Why Are There So Few Black Investors?

Today, some of the world’s most respected and successful figures are in the tech industry. They include the entrepreneurs who have developed innovative products and launched industry-changing companies and the venture capitalists who provide money and assistance to help these companies thrive.

But while the technology sector continues to flourish, and its luminaries are seen as role models, the industry as a whole is suffering from a lack of diversity that has undermined its ability to fully realize its transformative potential.

African-Americans Are Under-Represented In The Good Ol’ Boys Club

The venture capital industry in the US (and thus, in turn, Silicon Valley) is made up of nearly all white males.

In fact, the National Venture Capital Association (NVCA), the trade group for the industry, has recently acknowledged the lack of diversity in the industry and has recently formed a task force to help tackle the problem.

However, even the task force lacks diversity, with 7 of its 11 members being white males and none of the remaining four members being a person of color. Furthermore, diversity stats at a number of technology companies reveal that the situation among the industry’s top players is not much better. Roughly 2% of the employees at Google, Facebook, Pinterest, LinkedIn and Yahoo are black.


In my quest to determine the true diversity statistics within the venture capital industry, I conducted a study of over 200 firms composed of roughly 2,000 investors, investigating the current number of black investors working in venture capital in the United States.

I included only full-time investment team members, so I did not include Entrepreneurs In Residence (EIR’s), Venture Partners, accelerators, or incubators. The results demonstrated that the diversity stats are eerily similar, if not worse, than that of the aforementioned tech companies. African-Americans comprise only 1.5% of investment team members at these firms. You can find the data that I have pulled together here — Venture Capital Diversity Stats.

To dive a bit deeper, many of the more visible funds and, by extension, visible investors tend to be those at venture funds with a fund size of $100M+. The stats look even bleaker here with less than 1% of investors being African-American, and only one of which is a woman.

Since we love discussing unicorns in the tech world, it is clear that female African-American venture investors are the “real” unicorns. In light of this data, I’m hopeful that there are additional African-Americans in the venture community that were not captured in my study, however, this wish may be inconsequential, as it is clear that there are nonetheless far too few.

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