WHAT TO EXPECT IN 2H 2022?
Christina Caljé shares her views in this article delving into the market dynamics that startup founders and VCs are navigating since private markets began to contract in early 2022.
With two quarters left in the year, Dominic-Madori Davis from TechCrunch interviewed global experts across the startup ecosystem for their perspectives on fundraising conditions for the Black founder community during 2H 2022, and how founders can best position themselves for success.
Selection from the article:
Expect the slowdown to continue
As predicted, the venture capital market slowed in Q2, with just $108.5 billion raised by startups globally, the smallest total since the end of 2020, as TechCrunch reported. U.S. startups raised $52.9 billion in Q2 2022, significantly less than the $70.1 billion raised in the first quarter of the year.
Black founders raised $1.2 billion — or 1.7% of the $70.1 billion — in Q1 before raising just $324 million — or 0.62% of the $52.9 billion — in Q2, according to CB insights. The rest of the year is uncertain, with the economic slowdown predicted to persist.
Angel investor Christina Caljé told TechCrunch that this slowdown is healthy and necessary after last year’s extreme fundraising and the resulting startup valuations. The main issue for the Black community is that during uncertain times, venture investors often revert to the familiar, which could mean focusing on the mostly white-and-male networks they funded before the increased push for diversity a few years ago.
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Expect a tightened focus on community
Caljé said that Black founders may have an advantage in the coming quarters due to the number of Black VC funds, angel syndicates and accelerator programs launched in the past year. Therefore, this is the right moment to focus on finding the right investors and building relationships.
“There are local and global Black founder communities that have organically formed to share advice around fundraising, term negotiation, business modeling, operational scaling, breaking into new markets and sometimes simply emotional support,” she told TechCrunch.
She pointed to Visible Figures, the Black tech collective formed by entrepreneur Stephanie VanPutten, as an example of a network that Black founders and VCs should consider joining during this time. There is also Omek and European Black Investors Network, while Caljé highlights Impact X, Collab, Harlem Capital, 10×10 and Cornerstone Partners as firms to look at in terms of committed support to Black founders.
“Our visibility and proactivity are more important than ever,” she said. “Building a community of founders and investors around this shared vision for a more equitable startup ecosystem is our strength and obligation.”
