Following the racial justice movement last year, there was an uptick in venture capital deals for minority women founders, but has that support been sustained? This New Jersey-based nonprofit has the facts to show that it hasn’t.
Founded in 2012, digitalundivided is a nonprofit organization that offers community and resources to Black and Latinx women entrepreneurs. The nonprofit recently released the first update on its ProjectDiane report, a demographic study that details Black and Latinx women founders and the startups they lead.
The nonprofit began working on its biennial ProjectDiane report in 2016, with the most recent report publishing last year. The ProjectDiane 2021 Update assesses data from the fourth quarter of 2020 and the first quarter of 2021. Digitalundivided debuted the most recent findings at its undivided We Rise virtual summit last month.
“Studies show that Covid-19 alone has sped up digital transformation by 5.3 years,” digitalundivided CEO Lauren Maillian said during the summit. “In reaction to this, we have shifted and will now provide more frequent updates and reports of our findings including quarterly white papers, insights and investigative, responsive research reports.”
Maillian took over as CEO of digitalundivided in June 2020 after serving as chair of the organization’s board of directors. She’s a serial entrepreneur, investor, marketer, and brand strategist, so she brings a wealth of experience to this role as she’s working to lead the nonprofit through a pivotal time following the pandemic.
“We did somewhat update our mission a couple of years ago to say that we want to create a world where all women own their work,” Maillian said. “I always add on to that statement and say because it is the only way we can have women own their net worth. Our net worth is always tied to our jobs, careers, and however, we earn incomes.”
When it comes to the ProjectDiane report, Maillian told AfroTech that the nonprofit mainly looks to track who is and who isn’t, funding Black and Latinx women founders. The report’s database now includes 800 Black and Latinx women-founded companies, and as of March 2021, they have raised more than $4 billion in venture capital combined.
“We were always examining the funder/founder landscape. That has always been what ProjectDiane was about,” Maillian told AfroTech in a phone interview. “It always intended to be this massive call to action and awareness around Black and Latinx women’s ability to succeed in innovation and technology.”
Maillian said one of the most significant findings in the report is that 27 new Black and Latinx women founders have raised over $1 million since the last update. She also pointed out that while Black and Latinx women-founded companies brought in $953 million in venture capital in Q1 of this year, $657 million went to three unicorn companies. Savage X Fenty raised a $115 million Series B, BlockFi raised a $350 million Series D, and Cityclock Health raised a $192 million Series C.
Even with these few wins, there is still much work in the venture capital world since Black, and Latinx women founders only received 0.43% of total investments in 2020. The average amount per deal that each Black and Latinx woman founder receives is decreasing, Maillian said.
“I’m really focused on changing the mainstream’s perception of women of color,” she said. “Our work is important, but it’s not enough. I want the conversation around supporting women of color as entrepreneurs and founders to become the mainstream conversation.”
Some other high-level findings from the report include:
- The majority of Black women founders live in California (105) and New York (96).
- The majority of Latinx women founders also live in California (97) and New York (42).
- Black and Latinx women founders received $715 million out of the $166 billion in venture capital distributed last year.
- Businesses in healthcare, business products and services, and financial services secured the most funding in 2020.
Another interesting finding that Maillian pointed out is that most Black women founders launch their companies solo, while Latinx women founders have a partner. Why is that? Digitalundivided is hoping to examine this further in future ProjectDiane updates.
For more insights from the report, click here to purchase and download the ProjectDiane 2021 update.