Increasing its investment in black-led startups in the UK, Google for Startups will give entrepreneurs a chance to receive GBP 3 million to fund their business and hedge the inequality in venture capital.
The Black Founders Fund was launched last year, and has now doubled the size of its grant. Last year, the fund offered USD 2 million to startups in the UK. The funding was distributed between thirty black-led startups in Europe. This included 20 startups in the UK alone.
WPP and ITV are among the various companies participating in the Black Founders Fund to provide support to the recipients of the funding.
In 2021, startups were invited by ITV to participate in their industry leading program, providing GBP 1 million worth of airtime and production – all equity free. The founders of these startups were also offered the services of WPP’s network of creative agencies, and were provided with marketing know-how that aided the companies in addressing their target audiences.
Google for Startups will offer each successful company a range of benefits including USD 100,000 cash awards, USD 200,000 in ad support and cloud credits, and connections within the Google network, aside from one-on-one mentoring by industry experts.
Prior to the launch of the Black Founders Fund, black-led startups received less than 0.25 percent of the venture capital available, and in the last ten years, only 38 black founders received funding for their ventures.
On average, recipients of the 2021 Black Founders Fund venture capital increased staff count by approximately 21 percent, and were able to raise USD63 million in additional funding. Out of 16 black women who received funding in the UK, 7 were participants in the Black Founders Fund program. Eight founders were also featured in the Top 10 Black Founders to Watch in Europe.
Google to scale up support
Marta Krupinska, Head of Google Startups UK, stated that after launch last year, the Black Founders Fund received almost eight hundred applications from businesses across Europe. She also said that Google was excited to double the fund in 2022, and would scale up their effort to address inequality in venture capital funding and support black startup founders.
Head of VC and startup Partnerships EMEA at Google, Rachael Palmer said that a large number of startups that received funding in the previous year were able to generate significant returns for their investors, in some cases generating more than 10 times the capital investment within a span of one year. She noted that with this performance, the startup recipients demonstrated that there is a huge untapped potential within the Black community.
Group Director of Diversity and Inclusion at ITV, Ade Rawcliffe, observed that black startup founders remained underserved with access to venture capital. She stated that although Blacks and multi-ethnic communities represent a significant percentage of the UK population, only 1.58 percent have received venture capital funding in total.
WPP Country Manager Karen Blackett added that developing a product, service or idea is only the start of the journey. In order to scale up, the business should be able to communicate its vision and reach to the target audience. She appreciated the fact that starting a business was difficult enough without the added barrier of being a Black founder. She also said that WPP was proud to be able to offer training and support to the recipients of the Black Founder Fund.
The CEO and Co-founder of Scoodle, Ismail Jeilani, said that beyond just the money, the most valuable thing that an investor can provide is recognition in the market, something that cannot be quantified. Scoodle is an ed-tech startup that received funding from the Black Founders Fund last year.
He added that it was powerful to say that his company had received funding and support from a company like Google. Explaining this, he added that since receiving the funding, monthly users of Scoodle have tripled, and additional capital has been raised.