Why Black Founders Should Look Beyond VC Funding for Success
For years, I hesitated to write about my experiences as a Black founder in the tech industry. Speaking openly about racial bias contradicts the lessons I learned early in life—to avoid making others uncomfortable or being perceived as “playing the victim.” But silence is no longer an option.
The VC Funding Disparity: A Harsh Reality
As the founder of Indenseo, an insurtech company specializing in automated underwriting solutions, I quickly realized that venture capital was not designed for entrepreneurs like me. Despite having:
- Strong industry relationships
- Backing from angel investors
- A proven track record in insurance analytics
…securing VC funding remained nearly impossible. My white colleagues who attended pitch meetings with me were shocked by the dismissive treatment—behavior I had come to expect as normal.
By the Numbers: The Stark Racial Divide in Venture Capital
- 0.4% of VC-funded entrepreneurs were Black between 1990-2016 (Harvard study)
- 34,000 white entrepreneurs received funding during that period
- 188 Black entrepreneurs received funding—about 7 per year
These statistics reveal a sobering truth: Black founders have better odds of becoming professional athletes than securing venture capital.
Firsthand Experiences With Systemic Barriers
The Pattern of Disrespect
When bringing white colleagues to pitch meetings, they consistently noted:
- Unusually dismissive behavior from investors
- Lack of engagement with our business proposition
- Treatment they’d never experienced in their own fundraising efforts
Overt Bias in the System
Several encounters stood out:
- A VC bluntly stated: “There’s nothing you can say to make me invest”
- Another defended Silicon Valley’s homogeneity, arguing its success proved no need for change
- A consultant violated our NDA to copy our business model—and secured $40M in funding
Alternative Paths to Success
Why We Moved Beyond VC
After countless unproductive meetings, we:
- Focused on angel investors with industry expertise
- Built strategic partnerships within insurance
- Developed our product through sweat equity
Key Lessons for Underrepresented Founders
- VCs aren’t the only gatekeepers: Explore angels, corporate investors, international funding
- Industry validation matters more: In insurance, trust and results outweigh VC endorsements
- Build your network strategically: Our advisory board became our greatest asset
The Road Ahead
Today, Indenseo is proving its value through:
- Industry recognition from major insurers
- A flagship product gaining traction
- A team that earns respect through expertise
The takeaway? Success doesn’t require VC approval. For Black founders especially, alternative paths may offer better opportunities to build meaningful, sustainable businesses.
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