Editor’s note: This article is the first in a three-part series on the state of venture investment to Black-founded startups in 2026. Driving these reports is data from Crunchbase’s Diversity Spotlight feature, which offers insight into diversity in startups’ and investment firms’ leadership teams. Parts 2 and 3 in this series will be published in June.
The share of U.S. venture funding going to companies with Black founders in 2025 remained low, even as overall startup investment ticked slightly higher, Crunchbase data shows.
Only around $942 million — or just 0.32% of total U.S. venture funding — went to startups with a Black founder or co-founder last year, per Crunchbase data. That’s one of the lowest shares in years, and down more than two-thirds from just three years prior.
This year has started off on a slightly rosier note, with $643 million raised by U.S.-based startups with a Black founder or co-founder as of May 20. The majority of that was raised in the first quarter, marking the most raised in a single quarter since Q2 2022, when $653 million was raised by a Black founder or co-founder.
It’s important to note that the relatively robust quarter was in large part due to an outsized round — a February $350 million Series E raise by Palo Alto, California-based SambaNova. Co-founded in 2017 by chief technologist Kunle Olukotun, the AI chip startup has raised a total of $1.5 billion in known funding. Cambium Capital Partners and Vista Equity Partners co-led its latest raise.
As such, it’s not surprising that the $643 million raised so far this year was secured across just 34 deals, signaling larger deal sizes overall.
It’s important to note that the total funding raised by startups with a Black founder or co-founder so far this year is still a small percentage of the $252 billion raised by U.S.-based startups in 2026.
Last year’s total also represents a sharp decline from the record venture funding year of 2021, when investment in Black startup founders hit a high of $5.2 billion in the wake of the 2020 racial justice movement. Still, even during the peak year, investment in Black founders represented just 1.5% of U.S. venture funding, per Crunchbase data.
Henri Pierre-Jacques, managing partner at Harlem Capital said the decline in venture funding to Black entrepreneurs coincides with a marked shift in the political environment. “There are fewer conversations on the topic as many are afraid to speak on it directly, which is concerning,” he told Crunchbase News via email.
Overall, Pierre-Jacques believes venture capital is about finding outliers. “That isn’t going to change for any group,” he said. “I focus on what we can do as a firm and then advocate for underserved founders.“
Notable rounds
Similar to 2025, much of the funding tally for Black-founded startups in 2026 came from a few larger rounds. Standouts include:
- SambaNova, the AI hardware and software company mentioned above. It specializes in providing infrastructure for AI and machine learning applications. Notably, tech giant Intel reportedly increased its stake in SambaNova to 8.2% following its investment in the Series E round.
- Novig, a New York sweepstakes-based sports prediction market, picked up $75 million in a February Series B round led by Pantera Capital at a $500 million post-money valuation. The platform has users participate in peer-to-peer wagering on sporting events.
- San Francisco-based Harper, which is building an AI-native insurance brokerage for SMBs, also raised in February, a $47 million Series A led by Emergence Capital. It is an alumnus of the prestigious startup accelerator Y Combinator.
- Live events platform Posh in March raised a $37 million Series B led by FirstMark.
- GovDash, which sells AI-driven government contracting software, raised $30 million in a January Series B round co-led by BCI and Mucker Capital.
Relationships and networking
Investors and founders who spoke with Crunchbase News on the topic said that in the current AI-centric funding environment, relationships and networking have only become more important for startup founders, particularly Black and other historically overlooked entrepreneurs.
“In an age of AI, who you know matters more than ever,” Pierre-Jacques said. “There are fewer deals getting done by firms and partners. You have to build personal relationships in order to make it to the top of the stack. It isn’t just about KPI comparisons.”
Joah Spearman is a two-time startup founder currently raising capital for his fintech startup, TenYour. He agrees with Pierre-Jacques on the importance of Black founders widening their networks as much as possible.
Spearman urged younger or Black founders who are building and raising for the first time to gain as much insight and inside knowledge as possible from other founders.
“This can save significant headaches, time and limited resources, especially during the early stages,” he said. “Black people in America have defined, and continue to shape, what it means to be in community, and I’m thankful to play a small role in that ecosystem.”
Having worked at Bazaarvoice, an Austin analytics software company, Spearman said that he built a network over time that included exited founders whom he was able to turn to as “adviser-investors.”
“These advisers can write checks, make intros and think like operators, which is sometimes better than seeking advice from VCs who haven’t been operators during the zero-to-one stages,” he said. He also recommends that new founders, particularly those in focused sectors such as fintech or insurance tech, consider attending industry-specific conferences like Money 20/20 or ITC to make connections with VCs “months and sometimes years before you’re ready to raise.”
Spearman also said Black founders should be open to sources of funding other than traditional venture capital, particularly when first starting out. Many are steered toward accelerators at the early stages, he noted.
“I don’t think this is bad counsel,” he told Crunchbase News via email, “especially if it involves an accelerator like the one Northwestern Mutual offers annually.” TenYour participated in that accelerator in 2025, which resulted in both an investment and industry connections, he said.
Looking forward, not back
The startup funding landscape has drastically changed in the span of just five years. In 2021, the aftermath of the COVID pandemic, a heated 2020 presidential election, and the high-profile killings of Black Americans including George Floyd, Breonna Taylor and Ahmaud Arbery spurred many of the largest startup investors to make high-profile pledges to back more Black and other underrepresented founders.
Now, “we are so far from 2020, not only in the pledges made but also in the social and venture landscape,” Spearman said.
Still, “rather than looking back,” he said, “I’d recommend we collectively continue to push forward to envision and co-create the world we want. For founders, that often starts with their ventures and the choice to solve a meaningful problem that other founders (and investors) may overlook.”
Tanvi Lal, co-founder of VC Unleashed and an investor with Intuit Ventures, is frustrated that funding to Black-founded startups relative to overall venture investment funding has fallen in the past few years. That’s especially disheartening, she said, given research indicating that Black Americans are more active consumers of AI tools than the general population, with a reported 53% using such tools daily or weekly, versus 39% of people overall.
“To me, this shows early signals that the investment cycle creating wealth from AI is not flowing back to the communities using AI the most,” she said.
In 2021, Lal and Michelle Dhansinghani started VC Unleashed, a nonprofit, to increase access to the venture capital world for both founders and aspiring investors. While the organization is open to all, Lal said, Unleashed uses its platform “to uplift underrepresented founders as much as we can to help them access capital and build their network,” including through its upcoming Shift VC conference.
When asked if she could change one structural aspect about how venture capital operates to improve outcomes for Black founders, Lal said it would be moving the conversation upstream from general partners at VC firms to those firms’ limited partners.
“GPs deploy capital that LPs give them, and if a pension fund or endowment isn’t asking its VC managers about founder portfolio composition with the same rigor it applies to sector concentration or stage exposure, that absence gets transmitted all the way down to the founder level,” she wrote via email. “Questions on founder demographics, asked consistently and at scale, would do more to shift behavior than anything else.”
Related Crunchbase queries:
Related reading:
Methodology
The data contained in this report comes directly from Crunchbase, and is based on reported data provided by our Diversity Spotlight partners, venture partners, our community network and news sources. The data in this report is focused on the U.S. market for underrepresented minorities, namely Black-/African-American-founded companies.
Crunchbase’s dataset is constantly expanding, but there are gaps. A company may not have founders listed, or the Diversity Spotlight data may not be updated on its Crunchbase profile.
We do believe we are missing companies, especially at the early stages of funding.
If you notice missing data, please reach out to spotlight@crunchbase.com or verify with your company email to update your company’s Diversity Spotlight tags directly onsite.
Crunchbase, like all databases of private-market transactions, experiences some reporting delays. The data for 2025 and 2026 will increase over time relative to previous years. As data is added to Crunchbase over time, some of the numbers in this report may shift.
Illustration: Dom Guzman
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