Silicon Valley VCs promised to help Black founders, but my experience shows a different reality.
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TechCrunch published Venture firms rush to find ways to support black founders and investors on June 2, 2020.
I was excited after reading this because I’m a Black woman and CEO of The Bright App, a fitness app startup I co-founded with my engineer husband. My company has been trying to raise funding since December and I thought: Finally, this time will be different. However, after weeks of trying to get in front of these same VCs making public statements of support for Black founders, I feel confused and dejected. This is my experience.
I immediately set out to contact the VCs mentioned in this article and began by searching for the contact information. This is where I hit my first barrier to entry. Most of these VC firms are totally unreachable.
Benchmark and Bessemer, two of these VC firms mentioned, don’t even have emails listed or contact forms on their websites to submit a pitch or deck to. Benchmark’s website lists only two physical addresses and a Twitter link that doesn’t work anymore.
Bessemer at least lists their partners on their website, but no emails — only links to Twitter and LinkedIn.
It seems that if you don’t already have a personal connection with someone at these firms, you’re automatically dismissed before ever getting started.
I’m a Black woman, mom of 3, and I don’t have an Ivy League degree. My lived experience is very different from a Silicon Valley VC. I don’t have connections in common with VCs. Does that mean I’m not even allowed in the door? Do they only fund people that look like them or went to the same schools? That’s a problem.
My husband, James Zhang, is the CTO of The Bright App and is an ex-Google engineer who happened to have a 2nd connection on LinkedIn to some of these VCs. I had to go through his LinkedIn account to contact these firms. If I wasn’t married to James and he didn’t have this connection via LinkedIn, there would have been absolutely no way for me to contact them.
After using my husband’s connections to scrape the internet for contact information, I sent our pitch deck from my own email and LinkedIn account to everyone in the TechCrunch article that I could.
In two weeks, I got zero responses, not even an automated one.
Recognizing that racism and sexism are both realities, especially in tech and VC spaces, I decided to try another tactic.
I began sending the exact same emails to the same people, but this time from my husband James’ email address.
For a bit more background on us, James and I not only co-founded The Bright App, but we also co-own two gyms in San Francisco and have worked together several times in the past — all facts that are readily apparent from the LinkedIn profiles linked in our email signatures. The other facts readily apparent from our LinkedIn profiles and pitch deck are that James is a light-skinned Asian man and I am a Black woman.
Curiously, when I used my husband’s email to send our pitch, that’s when I started getting some responses. Do VCs only read pitches submitted by men? I had the same experience four years ago in 2016 when I was raising funding for my previous startup. I got zero responses until I started using my co-founder Noah’s email. Despite much more public support for Black founders in 2020, it seems nothing has actually changed.
From 2009 to 2017, almost half a trillion dollars of venture capital was raised. Only 0.0006% of that was raised by Black women.
In 2017, only 34 black women were able to raise more than $1 million in funding for their startups in 2017. The average female founder, in general, was able to raise $5 million. Both stats lag far behind those of male founders, who raised an average of $12 million per round.
Source: Inc, Black Women Need More Access to Funding. Here’s Why
These numbers are certainly not because Black women don’t have the skills or drive as entrepreneurs. Black women started 42% of net new women-owned businesses between 2014 and 2019, which is 3x the average for all women-owned businesses. In 2016, Black women became the highest educated group in the US.
Unfortunately, none of this data on how Black women excel on a personal level matters if I have to be a man or have light skin even to get a worthwhile response from a VC. That’s a problem.
Still, I was glad to start getting responses, even though I had to use my husband’s face to get them. However, the responses were still rare and those who did respond were curt and unhelpful. Alfred Lin of Sequoia was one of these few. He replied within a day and asked for our pitch deck. After we sent him the deck, he replied with a short:
“Thanks for following up and sending me your deck. I took a look but I don’t see a fit with Sequoia at this time.”
I’m fine with that. I know our app may not appeal to every investor and we just need to find the right investor who understands the value we have to offer. I immediately replied back and asked for feedback and introductions. What I got instead was radio silence.
None of the VCs I contacted even tried downloading my app.
Black women are used to rejection and I’m no exception. If this was before COVID-19, I would be going to meetups and cornering investors in the hallways. In-person at least, I can try to divert their attention for 30 seconds and get some sort of feedback. There are many stories of Black women founders pounding the pavement until they found someone who would listen. The Great Pandemic has upended all that though. Now the best chance I have is to use my husband’s email and hope for a response. And it seems that even when I do get a response, I’m not going to get any constructive feedback or paths forward. That’s a problem.
The most in-depth interaction I had with any of the VCs I reached out to was with Ha Nguyen, who was extensively featured in the TechCrunch article.
Ha Nguyen, a partner at Spero Ventures, is hosting a Black founders breakfast and AMA lunch on Friday. Nguyen also offered Black founders to reach out when they need help with the fundraising process, pitch deck and intros for their next check. “And I do hope to write the check,” Nguyen wrote in a LinkedIn post.
Ha was among the VCs who only responded to me after I switched over to using my husband’s LinkedIn to reach out. She was nice enough to give us her email and I sent her our pitch and deck. Without trying our app (I use Intercom daily to see all the new users trying our app), Ha wrote back and said, “The opportunity is too early.” I replied asking for feedback and intros just like she had promised only a few days earlier on TechCrunch. Instead, she replied with three sentences, two of which were these:
Please do read this Medium post I wrote and/or watch the video of the talk I gave on fundraising tips. This can provide some basic knowledge if you’re looking to raise money from VCs.
To her credit, Ha did schedule a meeting with me, albeit a month out. However, her response was particularly frustrating because if she had reviewed the professional pitch deck I sent her, she would know that I’m beyond the point of needing some “basic knowledge” about the VC funding process.
Given the fact that she hasn’t even tried my app or seemed to have looked at my pitch deck, I have definite doubts about how valuable her feedback could possibly be. This experience left me feeling condescended to and disregarded.
I wouldn’t have been so upset if Ha hadn’t explicitly stated the support she promised to give to Black founders. I still have not received her promised feedback or introductions. And with her response of “read my Medium post,” it drove home the feeling that these public statements of support are all just self-promotional, not really coming from a genuine concern for or commitment to helping Black founders. That’s a problem.
Finally, Silicon Valley VCs are notorious for funding startups with only an idea. A white or Asian man with the right connections can get funded with a slide deck, no team, and no product. I’m not naive. I’m not showing up with only a slide deck and saying, “fund me because I’m a Black woman.” That’s not what’s happening at all.
I spent the last year building my app. We invested almost a million dollars of our own funds to find product-market fit and have built a great team. It’s a well-known fact that COVID-19 completely upended physical gyms and private training. Hundreds of thousands of consumers for whom training is a part of their lifestyle suddenly lost their trainer and tens of thousands of trainers likewise lost their source of income.
In the midst of this disruption, we created a way to help both sides of this market find each other. We even created new use-cases that weren’t possible before. No matter how hard you try, you’re unlikely to find an Olympic silver medalist to train you in your local gym. You can with The Bright App. Right now!
All we need is some capital so we can get the word out and grow. But because of what I look like, who I don’t know, and where I didn’t go to school, I can’t even get in front of the gatekeepers of capital to pitch my app, my vision, and my well-laid-out plan.
How will VC firms like these who are making public statements of support for Black founders actually support us? How are they going to improve the lack of representation in their industry if they won’t respond to emails from Black women? How will they write more checks for Black founders if they never provide constructive feedback or introductions?
They’re putting out a lot of statements and tweets about how they have to do a better job as gatekeepers, but as my experience shows, Black founders aren’t seeing any real change happening.
What we do see is the reality of the VC funding and startup industry, which is clearly represented by this data from Kauffman Fellows and Mac Venture Capital:
- 79.2% of startup executives are White, making them 25% overrepresented (based on the number of working-age people in the US)
- 15.6% are Asian, making them 160% overrepresented
- 2.6% are Latinx, 85% underrepresented
- 2.1% are Black, 82% underrepresented
Meanwhile, study after study has shown that greater diversity in a company leads to greater success. In the VC world specifically, diverse founding teams are known to have greater returns on investments:
Diverse founding and executive teams generate higher median realized multiples (RMs) on acquisitions and IPOs than all White founding and executive teams (3.3x to 2.5x and 3.3x to 2x respectively) [a 30% increase.]
Source: Kauffman Fellows, We’re Tired
So far I still haven’t gotten any feedback I can learn from, let alone any VCs to officially pitch to and get funding from. It’s been a frustrating experience and the data shows that I am certainly not the only one being locked out.
I don’t want more public statements of support for Black founders. I want access. I want feedback. I want the opportunity to get funding.
Venture capitalists need to recognize that stories like mine are the norm. Those leading and working for VC firms are the ones perpetuating inequality in their industry. It’s not that Black founders are not trying or don’t have companies worth funding. It is 100% that they’re sticking to the same systems which have locked people of color, women, and especially Black women founders out.
VCs don’t need to give us any more lip service, they need to build systemic change within their own companies and use their power to hold other VC firms accountable as well.
If venture capital firms are really serious about leveling the playing field for Black founders here’s what they need to do:
- Make their contact information for pitching accessible to all.
- Respond to all founders seeking funding, not just those currently in their network or who look like them, and give constructive feedback.
- Make honest efforts to connect Black founders with other VC firms if theirs isn’t the right fit.
- Prioritize their efforts for Black people and Black women. VCs must go above and beyond their normal efforts to help make up for the many systemic barriers that we face.
- Hire Black women at their firms, especially for leadership positions.
- Track and make public the demographics of their workforce and the people they’re investing in so that they can see where they must do better and we can hold them accountable.
- Read A VC’s Guide to Investing in Black Founders in the Harvard Business Review in order to gain a deeper understanding about how, “to get into a deal with a talented Black founder, and maintain a positive working relationship that can take [VCs] and them to a successful outcome.”
Simply put: instead of “I hope to write a check,” how about we start at, “I will look at you.”
Nerissa Zhang is co-founder and CEO of The Bright App, the convenient mobile app that helps top fitness instructors, personal trainers, and studio owners run more efficient, predictable, and profitable businesses from the palm of their hand. She is an elite trainer, a USAW Certified Sports Performance Coach, and an owner of two private gyms in San Francisco. You can find out more at GetBright.app and find Nerissa on LinkedIn. VCs ready to support Nerissa can email her at nerissa@getbright.app.
