Crunchbase announced Thursday that it is starting to track the amount of venture capital dollars invested in founders who identify as part of the LGBTQ+ community.
The new data source is an addition to Crunchbase’s Diversity Spotlight, which tracks the amount of venture capital funding raised by founders within marginalized communities. Similar to its other diversity tags, LGBTQ+ founders will have to self-identify and opt-in to wanting their information publicly shared. Crunchbase said its intention is to help raise awareness of LGBTQ+ founders looking for funding, as well as offer data and transparency around investments within the community. The announcement coincides with the first day of Pride Month.
“Having concrete data helps in advocating for policy changes, funding initiatives and resource allocation to support LGBTQ+ entrepreneurs,” said Ryan Husk, Crunchbase’s director of business development. “It enables us to make evidence-based arguments for greater equity and access within the startup ecosystem.”
It was estimated by Backstage Capital that less than 1% of all VC dollars are raised by companies with founders openly within the LGBTQ+ community. Members of the community often face hurdles while fundraising, whether it’s dealing with openly transphobic investors or code-switching to hide one’s sexuality in trepidation of homophobia.
“I’ve heard founders say they delete any mention of same-sex partners, advocacy work or involvement in anything LGBTQ+ while raising capital as they fear investors will see it during due diligence,” said Chasing Rainbows General Partner Patrick Driscoll.
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