Black Founders Matter presses VCs to pledge commitment to diversity

Image Credits: Marceau Michel

He always asked for a quarter when he was a kid.

One day, he would have a dollar if he asked for a quarter. He would be on his way to having two by the time he was done.

The mentality has stayed the same at the helm of the Black Founders Matter venture fund. The 25 by 25 pledge encourages venture capitalists to invest 25% of their funds into female entrepreneurs by the year 2025. The increase in diversity behind the scenes is believed to help pivot more deal flow into marginalized communities.

The power dynamics in venture capital need to be changed. You have to start at the people who are left behind.

He was inspired to start the pledge after he realized his investments leaned towards Black male founders. He focused on investing in black women and added five companies to his portfolio. He wants to encourage VCs to invest with diversity in mind in order to improve the industry.

Minority women get less venture capital funding than white women. The $330 billion in venture capital was raised by women last year. Less than half of the 2% went to Black women, less than half went to Latinas, and less than half went to Asian women.

“If a fund does not want to do this pledge … the question is why.” Marceau Michel, founder of Black Founders Matter

If more funds said they only wanted to see deals led by women, then more women would be invested in. Most of the women on Earth are women of color. It is not too much to ask for 25%. I just think it's the beginning.

If you want to sign the pledge, you can do so on the website.

The impact of a pledge

The 15 percent pledge was launched by fashion designer Aurora James.

Retailers are encouraged to dedicate at least 15% of their shelf space to Black owned businesses. It has gotten commitments from 28 retailers. A database of 1,200 Black companies was created by the pledge. According to the 15 Percent Pledge, it has helped Black-owned businesses generate $10 billion in revenue and has the potential to bring in over $1 trillion in wealth for black entrepreneurs by the year 2030.