While gender equality in the workplace has seen much momentum as of recent, it would seem that they remain unrepresented in the world of technology startups, in particular among African American females, according to Chicago Inno.
Of the 10,283 venture deals in the United States that occurred between 2012 and 2014, only 24 led by African American women received venture capital funding. Even those who do, typically raise an average of just $36,000.
Overall, only 11 startups founded by black women have raised venture capital funding of more than $1 million.
The black founder of the startup 4D Healthware, Star Cunningham, is working to join these 24 startups by raising a goal of $610,000 in venture capital funding. This initiative is aimed at expanding the company’s personal health dashboard.
This program will allow 4D Healthware to help patients suffering from chronic conditions better monitor their health using data gathered from wearable fitness devices, such as Fitbit bracelets. The information is then sent to phones and computers acting almost like a health alert system.
Devices such as these are rapidly growing in popularity. Just from Fitbit’s initial public offering a few years ago, the company managed to perform as one of the top competitors in its sector with an opening of 52% of its indicated price. With that sort of capital, Fitbit was able to boost productivity, output, and sales.
As an example of the 4D Healthware dashboard’s functionality, diabetic patients, for instance, can use an activity tracker in combination with a Bluetooth enabled glucometer and wireless blood pressure monitors. These features allow patients can remain up-to-date on their condition in real-time.
If the information provided is determined to be a problem by the dashboard, yellow and red warning lights will will flash to help them avoid a serious issue before it arises.
“If you think about driving your car, you have all of this maintenance that you have to do or a light will come on,” said Cunningham. “Well, why don’t we have something like that for our bodies? 4D Healthware is designed to do that and be that tool that tells you more than eat right, exercise, drink more water. It tells you specifically what you can do to improve your health.”
As one of only a handful of African American female entrepreneurs in the Chicago area, Cunningham attributed this demographic’s difficulty finding funding to minorities having a hard time raising money from a friends and family round.
Many venture capitalists view friends and family rounds as a valuable tool to offer startups early traction. Unfortunately, many minority founders don’t have a network of wealthy friends and relatives, as Cunningham found.
“When I went to my family to ask them to invest in my company, this was all so new to them. It’s foreign to them. I did have family members who did invest, but my friends and family round was extremely small. There’s no one in my family that would write a $25,000 check,” Cunningham explained.
Cunningham feels that the only way to resolve this issue is for venture capitalist organizations to make a point to invest earlier in minority-led startups.
For startups located in Baltimore, MD, this may soon become a reality thanks to the Anne Arundel Economic Development Corp. and the Small, Minority and Women-Owned Business Investment Fund.
Baltimore Business Journal reports that the Anne Arundel Economic Development Corp.’s VOLT Fund offered four Baltimore technology startups with a total of $800,000 in loans.
These loans included $150,000 Vasoptic Medical Inc., $250,000 to Grip Boost LLC, $150,000 to Appian Medical Inc., and $250,000 for Vixiar Medical Inc..
While $800,000 is a generous offering, each year, the fund receives $1.8 million from the state’s Small, Minority and Women-Owned Business Investment Fund. That type of venture capital could boost African American woman-led startups to compete at higher levels.