Will the Real Venture Capitalists Please Stand Up?

Black Canadian Women in Tech are Significantly Underfunded. Let’s Change That.

By Amoye Henry

The fight for gender diversity in the business tech industry is an ongoing battle. The voices of Black Canadian women entrepreneurs remain virtually unheard. After overcoming systemic barriers to setting up businesses and conquering the emotional hardships faced by entrepreneurs in general, the struggle continues. Black Canadian women still have to face the disheartening fact that they are far less likely to be funded than other demographic groups in their respective industries.

Out of the billions of dollars raised in venture capital funding each year in the United States, less than 0.5% goes to women of colour and African descent. While Caucasian-male owned tech start-ups often raise millions to take their ideas to the next level, in 2018 the average amount of funding received by the few African American women who qualified, was approximately $36,000. The statistics are likely similar in Canada, though no data as available. Even I, as a Black woman founder, have no idea exactly how many Black woman-owned businesses exist in Canada today. The data is nowhere to be found; the research does not exist.  

I have worked with hundreds of Black woman-owned business owners, especially in the tech industry, and discovered that many of the aspects that make these start-ups unattractive to corporate investors can easily be fixed with education and applicational frameworks. I co-founded PitchBetter, a market research solutions firm that is dedicated to empowering women entrepreneurs. Our programs are designed to improve and enhance existing business models in preparation for scaling, growth, and investment. 

Yes, this all sounds amazing, but surprisingly, the battle is still not over. Even when a Black Canadian woman founder has gone through the process of restructuring her business plan to make it more appealing to investors, we still face being overlooked simply because we cannot be found. Our businesses are not featured or highlighted on several platforms, and we struggle just to get opportunities to pitch for funding. Even when the Canadian government implemented the initiative to bridge the funding gap by allocating a series of grants to 300 women-owned businesses, only two of those businesses were founded by Black women. If social inclusion and diversity of thought is what it takes to move the economy – and the tech industry – forward, why is it that the brilliant minds of many Black Canadian women founders are being overlooked?

It’s quite interesting to note that U.S.-based start-up Bird, an app for electric scooter rentals, received more funding in their last round than all American Black women who received venture funding in 2019. The numbers are even more dismal in the Canadian landscape. Canadian investment firms and venture capitalists who have publicly spoken out against anti-Black racism are failing to adjust their lens on diversity and inclusion by paying attention to the institutional racism they take part in in Canada. A recent Bloomberg article pointed out that the Canadian Venture Capital and Private Equity Association’s study concluded that just 6% of professionals holding senior roles at participating VC firms identified as a visible minority—that’s just eight of 145 partners.

Recently Andreesen Horowitz, a well respected VC entity based in the U.S., announced its Talent x Opportunity Fund to support “underserved” founders, while SoftBank similarly announced a $100 million Opportunity Growth Fund, focused on founders of color. Where is the Canadian Private Equity and Venture Capital community response to this for Black Canadian founders?

This is why our new research study, FoundHERS is crucial to the survival and development of black-female businesses, which will ultimately enhance the Canadian economy too. We need active engagement, mentorship, partnership, and funding to build a more inclusive ecosystem that has representation. FoundHERS seeks to identify and profile Black-female owned businesses across the nation, and create a dashboard for strategic partners to review viable investment opportunities in the Black community.

If you, or anyone in your network, believe that social inclusion is the best way to move our tech industry forward, let’s connect and build something meaningful.

Amoye Henry is an entrepreneur and small business consultant on a mission to help scale growth-based businesses led by unique founders. She is the co-founder of Pitch Better, a startup that trains entrepreneurs to build and scale sustainable small businesses. She is currently completing her Executive MBA at Ivey Business School, on track to graduate in June 2021.