াম Venture capitalist Noramay Cadena, managing partner at Reuters Supply Change Capital, is pictured in this unspecified handout. Handout via Alisha Tova / Reuters
By Jane Lanhi Lee
Oakland, Calif. (Reuters) – Four venture capital funds founded by women of color in the United States said Monday they were merging under an umbrella called The Ally Capital Collab to get an edge in fundraising and investing.
According to The All Capital Collaborative, 22 funds and WOC Star Fund have black female founders, while Supply Change Capital and 2045 Venture have Latin founders.
Protests of racial injustice last year have led to more diversification in the venture capital world, but startups run by people of color are unrepresented.
According to data firm Crunchbase, in the first nine months of 2021, Black- and Latino-based startups invested more than billion 1 trillion, down from an average of billion 1 trillion in the previous six years.
This represents about 3.2% of funding for all U.S. startups.
Gayle Jennings-O’Byrne of New York said, “There are a lot of investors who are basically with us, but have never had access to us.
He said creating an organization like The Ally Capital Collaborative to work together for funding makes it possible to properly support each other and give investors confidence, as many minority venture capitalists lack the Silicon Valley network to raise funds.
Representatives of the four funds will speak at an event at the Milken Institute in California on Monday.
Last year, the industry group National Venture Capital Association launched an arm called Venture Forward to try to address the lack of diversity.
“If we can help investors move the needle on diversity … it’s naturally going to change the make-up of the founders,” said Maryam Haque, executive director of Venture Forward. He said his recent survey indicates that there has been very little progress so far in the development of racial or ethnic diversity at the partner level.
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