VCs without mentioning that 99.95% of all startups period, regardless of who is in charge, gets no VC funding https://www.forbes.com/sites/dileeprao/2013/07/22/why-99-95-...
So to answer your question, first replace the "as a black female founder" with just "as a founder ...". Focus on your product 100%, focus on improving it, focus on your users. That is the only thing you should be focusing on. And only after you have a good product vision (or ideally an already built product, even if just an MVP), only after you're seeing promising growth or at least plenty of interest in your key demographics, can you start thinking about VCs.
If I was to invest in any company, the only things I would look at is their numbers, their vision, and their skillsets. Ultimately the race, gender, orientation or any other such things, would never come into the equation.
I am curious, anything you could share about your business? Anything we could read?
Cheers
For example, compare it with the number of female polish founders who get funding. It's even lower!
But there are also a lot of factors left out. For example, geographic factors, how many startups receive funding in Poland?
I'm good at math, not everybody is.
If you looked at it mathematically, this subset (black female co founders) are actually very well funded.
It's funny that a high funding rate is paired with an article that is trying to use the percentage value for exactly the opposite position. Who ever writes this junk needs to take a statistics class ASAP.
Question: "As a black female founder I'm wondering if pursuing VC is worth the effort."
Answer: Absolutely. The numbers don't appear on first glance, but they are actually on your side!!
I don't think that means I owe anybody anything because of who I am, nor that I need to feel guilty anyway. But I would try to get beyond my own internalized biases when interacting with people.
From what I can sense about being other race or sex, if I were, I wouldn't want to apply for funding since I'd assume the game was rigged, mostly. I'd just try to go my own way. But that just me.
After applying to YC and funding a few times and failing, that's pretty much what I'm doing anyway.
If anyone is having trouble sensing the barriers of race and sex, you could try asking yourself, would I want to be another race and sex from what I am, to asses your own biases, and perceptions. That's what I did to realize I wouldn't want to swap it.
I'm not sure whether that bias actually exists, but lets assume that it does.
What this means is really just that you can't be Juicero. Do you want to be Juicero? Being biased against by VC only works against you if you want to be part of the VC lunacy. If you build a real company with actual value, your race won't matter. Maybe a little bit. Maybe even a lot. Maybe you don't get the inflated price some companies get, but raising money is not a competition. You just want to raise the money that you need, not top the Series A olympics.
If you don't view raising money as a competition, you will be fine. You are not a statistic. People make the mistake of viewing themselves as the outcome of a statistic. Statistics don't work that way. If one of those articles says that "only .4% of funded companies have black female founders", that does not imply that "of all the black female founders who apply, only .4% get funded". It just means that there are not many black female founders with VC funding. Could have any number of reasons.
Maybe one of those reasons is that black women have a hard time even getting into a position in life where they would consider trying to raise money. That is a big political and socioeconomic problem, but it is not YOUR problem. Just because there are not many of X, doesn't mean its hard for you to be X. Could be really easy. Do not get discouraged by statistics.
If you build a company that is worth investing in, someone will see it.
- To answer your question directly, if the numbers in the article are accurate, black women were disproportionately more funded per black female founder. The overall numbers are very low (i.e., relatively few black female founders overall), so I personally wouldn't draw any conclusions from this data since it is too easy to skew.
- Getting funding in general is hard. If a black female founder doesn't get funding, it probably has more to do with their idea or team than with anything else. Said another way, the same idea with founders of different race/sex will only very rarely change the outcome.
- Is it with the effort to pursue VC funding period (irrespective of being a black female)? Most ideas that people have simply don't scale to levels that will be interesting to VCs. Additionally, even if the idea has the potential to scale, it has to scale in the right way (i.e., on a VC timeline).
- I'm curious about why you believe anything in TC or Wired. They are in the business of selling clicks, and most businesses like this are quick and dirty with numbers and/or conclusions. I would weight these about zero in my decision about whether to pursue VC funding or not.
- Social capital goes a long way in VC funding. While there are certainly some people who will exclude because of a founder's blackness or womanness, there are many others who won't. I suggest getting close to some VC-funded founders somehow (social hack this). Private conversations with these folks will get you much more valuable and actionable information than a TC article or a post on HN.
- HN's (and Stripe's) own patio11 makes a point of being willing to meet young entrepreneurs to talk about these types of matters. This guy has well-informed opinions. Even if you disagree with some of his conclusions, you will at least have some great information to act on. Searching for patio11 and kalzumeus will point to a way to reach him.
- I suggest reading all of Paul Graham's essays. Short summary for founders: talk to your customers and iterate your product.
- I also suggest you read Michael O'Church's essays about VC culture on the way back machine. Sometimes they come off as being a bit shrill, but those essays provide a lot of valuable (and imho often accurate) insights about the dysfunction of certain parts of VC culture.
I hope this helps.