Black Tech Entrepreneurs Struggle To Find Funding in Britain. Now They’re Looking Abroad
Black tech entrepreneurs in the United Kingdom are not shying away from speaking about the difficulties of getting funding from investors. Now they say they have to rely on foreign investors to get their businesses off the ground.
When I first heard that this was happening – I wasn’t entirely shocked because this conversation had been long brewing for many years now.
Between 2009 and 2019, only 0.24% of all venture capital available to UK startups went to just 38 Black founders, according to Extend Ventures, a non-profit that tracks the investment barriers minority businesses face.
Comparable data for 2020 has not yet been released.
But it wasn’t a great year overall for UK startups trying to raise funds, with venture capital firms investing a record £11.3 billion ($15 billion), according to recent research by Tech Nation, a UK public-private body that helps British technology companies grow.
“It’s a mixed bag,” Izzy Obeng, managing director of Foundervine, a social enterprise that helps underrepresented entrepreneurs who want to set up a business, told CNN.
Speaking to the broadcaster, she said: “The challenge is that there are a lot of performative gestures, but not enough investors looking into the data on investment in Black-owned startups, and also at the funds being created by Black fund managers and the amount going to diverse founders,” she adds.
Some entrepreneurs like Benedict Odoom, the founder of an agritech startup called Kilimo IOT, have told the broadcaster that they have given up on venture capital and are self-funding their businesses through side projects or family and friends while hoping for the appearance of an angel investor —a wealthy individual or family that backs small businesses with early-stage funding.
US firms and, more recently Japanese, venture capital directed at ethnic and social minorities across Europe is helping some Black British tech entrepreneurs.
In October 2020, Google (GOOGL) Ventures brought its Black Founders Fund to Europe. It’s a$2 million version of the US accelerator it launched following the protests sparked by the killing of George Floyd in May 2020.
The European program selected 12 startups from 800 applicants, offering them $330,000 (£249,527) each in cash and Google Ad grants and credit to use on the Google Cloud Platform.
