UrbanGeekz 50: Meet the Black Founders Who’ve Scaled Startups to Unicorn Status

Building a successful business as a Black founder is no mean feat. Black entrepreneurs face a myriad of challenges, especially the dearth of outside investment to scale and build high-performing teams.

It’s well known that startup funding for Black founders is disproportionally low. However, what’s even more alarming is that this funding has been consistently decreasing in recent years.

In total, Black-founded startups in the U.S. raised about $2.3 billion in 2022, representing 1.1% of U.S. venture funding that year, per a recent Crunchbase News report. That’s more than a 50% drop in VC funding from 2021, while the broader U.S. funding market was down 37% in the same period.

Despite the gloomy statistics, there’s a new generation of audacious black leaders breaking systemic barriers that have historically prevented black-led businesses from scaling. These startups are changing the narrative and a handful are not just building profitable businesses, but they are scaling their ventures to attain admirable unicorn status.

Nigerian-American Tope Awotona is just one of a few Black founders who has built a widely successful “unicorn” company, despite the odds. When Awotona founded Atlanta-based online scheduling startup Calendly in 2013, he ran into common problems faced by black founders. As Awotona told Inc. Magazine, “I watched other people who fit a different ‘profile’ get money thrown at them for shitty ideas. Those VCs were ignorant and short-sighted. The only thing I could attribute it to was that I was black.”

Nevertheless, Awotona didn’t allow initial resistance to hamper his dream of building a world-class scheduling app. Although Calendly raised an initial $550k investment from Atlanta Ventures in 2014, it was in 2021 that the startup really took off. In January 2021, the company raised a staggering $350 million in a Series B funding round led by OpenView.

Awotona’s success is rare. According to a recently published article by Crunchbase, in the U.S., 13 current unicorn companies have a Black or African-American founder, out of the existing 714 unicorn companies. This amounts to just 1.8% of U.S. unicorn companies.

It’s not only in the United States that Black-led ventures are not getting enough funding. Just 0.2% of venture capital funding went to Black entrepreneurs in the U.K. between 2009 and 2019, according to Extend Ventures.

Still, two brothers who have beat the odds are Oliver Kent-Braham and his twin brother Alexander, the co-founders of Marshmallow. In an interview with BBC, Kent-Braham said, “We’d always had a bit of an entrepreneurial flair. When we were 12, we were selling golf balls fished out of the lake and that sort of stuff. In our early 20s, we got into the tech world. The whole space is exciting, and that’s when we started to think that we wanted to start our own tech company.”

The idea for Marshmallow ignited when one of the twins’ Canadian friends who had recently moved to the UK told them he kept receiving expensive quotes for car insurance. This led them to the big question: how do you find reasonably priced insurance if you don’t have a UK driving licence?

Marshmallow was their solution, and they launched the business in 2016. The startup is a digital-first, licensed insurance carrier, that specializes in offering customers cheaper, fairer, and faster products. Marshmallow strives to make motor insurance accessible to underrepresented sectors.

On their experience with venture capitalists, Kent-Braham said, “Venture capitalists hold the keys to starting new companies. You have to have a mutual acquaintance to even speak to many funders, and that needs to change.”

Nonetheless, as of 2021, the start-up has netted more than 100,000 users. It grew its headcount by 200% in 2020 to 170 staff, and raised $85 million (£62 million) in a Series B funding round from tech investors including Monzo-backer Passion Capital, giving it a valuation above $1.25 billion.

Like Awotona’s Calendly and Kent-Braham’s Marshmallow both brands hitting billion-dollar plus valuations.

Other Black founders who featured on UrbanGeekz’s inaugural 50 list include Sarah Menker, Wemimo Abbey, Ham Serunjogi, Toyin Ajayi, Oliver Kent-Braham, and Rihanna. These startups cut across fintech, insurtech, software, business to consumers, food, climate, and healthtech.

In addition, some Black founders have moved on from their unicorn-founded startups to launch new ventures to create more impact. One such founder is Julia Collins. Her previous company Zume Pizza was a unicorn.

Collins is the first Black woman to co-found a startup that would reach “unicorn” status (valued at more than $1 billion) after launching her robotic pizza company, Zume, in 2018.

She currently leads Planet FWD. The platform provides food, fashion, and beauty brands with the tools to understand, reduce and neutralize their carbon footprint, and get on a path to net-zero emissions.

Speaking to Urbangeekz about her motivations for Planet FWD, she said, “I founded Planet FWD on a mission to decarbonize our food system and the broader consumer industry. Today, we partner with companies like Blue Apron, Patagonia Provisions and Compass Group to measure and reduce their impact on our planet across their products and organizations as a whole. We’ve been so inspired by the actions these companies are taking, and I look forward to a future where the entire consumer landscape, from food to fashion to beauty, is minimizing its footprint.”

In 2022 Collins announced that Planet FWD had raised a $10 million Series A from Acre Venture Partners and Congruent Ventures, bringing her total funding to $16.8 million. Although Planet FWD is not a unicorn yet, the carbon accounting platform is on its way to becoming one in the near future.

Another notable Black founder who has moved on from their unicorn startup is Iyinoluwa Aboyeji, who holds the distinct record of cofounding two African unicorns – Andela and Flutterwave.

Andela cultivates IT talent in Africa and provides leading global technology companies with access to a high-skilled resource pool. Meanwhile, Flutterwave provides a payment infrastructure for global merchants and payment service providers across the continent.

Aboyeji is currently the CEO and General Partner of Future Africa, a platform that has invested in over 100 companies across the continent, collectively worth over $6 billion, in sectors such as fintech, edtech, healthtech, and agritech.