The uptick in the portion of startup investment going to female-founded companies — up from 15% in 2022 — was in large part due to a number of billion-dollar-plus rounds raised by AI companies with a female co-founder.

For example, OpenAI raised the largest funding deal in 2023, at $10 billion, and foundation model company Anthropic raised more than $6.5 billion across four funding rounds that year.  Both companies count women among their founders.

Within the AI sector in particular in 2023, more than 50% of U.S. investment went to AI companies with at least one female founder, in total around $21 billion, across more than 360 rounds.

But that was driven by several large fundings that skewed the numbers. The majority of funded AI startups in the U.S. did not have a female founder — just under 20% of funding rounds in AI that year went to companies with a female founder, per Crunchbase data.

Still, OpenAI and Anthropic were not the only AI companies with a female co-founder to receive significant funding deals. Several other unicorn companies — private startups valued at $1 billion or more — have female founders and joined The Crunchbase Unicorn Board in 2023. They include Adept AI, Replit and Imbue, among others.

While female startup founders have by no means reached parity when it comes to venture dollars for their companies, the ground has slowly shifted in a more positive direction, with more women in the startup ecosystem than ever.

“While high-profile, substantial investments in female-led AI startups are encouraging, they can create a perception that progress is faster than it actually is,” said Rudina Seseri, founder and managing partner at AI-focused early-stage investment firm Glasswing Ventures, via email.

“It is important to support female founders early to ensure a balanced and sustained increase across all funding stages,” she added.

A decade and counting

Crunchbase added gender information to its dataset in 2015, becoming the first database with private company and venture funding data to do so. Since then, we have been tracking funding to female founders.

Over that time frame, the venture ecosystem has seen massive change — led by the pandemic  growth surge and a subsequent slowdown in the second half of 2022.

Through the years when venture funding exploded, and with the massive increase specifically to late-stage startups, the proportion of funding to companies with a female-founder did not fall.

Above $30 billion since 2021

Although female startup founders in the U.S. saw a notable uptick in the percentage of venture dollars their companies received in 2023, last year was not the largest annual dollar amount invested in female co-founded companies, per Crunchbase data.

In 2021, close to $48 billion was invested — marking 14% of U.S. venture capital to companies with a female co-founder. That year saw healthcare and biotech as the leading sector, with $20 billion invested in companies with a female founder.

During the peak venture funding market of 2021 and strong first half of 2022, funding to companies with a female founder held up, tracking at 14% and 15% of invested capital, respectively, within a percent or above preceding year proportions since 2015.

Female-only flat

Funding amounts to female-only founded companies grew and contracted with the market changes in recent years. But the proportion of funding was flat year over year, at 3% of funding amounts. This proportion has fluctuated between 2% and 3% since 2015.

Funding amount proportions to female/male co-founded companies ranged between 9% and 12% from 2015 to 2022, but jumped in 2023.

While proportions were within a narrow range prior to 2023, the amount and count have increased over the years as venture capital grew.

Funding counts higher

Funding count proportions are typically higher than amounts invested in female-founded companies.

(This trend was reversed in 2023 with funding counts 4 percentage points lower as female/male co-founded AI companies raised disproportionate amounts.)

In 2023, female-only founded companies represented 8% of deal counts — flat year over year — while female/male co-founded companies were down from the 2021 peak by a couple of percentage points at 14% of deals.

Since 2016, overall funding counts to companies with at least one female founder ranged from 19% to 24%, with 2019 through 2022 at or above 23%.

By stage

How do we account for a greater proportion of rounds than amounts to companies with a female founder?

Companies with a female founder represent a higher proportion at seed and early-stage fundings. Late-stage funding counts show a lower proportion.

However, since 2015, late-stage deal proportions have shown the largest growth span over this time frame as seed and early-stage deals mature to later-stage companies.

Late-stage deal counts trended up in 2023, at 16% of deals compared to 14% a year earlier. As female-founded companies mature, it will be interesting to see if this upward trend continues.

In conclusion

While progress on funding for female startup founders has been slow and still hasn’t reached anything close to parity, 2023 offered new hope that women-founded startups will continue to see gains, particularly as new tech waves like AI come along.

Women have founded some of the most significant companies in the new wave of generative AI. In recent years, AI companies have raised some of the largest funding rounds and have reached billion-dollar values at a faster pace than seen in other sectors.

Time will tell if the AI wave — and the gains for female founders it has helped bring about — last, or if 2023 will prove to be an outlier. In the meantime, it’s encouraging to see female startup founders take a leading role in building one of the most transformative technologies of our time.

Methodology

The data contained in this report comes directly from Crunchbase, and is based on reported data. Data reported is as of May 29, 2024.

Our analysis is based on announced funding to U.S. companies with founders associated. We include private company fundings from seed through late-stage venture as well as corporate funding and private equity to venture-backed companies.

Crunchbase’s dataset is constantly expanding, but there are gaps. A company may not have founders listed on its Crunchbase profile, or Crunchbase might not have a gender listed for founders. (Note: In addition to “male” and “female,” Crunchbase has more than two dozen other gender tags.) Based on an analysis of current data for this report, more than 95% of dollars raised and 90% of deal counts since 2015 in the U.S. are associated with companies that have founders listed.

Crunchbase, like all databases of private-market transactions, has a documented pattern of reporting delays. It can sometimes take between weeks and months for some rounds to be announced publicly and subsequently added to Crunchbase. This is especially the case for the most recent year, and for seed and early-stage deals, which are often raised by companies before they launch a product or otherwise get much outside media coverage surfacing information about its funding history. As data is added to Crunchbase over time, some of the numbers in this report may shift slightly.

Illustration: Dom Guzman

As companies expand, they often face increased risks due to over-dependence on limited customers, geographic markets, supply chains and more.

Strategic diversification is not just a prudent choice; it’s a vital maneuver to safeguard your business from unpredictable setbacks.

With that in mind, here’s how to strategically mitigate risks associated with key areas of diversification.

Customer concentration

Over-reliance on a handful of customers can spell disaster if one decides to part ways. Diversifying your customer base helps stabilize revenue streams and reduce the volatility of your business performance.

Implementing a robust customer acquisition strategy that leads to customer diversification — where there is no small group of customers contributing to the majority of sales, and where your customer base is a healthy mix of market segments or industries — can cushion the company against the loss of a major client and market volatility.

I have seen companies lose significant M&A value due to customer churn as that one customer accounted for 50% of their revenue.

Expanding geographic reach

Concentrating on a single country or region increases vulnerability to local economic downturns, political unrest or regulatory changes. Companies should look to international markets for expansion — not just to increase their customer base but also to mitigate risks tied to any one locale.

This geographic diversification can be achieved through online platforms, setting up remote sales offices, or partnerships with international distributors.

Securing multiple supply chains

Sole reliance on one supplier for raw materials or key components can lead to significant operational disruptions if that supplier faces issues like price hikes, production halts or goes out of business.

To avoid this, companies should develop relationships with multiple suppliers across different regions. This approach not only helps in negotiating better terms but also ensures continuity of supply.

I have seen companies lose three or four quarters of revenue due to such issues. This can destroy a company. By the time you sort things out, even your loyal customer base may be long gone.

Considering ‘what if’

There are many diversification strategies to think about, including product or service diversification.

Every entrepreneur should take a step back and play a game of “what if.”

What if your biggest customer churns? What if your key supplier vanishes? What if there is a natural disaster or political unrest in your key geography? What if your key technology is now offered as a free feature by a major player?

If you work to mitigate these risks, you will cushion yourself from volatility and lay the foundation for sustained growth.

Itay Sagie, a strategic adviser to tech companies and investors, specializing in strategy, growth and M&A, a guest contributor to Crunchbase News, and a seasoned lecturer. You can connect with him on LinkedIn for further insights and discussions.

Illustration: Dom Guzman

Despite repeated commitments to “do better,” venture capital continues to be dogged by poor diversity and inclusion: Black investors make up an estimated 4% of venture capitalists in the U.S., and in Europe, women only represent 15% of general partners.

Studies show that people hire and back those who remind them of themselves. This “affinity bias” creates a vicious cycle. With a stark lack of diversity among VCs, is it any surprise that all-male, all-white teams remain vastly more likely to attract funding?

To add insult to injury, VCs are unwittingly fueling this status quo through “knowledge gatekeeping” — holding information and power close to their chests. This is preventing people with overlooked and underestimated backgrounds from accessing VC careers, thereby cementing the inequalities we see around who receives funding.

Extensive jargon

VC knowledge gatekeeping takes many forms. One of the biggest is jargon. “Carry,” “secondaries,” “LPs,” “bridging” — for someone new to the startup world, it’s overwhelming.

And yet very little is done to boost access to VC education. We don’t teach it in schools, nor routinely at the undergraduate level. This creates an intimidating barrier for those looking to break in. The result? The VC talent pipeline is stacked by people who have organic access to knowledge gained through parents, peers or attendance at certain institutions.

When my organization, the Newton Venture Program, launched our free ‘Foundations’ program earlier this year, more than 1,000 people signed up in a month. There is strong demand for entry-level resources; we simply need more people willing to create them.

Exclusive spaces

Another form of gatekeeping is the exclusivity of the networks and communities across VC.

Reminiscent of high school parties, lots of deal-making and knowledge-sharing happens in invite-only spaces (digital and IRL), or between industry peers with existing relationships.

This cross-firm collaboration is an integral part of VC, but it can also operate to the detriment of aspiring investors. (See also: Investors’ over-reliance on the warm intro and its impact on founder diversity.)

For those who don’t have an existing network, it’s tough to break into what can feel like a clique. And it’s those from overlooked and underestimated backgrounds who lose out. If existing members of the VC club fail to pull up aspiring recruits and invite them to the proverbial party, we will never truly diversify the industry.

Rigid resumés

Venture is a tough industry to crack. There are a limited number of funds, most with small teams, and competition is fierce. But VCs’ overreliance on resumé hallmarks are hurting diversity and excluding exciting talent.

According to one analysis, 42% of adverts for VC internships mention engineering degrees and 20% mention computer science — both male-dominated subjects. Likewise, the research showed firms expect candidates to have 0.5 to 1.11 years of experience to qualify for internship roles. This is a major barrier to entry for candidates who don’t have the connections needed to secure experience (and likely can’t afford to work for free).

By continuing to rely on rigid resumé requirements, insider mentalities and jargon-laden lexicon, VCs are gatekeeping access to the industry and unwittingly locking-in the cycle of poor diversity.

These aren’t hard problems to solve. However, fixing them requires honesty and action on the part of existing VCs and LPs. That means addressing these inequalities by investing in educational and community access programs, embracing anonymized, skills-based hiring, and ensuring teams are consciously looking to create pathways to success for those aspiring to roles in the industry.

By doing this, VCs can ditch the role of gatekeeper and instead embrace a new position as custodians of a fairer, more inclusive venture capital industry.

Eleanor Kaye is the executive director of Newton Venture Program, a joint venture between LocalGlobe VC and London Business School to diversify venture capital. Newton provides access to education and training to people from overlooked and underestimated backgrounds looking to access or accelerate careers in the industry.

Illustration: Dom Guzman

Twenty years ago, the landscape of angel investing bore scant traces of female presence, with women representing a mere 5% of all angel investors and 3% of funded companies. Fast-forward to 2022, and the scenario has transformed dramatically, with women now accounting for 40% of angel investors and 31% of angel-funded companies.

This shift is not just a numeric increase; it’s a seismic evolution reflecting broader changes in society and the business world.

Our own journey started in 2004 with Golden Seeds, a national angel network that invests exclusively in early-stage companies led by women.

We were met with much skepticism. Yet, our conviction was fueled by two undeniable trends: the burgeoning number of women-led businesses, and the growing capital, skills and networks of women to invest in startups.

Since then, the idea of investing in women-led businesses has gained substantial traction. Golden Seeds’ investments of more than $180 million in nearly 250 companies — which have in total raised an additional $2 billion — stand as a testament to the economic and social impact of women entrepreneurs and investors.

However, declaring success is premature. Despite the progress in seed investing, there is still a major disconnect between the innovation women are leading and the pace at which venture capital is realizing these opportunities.

How is it possible that women can lead half of the new businesses in the U.S. and still more than 80% of VC-funded deals in 2023 went to all-male teams? It’s equal parts baffling and frustrating.

Reflecting on our experiences, including both successes and challenges, we’ve identified meaningful ways the venture capital community can join us in our mission to direct additional capital and other forms of support to women-led startups.

Insights for the venture ecosystem

First, the compelling impact of women’s leadership on company performance cannot be overstated. Research consistently shows that gender-diverse teams and companies led by women outperform their peers financially. Last year, McKinsey reported that companies with gender-diverse executive teams are 39% more likely to achieve financial outperformance.

Similarly, BlackRock found that companies led by women CEOs have almost consistently outperformed those led by men over the past decade. The Impact Group and BCG further solidify this evidence, showing that gender-balanced boardrooms are nearly 20% more likely to improve business outcomes, and businesses founded by women deliver 2.5x higher revenue per dollar invested than those founded by all men.

This data isn’t just numbers — it’s a clear indication that diversity is a strategic advantage.

Second, the venture capital world has often relied on pattern recognition — investing in entrepreneurs who fit a familiar mold, often favoring serial entrepreneurs with a track record of successful exits. This methodology, while comfortable, has led to missed opportunities and overlooked innovation. The bias has inadvertently sidelined some of the most promising ideas, particularly those developed by women and minorities.

Third, the venture ecosystem has traditionally been concentrated on the coasts, overlooking the rich diversity and potential of startups nationwide. In 2022, 44% of funded angel deals occurred outside the traditional VC hubs, indicating a significant pool of untapped potential across the country.

Lastly, the inclusion of more women in decision-making roles within VC firms can drastically alter funding dynamics. Research from Babson College’s Diana Project indicates that when a VC firm includes at least one woman partner, the likelihood of a woman entrepreneur being funded increases by 2x to 3x. Yet, women constitute less than 20% of decision-makers in U.S. VC firms, underscoring a critical area for improvement.

Toward a more inclusive future

After two decades of pioneering investment in women-led startups, we stand at a crossroads where investing in women is not just an emerging trend but a mature movement. Today, with robust data and the cumulative wisdom of years, the impact of women as entrepreneurs and investors is undeniable. Yet, the venture community’s evolution toward gender equity and inclusivity is still ongoing.

To build a better venture ecosystem, what’s needed is not just recognition of past successes but an unwavering commitment to open new pathways for diverse entrepreneurs to access necessary funding and support.

The future of venture capital, infused with the insights and leadership of women, promises not just better outcomes for women entrepreneurs but unparalleled economic growth and innovation for all.

Loretta McCarthy is co-CEO and managing partner of Golden Seeds, an investment organization that invests in women-led startups. At Golden Seeds, she manages the national network of nearly 300 members and has been a frequent speaker domestically and internationally about early-stage investing and women entrepreneurs. Previously, she served as executive vice president and chief marketing officer at OppenheimerFunds and was an executive at the American Express Co. 

Jo Ann Corkran is co-CEO and managing partner of Golden Seeds, where she manages the deal flow and post-investment processes. She is also a general partner of three Golden Seeds venture funds that invest in early-stage companies with gender-diverse management teams.  Previously, Corkran was managing director at Credit Suisse Asset Management, Credit Suisse, and First Boston. She currently serves on the board of directors for Work Truck Solutions, a commercial vehicle inventory and marketing solutions company, and EliseAI, a machine-learning company that uses conversational AI to transform housing and healthcare. 

Illustration: Dom Guzman

Moonshots Capital‘s Kelly Perdew and Craig Cummings successfully transitioned from military careers to venture capital. Perdew won “The Apprentice,” working for Donald Trump, while Cummings earned a Bronze Star as an NSA intelligence officer, becoming a highly influential military veteran entrepreneur. They attribute their success to the discipline and principles gained from their Army officer training. Their stories illustrate the untapped potential of military veterans in the VC industry.

Veterans bring a wealth of skills and expertise to the VC ecosystem. Their distinct training, abilities and experiences are invaluable in evaluating many startups seeking capital. Often, veterans gain firsthand exposure to cutting-edge technologies during their service, arming them with unique insights into emerging trends.

Yet, the journey from military veteran to venture capitalist isn’t without obstacles. Veterans grapple with limited access to pipeline programs designed for underrepresented groups.

Other hurdles include difficulty networking with traditional investors unfamiliar with their military experience and fundraising challenges for veteran-led venture capital firms.

Many veterans, unacquainted with the corporate sector, need help establishing networks for raising funds from conventional sources like institutional investors.

Getting started

Several initiatives, some of which my organization VetsInTech is part of, aim to bridge this chasm, creating a smoother transition from military service to the VC arena. Initiatives that provide veteran-focused boot camps, tailored mentorship programs and high-value networking opportunities are helping fill this gap.

The Nasdaq’s Entrepreneurial Center and its Venture Equity Project is a multiyear coalition of academic and nonprofit partners. The initiative focuses on understanding and tackling inequity in venture capital, providing stakeholder-facing practices, and offering policy recommendations to remove barriers. The Venture Equity Project seeks to increase the flow of capital to entrepreneurs and investors of color.

The Diversity Data Coalition is a collective of several nonprofit groups that include All Raise, BLCK VC, Diversity VC, SomosVC, 2Gether-International and StartOut. The coalition was formed to address the need for more diverse perspectives and limited representation of marginalized groups in the historically homogeneous VC industry.

Its main objective is to create a comprehensive, intersectional database of founders and funders in the VC community. The database will provide insights into funding trends and advocate for equitable access to capital allocation for underrepresented founders. Military veterans, many of whom are minorities and have disabilities, can specifically benefit from this initiative.

More resources

J.P. Morgan‘s Project Spark initially pledged $25 million for the veteran VC community to close the funding gap for underrepresented managers and strengthen the veteran ecosystem in the alternatives industry. Project Spark aims to lead the industry in creating access to venture capital for the veteran community. Veterans can benefit with access to resources essential for success in VC firms, including conferences such as VetVC Summit, investor meetings and insider events.

The SBA offers an advantageous program for veteran-owned small businesses called VetCert. The VA sets aside at least 7% of its annual contracts specifically for veteran-certified small businesses (VOSB) and service-disabled, veteran-owned small businesses (SDVOSBs). VOSBs and SDVOSBs can pursue these valuable sole-source and set-aside contracts under the VA’s Vets First program.

Some military veteran VCs have already left significant footprints in the industry. Besides O’Connor, Raj Shah of Shield Capital was a successful serial entrepreneur before becoming a VC focused on the defense industry. Matt Shortal, a decorated ex-fighter pilot flying F-14s, is now chief of staff at Andreessen Horowitz, one of Silicon Valley’s top VC firms.

Military veteran VCs enrich the VC ecosystem with their skills, experiences and perspectives. Investing in veteran-led firms not only honors their service but also makes sound business sense, leading to a greater diversity of thought and more successful investments.

Ikram Mansori serves as the COO of VetsInTech, a nonprofit dedicated to advancing career opportunities for veterans and military spouses in the tech industry. Her career began in the 82nd Airborne Division and included service in Iraq and Afghanistan, before she transitioned from military service to a focus on technology and entrepreneurship. Previously, Mansori was appointed by San Francisco Mayor London Breed as the city’s veterans affairs commissioner, charged with tackling local and national veterans’ issues. In her role as VetsInTech COO, she spearheads the organization’s daily operations and oversees key initiatives such as the VetsInTech Startup Network, VetsInTech Venture Capital and Women VetsInTech Program.

Illustration: Dom Guzman

Clarification: This story has changed since its original publication.

Today’s social divisions are as palpable as ever, and on the receiving end are often people from marginalized communities, immigrants and refugees.

As investors, we know many founders who have recently arrived to the U.S. from countries suffering humanitarian crises, or whose teams are stuck in war zones. The challenges they face in everyday life — let alone finding success as an entrepreneur — are unimaginable to many.

VCs have disproportionate power in determining the fate of founders, and in times like these we should be using that power to create a community that’s bigger than a firm, company or capital.

Investors should use their privileged position to create strong communities and accompany isolated and underrepresented entrepreneurs through personal and professional challenges. This is how any VC can create more community for the benefit of founders, and themselves.

Create inclusiveness

Entrepreneurs entering, or considering entering, the startup world are often disillusioned by its exclusiveness.

VCs could be opening doors to those with historically less access to entrepreneurship by setting up an accelerator for marginalized communities, or running a training program with a local college. For example, VC firm Laconia has a Venture Cooperative aimed at increasing access to the investing community, and thus entrepreneurship.

At One Way Ventures, we also started a collective of successful entrepreneurs to support immigrant early-stage founders, who often face unique barriers to fundraising.

All you need is a willing community of people ready to offer their unique expertise and support for a larger goal. You don’t need to spend obscene amounts of money, just share knowledge and introductions with those who could most benefit.

Put your machinery to work for others

VCs should favor a partnership mindset where resources can be shared within their ecosystem and portfolio. This can offer significant accompaniment to entrepreneurs who come from an unfamiliar environment.

VCs have an array of services at their disposal that can easily be deployed to service startups. If your firm uses PR services, you can negotiate a deal with your agency to spend some of their time with your portfolio to increase their media-savviness and reach.

Other VCs are launching free products for startups to support the community with more accessible growth services. We’ve also been sharing the services of our graphic design agency with our portfolio — with the added benefit that the agency has a team in Ukraine.

Unite experts with shared experiences

Another step VCs can take is to unite people within a structured community — whether that’s a collective, community, safe space or association. Reach out to successful entrepreneurs, academics, stakeholders and other VCs who share your values and have something new to offer founders.

You should be looking to recruit people who reflect the experience and identity of the founders you’re trying to support, while also having a track record of success. For entrepreneurs, being able to lean on a group of people who are not expecting anything in return, and whose interest in you is purely to help from a place of shared hardship or ambition, can instill founders with a sense of optimism. We’ve found that it’s also rewarding for participants themselves. This is why you can’t create a collective based on quid pro quo, but rather on the very desire for community.

These initiatives may take time, but ideally they will grow organically. Of course, it would be naive to think that none of this community-building comes back in your favor, but this should be a bonus to the more widespread potential of your actions.

Semyon Dukach is founding partner of One Way Ventures, a VC firm funding exceptional immigrant founders. A Ukrainian-American, he came to the U.S. as a child refugee in 1979. He is the former managing director of Techstars (Boston), and an angel investor in over 100 companies.

Illustration: Dom Guzman

Per Crunchbase data, just seven U.S. companies with female founders joined the unicorn club in 2023 and 2024. That’s a precipitous decline from the peak year of 2021, when dozens of female-founded American companies met or exceeded the $1 billion level for the first time, amid a global boom for the category.

Who’s joining the unicorn board

The most recent female-founded addition to the unicorn board is Redwood City, California-based Zum, provider of a student transportation platform used by school districts across the country. The 9-year-old company picked up $140 million in a Series E round in January at a $1.3 billion valuation.

Led by co-founder and CEO Ritu Narayan, Zum tries to help school districts increase efficiencies and reduce the costs of managing bus fleets through its AI-enabled platform. The technology gives districts visibility so they can optimize routes and even deliver real-time updates to parents.

Others include:

• Imbue, a startup that trains foundational models to develop AI agents, landed $200 million in a September Series B round at a valuation of more than $1 billion. The 3-year-old, San Francisco-based company’s co-founder and CEO is Kanjun Qiu.
• Green hydrogen company Ohmium secured $250 million a year ago at a unicorn valuation in a Series C led by TPG Rise Climate. The 5-year-old company, which lists its chief compliance officer, Kirsten Burpee, as a co-founder, designs and manufactures proton exchange membrane electrolyzer systems, which are used to split water through electrolysis to create hydrogen.
• Los Angeles-based Metropolis, a provider of checkout-free parking, raised $1.05 billion in an October Series C, along with $650 million of debt financing. One of its co-founders is Courtney Fukuda, currently serving as chief integration officer.
• San Francisco-based Replit, a developer platform that uses AI to complete code, has raised $222 million in known funding at a valuation of at least $1.2 billion. The 8-year-old company lists Haya Odeh as co-founder and VP of design.
• Adept AI, founded in 2022, has raised $415 million to date at a last reported valuation of at least $1 billion. One of the company’s co-founders is Niki Parmar, who also served as CTO. Parmar is also co-founder of Essential AI, founded last year, which came out of stealth with $56.5 million in funding in December.
• New York-based fertility clinic network Kindbody raised $100 million led by Perceptive Advisors. The company, which plans to expand its clinic footprint, was valued at $1.8 billion. Its founders are Gina Bartasi and Joanne Schneider.

Yes, there’s a lot of AI

Looking at the list above, it’s clear artificial intelligence is a popular core or enabling technology among new, female-founded unicorns.

This isn’t entirely surprising, given that AI is a common theme among all global unicorns minted over the past year. As of late October, 1 in 5 of the new billion-dollar startups to join The Crunchbase Unicorn Board in 2023 were artificial intelligence companies, an analysis of the board shows.

Notably, however, AI is even more highly represented among new female-founded unicorns. Of the seven listed above, three – Adept AI, Replit and Imbue — are essentially pure-play AI technology startups. Two more — Metropolis and Zum — list AI as an enabling technology.

Given the small size of the sample set, it may be wise to avoid drawing too many inferences from the high representation of AI on the list. Clearly, however, it’s safe to say that female founders and executives are playing a leading role in the space. This is evidenced not just by new unicorns but also by more established startups such as Anthropic, which has raised more than $10.3 billion to date with Daniela Amodei taking a lead role as co-founder and president.

More unicorns ahead?

Given the slow pace of creation for new female-founded unicorns in recent quarters, it’s also reasonable to both hope and expect the numbers will improve. After all, last year was a comparatively weak period for venture funding overall.

The contraction was most pronounced for the kinds of large, later-stage rounds that most frequently come with unicorn valuations. As a result, we’re seeing a drop in unicorn creation across the board. Given the cyclical nature of startup investment, it should eventually be due for a pickup.

Illustration: Dom Guzman

The femtech category, dedicated to innovative solutions tailored to women’s health, is at an inflection point. But while this realm brims with potential, it presents complicated dynamics that startups must navigate.

In particular, two major challenges block big outcomes in the space.

Willingness to pay

The landscape of femtech presents a paradox. Although women are diagnosed on average much later than men, and are uniquely and disproportionately impacted by a wide range of indications, historically these disparities haven’t cost the healthcare system much (although a recent McKinsey report points to a trillion-dollar gap/opportunity).

As a result, there is generally low willingness to pay by insurance companies and low total addressable markets for new solutions addressing women specifically.

The result: Women bear the burden of the information gap highlighted above by paying more out of pocket on average and going outside the traditional healthcare system to address their health. This has in part given way to a $5.6 trillion wellness industry (with women representing 80% of consumer spending) — not far from the $7.7 trillion global healthcare industry.

More data is needed to reveal the business case for better women’s healthcare. There are ample efforts underway on this front that will play a pivotal role in unlocking capital.

The massive information gap

Female biology is more complex to study given its cyclical nature and its precious creative potential. While a 1977 ban on including women of childbearing age in clinical trials was lifted in 1993, underrepresentation persists and female patient recruitment is challenging.

More and better women’s health data is a prerequisite to creating a better “foundation model” of female biology. With a better basis of understanding of sex-based differences in disease, industry can unlock high-value, personalized therapies for females.

Placing greater emphasis on understanding the specifics of female biology comparatively has the potential to unveil insights into the mysteries of aging, the brain, and the immune system, all of which manifest differently in women.

The recent $100 million ARPA-H “Sprint for Women’s Health Research” program has the potential to play a major role in addressing this issue. In addition, startups have an opportunity to generate quality data that can be leveraged to advance the field.

Women are fired up about advancing biomedical research for women and are willing to participate by sharing their data. Building consumer trust with high integrity and navigating data privacy is critical.

Venture-backable femtech companies will likely come in two flavors

Platforms that reimagine healthcare or biotech for females: There is opportunity for deep-tech-enabled healthcare offerings (virtual or physical clinics) designed to understand and treat females more personally by embracing the diversity and complexity of biology. They will approach standard of care through an integrative lens, draw in cutting-edge research — which can take years to integrate into medical practice — and may pull in nontraditional wellness therapies.

On the biotech side, there is opportunity for companies to interrogate the mysteries of female biology with better models to discover and develop new therapeutics. Most preclinical research is conducted on mice which don’t model female biology accurately (e.g., they do not go through menopause). With advances in genetic sequencing, machine learning and lab-grown human tissue modeling, industry can better understand  female biology.

Beachhead product + data: There is an opportunity for rigorous, research-driven companies to launch a single product to serve an unmet need unambiguously while simultaneously building valuable proprietary datasets.

A nonhealthcare example: Insights around online purchasing data didn’t exist before Amazon. After nailing its initial, narrow product-market fit (selling books online), the company leveraged its position to become a $2 trillion company. To do this effectively, the initial product must propose a clear, obvious value proposition with a meaningful enough advantage over the status quo.

Asking females to pay for something that’s incrementally better than something they’re getting for free or have already tried is not going to cut it. There is a massive consumer base ready to be delighted with quality femtech, but establishing a true value proposition that will drive adoption and engagement (i.e. willingness to pay) can’t be taken for granted.

Whether device, digital therapy or diagnostic, there is opportunity for companies that can resonate with females around an initial product-market fit.

We disagree with the premise that femtech isn’t getting funding because of a lack of female investors. Investors will chase deals with large markets and potential outcomes. There is curiosity and eagerness from generalist VCs to find the companies that will redefine care for women.

Today’s femtech companies are true pioneers, and will have to address challenging industry dynamics. We believe the companies that are able to do so will not only attract venture capital, but will pave the way for many more data-driven products, therapies, and services for females, inspiring new levels of physical well-being at every stage of life.

Ari Wright is a principal investor at Bison Ventures, where she leverages her interdisciplinary background to focus on biotech and climate. Previously, she spent five years at Braemar Energy Ventures, an early pioneer in climate and sustainability venture capital. She also spent three years at Global Holdings Management Group, where she led hospitality real estate acquisitions and development, helping to build out the firm’s international hotel platform Lore Group. Wright has a bachelor’s degree in biomedical engineering from Brown University, a master’s degree in engineering green technology from the University of Southern California, and an MBA from Harvard Business School.

Illustration: Dom Guzman

Clarification: This story has changed since its original publication.

Executive summary

Our fifth annual study, which characterizes the boards of the most heavily funded private companies in the U.S., reveals significant improvement in board diversity over the past five years.

It also points to independent board seats as the critical lever for change when it comes to increasing cognitive diversity in the boardroom, expanding networks, and, as suggested by our latest data, even boosting funding.

Within this study, we look at gender diversity, which is reasonably measurable, as a proxy for diversity of perspectives, life experience, areas of expertise, and other demographics. In a world in which boards composed exclusively of men have been the rule rather than the exception, the presence of women in the boardroom — particularly in an independent director role — may be an indication of those boards’ intention to add diversity and of their efforts to seek talent outside their immediate networks.

Our 2023 study indicates that women now hold 17% of board seats — up from 7% in our inaugural 2019 study. Over the same period, the number of boards without any women fell significantly, from 60% to 32%. Women of color now hold 5% of board seats, up from 3% in 2020, the first year for which this metric was available.

Women who serve on boards are most likely to be independent directors, as opposed to investor or executive directors. Women hold 29% of independent board seats, compared with 13% of investor seats and 10% of executive seats. While nearly every private company board includes executive and investor directors, nearly 20% of the companies in the study haven’t appointed even one independent director.

Notably, when companies have only one independent director and that director is a woman, they raise an average of 16% more capital than when that independent director is a man.

The greatest gains in independent directors — and, consequently, in gender diversity on boards — occurred between 2019 and 2021. The rate of change then dropped notably in 2022 and 2023. This timing tracks with two trends in the broader capital markets that influence recruitment of new directors.

• As the IPO market softened, urgency to build public-ready boards diminished.
  In the year or more leading up to a public offering, companies typically revisit board composition to meet SEC requirements, adding an audit chair and other independent directors. IPOs peaked in 2021 and fell dramatically in the two years following. As a result, fewer companies needed to prepare their boards for imminent public offerings.
• With limited access to private funding, CEO attention turned to profitability versus board-building. At the same time that the horizon for IPOs moved out, companies had a harder time raising additional private capital. According to an analysis of Crunchbase data, 2023 was the lowest year for U.S. venture funding since 2018. CEOs without adequate cash runways focused on the operational challenges of accelerating revenue growth and cutting expenses, rather than the strategic opportunity to build out their boards.

Concurrent with these market conditions, advocates for corporate board diversity — including State Street, Blackrock, Vanguard, Goldman Sachs, Nasdaq and some state legislatures — began to face opposition as ESG and broader DEI initiatives became politicized. The effect, if any, of these new headwinds is less clear than the stifling effects of the capital markets in 2022 and 2023.

In fact, our most recent study points to hopeful trends on private company boards:

• Younger companies are more likely to have women directors.
  Among companies founded since 2015, 20% of board members are women, compared with 16% for companies founded before 2016. Additionally, only 22% of the newer companies have all-male boards, whereas 37% of the older companies don’t have any women in the boardroom.
• More women investors are taking board seats.
  The historic lack of gender diversity among funders has a downstream effect on private company boards where investors hold nearly half of the seats. Encouragingly, the percentage of investor-directors who are women increased from 5% in 2019 to 13% in our latest study.
• Fewer women are boardroom “Only’s.”
  Our study indicates that 30% of directors are the lone woman on their boards, down from 44% in 2020. This supports the notion that one of the key benefits of board diversity is expanding the board network to access new talent.

Adding independent directors provides private company boards with the opportunity to tap critical expertise, bring in new perspectives, and expand the reach of their networks. While companies have been slower to take advantage of this lever in the last two years, continued progress even in the midst of challenging capital markets suggests that boards recognize the long-term value of cognitive diversity.

Why this study?

When it comes to boardroom trends, numerous studies track public company boards, but high-growth private company boards have been largely overlooked. We launched our inaugural study in 2019 to fill this information gap.

Board diversity is important for public companies, but it’s also important for private companies.

Private companies surpass public companies in number, employ millions of people, and drive innovation. They are the public companies of the future. In fact, nearly half of the public companies founded since 1979 began as venture-backed startups. Yet years before they hit the public markets, private companies create the products and services and define the business models that will shape society for decades to come — a critical time period for cognitive diversity in corporate governance and oversight.

The composition and challenges for private company boards differ significantly from those of public company boards and therefore warrant special attention. Determining the mix of executive, investor and independent directors — and trends related to those types of board seats — is essential to understanding private company boards and is therefore a key focus of our research.

This 2023 study includes our largest sample to date:

• 735 U.S.-based private companies which have raised at least $100 million
• 4,992 board seats
• 4,321 individual board members

These boards govern companies which employ nearly 300,000 people and have raised $224 billion in investment.

Key findings

• Women hold 17% of board seats among the companies studied, up from 7% in our original study in 2019.
• Between 2019 and 2023, women gained two-thirds of a board seat (0.67); they now represent roughly 1.2 out of 6.8 board members.
• Nearly a third (32%) of companies don’t have any women on their boards, an improvement from 60% in 2019.
• 5% of all directors are women of color, up from 3% in 2020.
• 25% of company boards include a woman of color, up from 19% in 2020.
• Women hold 29% of independent director seats, 13% of investor director seats, and 10% of executive director seats.
• Companies with a woman as their first and only independent director have raised 16% more funding than those whose first and only independent director is a man.
• 30% of directors are the only women on their boards, down from 44% in 2020.
• Life sciences companies continue to outperform technology companies on all board-diversity metrics.

The percentage of women directors more than doubled since our inaugural study

Within the average private company board of 6.8 members, women hold 1.2 seats. This represents a significant gain from 2019 when women held just 0.5 seats but only a slight improvement from the 1.1 seats we reported last year. Women now make up 17% of the directors within high-growth private companies. By comparison, within public companies, women hold 33% of board seats among S&P 500 companies and 29% of board seats among the Russell 3000.

Over the span of our research, the prevalence of all-male boards has declined from 60% in 2019 to 32% in our latest study. Among public companies, all S&P 500 boards have included women directors since 2020.

Within our study, the 238 private companies governed by all-male boards represent more than $60 billion in cumulative funding and employ more than 86,000 people.

Research suggests that boards need at least three women directors to capture the full economic benefits of diversity, yet only 32% of boards have more than one, and just 12% have more than two. However, our study indicates that the percentage of board members who are the only woman in the boardroom has dropped to 30% from 44% in 2020. Notably the boardroom gains for women over the last year appear to have been driven by adding additional women to boards rather than introducing the first woman director to all-male boards.

The percent of women of color continues to rise

Women of color now hold 5% of the 4,992 board seats we studied. That’s an improvement from 3% in 2020, when directors named “Dave” outnumbered women of color in the boardroom.

An estimated 19% of private company board seats are held by men of color. Roughly two-thirds (64%) of the boards studied have at least one man of color on the board, while a quarter (25%) include a woman of color. The number of men of color (778) who are board directors exceeds the total number of women directors, regardless of race or ethnicity (760).

Though still the majority in the boardroom, investors hold fewer seats

Investor directors hold just under half (46%) of seats on the boards we studied, down significantly from 56% in our inaugural 2019 study. During that period, the average board size has remained essentially flat at just under seven members. The mix has shifted toward independent directors, who now hold 31% of board seats, up from 20% in 2019.

Private company board directors can be classified in three groups: executive directors, investor directors and independent directors. Executive directors include CEOs, co-founders and any other members of the company’s management team who hold board seats. These make up 23% of the board seats within the companies studied, consistent with our findings in prior years.

As private companies raise venture capital, investors often take seats on the board. Within the study data, investor directors have consistently made up the largest pool of board members, though the average number of investor seats per board has declined from 3.8 in 2019 to 3.1.

Independent directors are typically the last to be added to the board, as they are neither tied to the company’s founding management team nor early investors. Private companies are not required to have independent directors; however, public companies must have at least one independent director, depending on the size of the board.

The average number of independent directors on the boards studied has grown to 2.1 from 1.4 in 2019, offsetting the decrease in investor directors over that time. Despite this growth, 18% of these heavily funded private companies don’t have any independent directors on their board.

Independent director appointments drive boardroom gains for women

To some extent, the lack of gender diversity on private company boards is a downstream effect resulting from the lack of gender diversity among venture investors and the entrepreneurs they choose to fund, with the percentage of women in associate board seats roughly matching estimates of the percentage of woman check-writers and venture-backed founders. Thus, the increases we’ve observed in women-held executive and investor seats over the past five years — from 4% and 5%, respectively, to 10% and 13% — likely reflect the efforts of investment firms to be more inclusive in recruiting and funding talent.

Because investor and executive director seats are usually tied to funding dynamics, independent board seats often provide the most immediate opportunity to introduce more cognitive diversity into the boardroom. Women now hold 29% of independent director seats, up from 19% in 2019. These independent board appointments have been responsible for more than half (54%) of the board seats gained by women over the past five years.

Companies with a woman independent director have raised more money

Publicly available financial data for privately held companies is scant. Therefore, identifying associations between board composition and business performance is virtually impossible. However, one objective basis for comparison is the amount of cumulative funding raised by companies in our data.

Perhaps not surprisingly, companies with at least one independent director average 26% more in cumulative funding than those without an independent. Considering that independent directors are almost always the last of the three types of directors to be added to the board, the fact that those with an independent are better capitalized stands to reason.

Companies with at least one woman director have raised an average of 29% more than those without any women in the boardroom. Again, this may be explained by the fact that women directors are most likely to hold independent seats and be later-stage additions to the board.

However, our data offers an interesting basis for comparison: the gender of the independent director among companies with only one independent. We found that companies in which the only independent director is a woman out-raised those in which the only independent director is a man by 16% (an average of $303 million compared with $260 million). Interestingly, recent research on public company boards concluded that those with women directors commanded a 5% higher acquisition price.

Although our data can’t draw conclusions about a causal relationship between fundraising and women independents, it does suggest companies that receive greater funding may be those which prioritize bringing more diversity onto the board.

Life sciences companies lead technology companies in board diversity

The 735 company boards included in our study spanned all industries, with 48% in life sciences fields, 39% in non-health-related technology industries, and the remaining 13% in energy and other areas. Across all measures of board diversity, life sciences companies out-perform technology companies.

Women hold 21% of board seats among life sciences companies compared with 13% among tech companies. They hold 3x as many executive director seats and twice as many investor seats on life sciences boards than on tech boards. While the percentage of women holding independent seats is the same for life sciences and technology companies, the former tend to have more independents per board.

Looking at the percentage of all-male boards by industry highlights this disparity. While 41% of technology company boards are all men, this drops to 25% for life sciences companies.

Given the disparity in diversity metrics by industries, it’s worth noting that the fundraising patterns described above hold true across both life sciences and technology companies. Also, while the mix of industries within our study data has shifted slightly over the past five years, that shift alone explains only a small fraction of the change we’ve observed in blended-board diversity measures over time.

Younger companies have more diverse boards

Within our study of boards founded since 2004, 39% got their start after 2015. These younger firms have a higher percentage of women directors (20%) compared with older firms (16%). They are also less likely to have men-only boards (22%) than firms founded before 2016 (37%). Much of this disparity is due to the fact that younger companies are more likely to have women investors on their boards. Within these companies 17% of investor director seats are held by women, compared with 10% for the older companies.

Summary

The five years of data we’ve now accumulated tracking private company boards have revealed steady, if not always swift, progress in shifting the bodies that govern these companies to incorporate a broader diversity of thought, perspective and life experience.

The appointment of independent board directors is the most expedient way to bring new talent into the boardroom, including not only demographic diversity but also operating experience, key competencies and relevant expertise. While market conditions have made board recruitment both less urgent due to longer IPO horizons and a lower priority due to cash constraints, hopeful trends suggest that progress will accelerate as macroeconomic conditions continue to improve.

Him For Her, a social impact venture, was created to reduce the friction for CEOs looking to build their boards and extend their networks by connecting them with outstanding candidates who bring expertise and perspectives critical to companies’ success.

Data in this study points to the good news that once boards include a critical mass of women and people of color, the challenge of board diversity can be solved in perpetuity as boards expand their access to new networks.

Methodology

This tracking update largely reproduced the methodology employed with our prior studies published in December 2019, March 2021, March 2022 and March 2023. For this update, we analyzed 735 of the most heavily funded private U.S.-based companies to understand the composition of their boards as of Q4 2023 — one year after the prior study and four years after the original.

Leveraging the Crunchbase database, we identified 2,848 U.S.-based private companies founded since 2003 with cumulative funding of at least $100 million as of June 30, 2023. To ensure that each company’s board profile was current, we included only companies that publish their board of directors on their website.

We then referenced company website data, Crunchbase profiles and other publicly available information to characterize the board members. The study included only board directors; board observers and/or advisers were excluded from the data set. For each company, we segmented board members according to type of board seat: executive, investor or independent. In the few cases in which founders and past executives remained on the board despite no longer having an operating role at the company, we classified them as “executive directors” in recognition of their original relationship to the company. We identified gender by referencing professional profiles on Crunchbase and, when not available, other sites. For racial/ethnic identity, we leveraged self-identification information where available and supplemented that with contextual information and visual identification. As reflected by U.S. Census Bureau data collection, people of color include Black or African American, American Indian or Alaska Native, Asian, Native Hawaiian or Other Pacific Islander, Hispanic or Latino. Those with MENA backgrounds are not included among people of color.

About the authors

Him For Her is a social impact venture aimed at accelerating diversity on corporate boards. To bridge the network gap responsible for the sparsity of women in the boardroom, Him For Her engages business luminaries and partners with 100+ leading private equity and venture capital firms to connect the world’s most talented “Hers” to board service. Drawing from its ever-growing referral-only talent network of 7000+ women, a third of whom are women of color, Him For Her introduces board-building companies to board-qualified candidates. More than one hundred board appointments have resulted directly from Him For Her introductions to date. Together with guest hosts like Scott Cook, Carmine Di Sibio, Robin Washington, and Eric Yuan, Him For Her also convenes roundtable discussions that extend networks for CEOs and current and aspiring board members. A 501c3 corporation, Him For Her operates through the generosity of its founding partners GV, IVP, L Catterton, Mayfield, Silver Lake Partners, SoftBank, Starboard Value and Tiger Global Impact Ventures, and supporters like Brad Feld & Amy Batchelor, Reid Hoffman, Jeff Weiner, Nasdaq and many others.

Crunchbase is the leading provider of private company prospecting and research solutions. Over 70 million users — including salespeople, entrepreneurs, investors and market researchers — use Crunchbase to prospect for new business opportunities. Companies all over the world rely on us to power their applications, making over 6 billion calls to our API each year. To learn more, visit about.crunchbase.com and follow us on Twitter @crunchbase.

Illustration: Dom Guzman

As venture funding to Black-founded U.S. startups plummeted last year, many areas that have in the past served as strong pillars for such investment saw serious declines in those numbers.

Overall, funding to Black-founded U.S. startups totaled only $705 million last year — marking the first time since 2016 that the figure failed to even reach $1 billion, Crunchbase data shows. Funding to Black-founded companies dropped 71% — greatly outpacing the overall decline in overall U.S. startup funding, which fell 37% last year, according to Crunchbase data.

However, certain geographic areas including Atlanta, Boston and the San Francisco Bay Area saw an even more severe decrease in funding to Black startup founders. That’s significant because those areas are not just some of the largest venture areas, but also historically some of the strongest for funding to minority founders.

Those geographic declines helped lead to the overall cratering Black-founded startup funding saw last year.

San Francisco Bay Area

When talking about venture numbers, it is hard to start anywhere but the biggest U.S. market of all: the San Francisco Bay Area.

Funding to Black-founded startups there plunged 78% in 2023, Crunchbase data shows. Only the Atlanta region saw a larger decrease — dropping 79% — but since the Bay Area is a bigger market in terms of dollars, the drop was more significant.

Black-founded startups in the Bay Area raised $198 million in 2023 — the lowest total since 2017, though that was still enough to make it the top region for such funding. Still, that number represents an immense drop from the $895 million raised in 2022 and a shocking crash from the $1.7 billion raised by Black-founded startups in the region in 2021.

What’s more is the share of the venture market Black founders are getting is shrinking. Last year, Bay Area startups overall raised a total of $57.3 billion. The $198 million raised by Black-founded startups mean such companies saw only 0.3% of all funding in the region.

In both 2022 and 2021, funding to Black-founded startups in the region made up 1.3% of the market.

The region did, however, get two of the three biggest fundings to Black-founded startups last year: Investment management platform Juniper Square raised a $133 million venture round led by Owl Rock Capital, and Clerkie, developer of an AI financial planning tool for underserved Americans, raised a $33 million Series A led by Left Lane Capital. Still, even the two larger deals could not save the area from realizing its massive dip.

Atlanta

The only metro region with a larger decline in funding to Black-founded startups than the San Francisco Bay Area last year was Atlanta. That’s especially significant given that the Atlanta area is viewed as a growing venture market that has long strongly supported minority-led companies.

However, last year the Atlanta metro area saw the smallest amount of funding go to its Black-founded startups since 2017. Only $23 million in venture spending went to such startups in the area — a staggering 79% decline from the $107 million invested in 2022 and even a wider gap from the $467 million raised in 2021.

The share of the venture market that Black founders in Atlanta received also diminished, though not as drastically as it did in the Bay Area.

In 2023, Atlanta startups overall raised a total of $1.3 billion, meaning Black-founded startups received 1.5% of the market — a slight drop from the 1.8% they saw in 2022. However, those numbers are a steep decline from the 8.9% those startups saw in 2021.

For all intents and purposes, there were no large growth rounds raised in the region last year. The largest round went to cleantech startup Cloverly, which brings carbon credits to digital applications, which raised a $19 million Series A.

Mark Buffington, co-founder of BIP Capital in Atlanta, said one dynamic that could be affecting the market is the networking needed to raise larger growth rounds — which are the main drivers in finding numbers. While Atlanta’s venture market has grown through the year, that can still be an issue — especially for Black founders.

“There are areas where there is more opportunity to build a network,” he said. “Geography can still matter.”

Boston

One region known for those large networks of venture capital is Boston. However, Beantown’s numbers also saw a substantial 72% decline in the amount of venture dollars going to Black-founded startups in 2023.

Last year, only $23 million dollars went to Black-founded startups in the region, compared to $120 million in 2022 and $150 million in 2021. One round alone represented nearly 83% of last year’s total — energy storage startup Fourth Power raised a $19 million Series A.

The scant 2023 total for Black-founded startups in the Boston area actually represented 2.6% of the region’s $13.5 billion venture market last year — which is the highest percentage share of any metro market.

However, it also represents a decline from the 5.9% share such startups received in 2022 and the 4.2% they got in 2021.

Anything else?

The Bay Area, Atlanta and Boston were not the only areas to see substantial declines.

The New York area — also one of the largest venture markets in the world — saw funding to Black-founded startups fall from $375 million in 2022 to only $185 million last year, a 51% drop.

Similarly, Los Angeles saw a 43% dip, falling from $301 million in 2022 to a scant $173 million last year.

Of course, these numbers do come at a time when geography is starting to matter less as remote and hybrid work remains the norm in tech and founders are getting more spread throughout the country.

Paul Judge, chairman of the Open Opportunity Fund, which is dedicated to supporting Black and Latinx founders, said that means it should be easier than ever for investors to find good companies, including those that are minority-led.

“It should be easier than ever to find these companies,” said Judge, who is based in Atlanta. “Investors are constantly looking for something other investors don’t know. This is something being overlooked.”

Methodology

Funding amounts and counts for the most recent year were collected through Feb. 23, 2024.

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, has a documented pattern of reporting delays. The data for 2023 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.

Related reading:

• Drop In Venture Funding To Black-Founded Startups Greatly Outpaces Market Decline
• Special Series: VC Dollars To Black Startup Founders Fell More Than 50% In 2022
• Special Series: Black-Founded Startups Raised Large Rounds, Added 3 Unicorns in 2022
• Special Series: Black-Founded Startups Attract Funding By Filling Gaps In Health Care Equity
• Funding To Black Startup Founders Quadrupled In Past Year, But Remains Elusive
• Black Women Still Receive Just A Tiny Fraction Of VC Funding Despite 5-Year High
• Culture, Colleges And Corporations Help Push Georgia To The Top In VC Funding To Black Founders
• Something Ventured: How Black Founders Can Increase Their Chances Of Raising Capital

Illustration: Dom Guzman