In 2023, Black-founded U.S. startups captured less than 0.5% of the $140.4 billion in venture funding, a stark decline from previous years, according to Crunchbase News. Funding to Black-founded startups plummeted 71% in 2023, even as overall venture dollars decreased by 37%. An 86% plunge from the 2021 total of $4.9 billion signals a profound and concerning shift in the venture capital landscape.
Even as the number of Black and Latino-founded companies securing $1 million or more in funding slowly expands, the decline unfolds. Yet, the total venture capital allocated to Black-founded startups has fallen precipitously, creating a widening chasm between initial access and the crucial growth capital needed, especially as AI's impact on startup funding in 2026 intensifies.
Without targeted intervention and a fundamental overhaul of investment strategies, the venture capital gap for Black-founded startups will only widen further, actively stifling innovation and economic opportunity across the entire startup ecosystem. For more, see our Venture capital investment surges across.
A Persistent and Deepening Disparity
- The share of U.S. venture funding going to companies with Black founders in 2025 remained low, totaling $942 million or 0.32% of all U.S. venture funding, according to Crunchbase News.
- As of May 20, 2026, U.S.-based startups with a Black founder or co-founder had raised $643 million, with the majority of that capital secured in the first quarter, reports Bloomberg.
- In 2021, Black-founded startups received 1.4% of all U.S. venture funding, a share that dropped to 1.1% in 2022, Crunchbase News further indicates.
- In 2023, venture funding to Black-founded U.S. startups plummeted to $705 million, a stark contrast to the higher percentages seen in prior years and a clear marker of the accelerating decline.
Consistently dismal percentages across multiple years confirm the issue transcends temporary market fluctuations. It exposes a deeply entrenched structural problem within venture capital, where Black entrepreneurs confront sustained barriers to equitable funding.
