14 Black and Latinx Emerging Fund Managers To Know (& Fund)

The “Pipeline” is Blocked At The Top —

With the recent uprising against systemic racism in our governmental institutions and society, there has been an increased focus on the on the lack of funding for underrepresented founders. Only 1% of VC funded startup founders are Black, Latinas have received .04% of VC funding, women of color can expect an average of $42k seed funding vs. the average seed funding of $1m, the list of stats goes on.

Yet the problem is far deeper than startup founder-level stats. It exists at the other side of the table —just 3% of VCs are Black and 2% are Latinx. The diversity issue radiates all up the capital stack at the General Partner (GP) level. As the system is currently set up, we’re banking on a trickle-down effect from VCs in ivory towers to invest in underrepresented founders when we should also be intently focused on changing those doing the funding.

As Recast Capital recently reminded us, respected Limited Partners (LPs) like the Kauffman Foundation and consultants like Cambridge Associates have long reported that emerging managers and smaller funds tend to outperform larger scale, established funds, yet many traditional LPs will only allocate capital to brand-name VC firms and stay away from emerging firms given the…