In the UK, Black-owned enterprises are growing, helping create more jobs and innovation for society as well as money into the economy. Yet, despite the potential black businesses have, these ventures often hit a brick wall when it comes to accessing funding. Systemic barriers, bias, and a lack of access to traditional finance leave many Black entrepreneurs struggling to get their ideas off the ground or scale them up. Here’s why this gap exists and the ways Black people in the UK can secure the cash they need to thrive in their endeavours.
The Funding Struggle
The numbers tell a sad story. Black founders in the UK are four times less likely to apply for funding than their white counterparts, according to The Black Report by Google for Startups. When they do, they face more hurdles—56% of Black-owned businesses only get funding after they’ve proven consistent growth, compared to white-led firms that are often able to secure funding at an earlier stage. Venture capital (VC) is even bleaker: Black entrepreneurs snag less than 2% of VC dollars globally, and in the UK, the figure’s just as dark. Self-funding is the norm as 88% of Black-led startups rely on personal savings, which is a risky move that limits growth and exposes founders to financial strain in their personal life.
The reason this is the case is because of the obvious historical wealth gaps, meaning that fewer Black families can bankroll startups. Banks and investors often demand more proof of success from Black founders, due to stereotypes and unconscious bias.
Black Businesses in the UK: The Funding Gap and How to Bridge It
In the UK, Black-owned enterprises are growing, helping create more jobs and innovation for society as well as money into the economy. Yet, despite the potential black businesses have, these ventures often hit a brick wall when it comes to accessing funding. Systemic barriers, bias, and a lack of access to traditional finance leave many Black entrepreneurs struggling to get their ideas off the ground or scale them up. Here’s why this gap exists and the ways Black people in the UK can secure the cash they need to thrive in their endeavours.
The Funding Struggle
The numbers tell a sad story. Black founders in the UK are four times less likely to apply for funding than their white counterparts, according to The Black Report by Google for Startups. When they do, they face more hurdles—56% of Black-owned businesses only get funding after they’ve proven consistent growth, compared to white-led firms that are often able to secure funding at an earlier stage. Venture capital (VC) is even bleaker: Black entrepreneurs snag less than 2% of VC dollars globally, and in the UK, the figure’s just as dark. Self-funding is the norm as 88% of Black-led startups rely on personal savings, which is a risky move that limits growth and exposes founders to financial strain in their personal life.
The reason this is the case is because of the obvious historical wealth gaps, meaning that fewer Black families can bankroll startups. Banks and investors often demand more proof of success from Black founders, due to stereotypes and unconscious bias.
Best Ways to Get Funded
The good news? Black entrepreneurs now have options than ever to get funding and VC capital for their business. Here are the top routes to funding in the UK, with Black-focused options leading the charge:
- Grants for Black Ventures
Grants are free money—no repayment, no equity lost. Programs like the Wray Forward Programme offer up to £10,000 for UK Black-owned businesses and workshops to hone & develop skills. It’s backed by the alcohol brand Wray & Nephew, targeting sustainable growth for firms held back by finance woes. Check eligibility on their site. - Crowdfunding with a Purpose
Crowdfunding lets you pitch directly to the general public, bypassing gatekeepers. The Black Funding Network (BFN) is a standout, designed for Black-led nonprofits and small businesses. Founders are able to raise up to £140,000 by tapping into a supportive community. It’s low-risk, high-reward play. It may take time to create a campaign that’ll help your crowdfund but it’s a way to get much needed funding. - Specialist Investment and Accelerators
Some venture capital and accelerators are stepping in for Black founders and the skills they possess. Black Seed, a Brixton-based fund, invests solely in Black entrepreneurs, offering seed cash and mentorship. Meanwhile, Foundervine runs programs like its Growth Accelerator, pairing Black startups with experts and investors. These organisations don’t just hand out money, they help you build networks that may help you in the long-term. - Government Loans and Support
The UK’s Start Up Loans scheme, via the British Business Bank, has delivered over £100 million to young founders since 2012, with Black and ethnic minority entrepreneurs typically grabbing a higher share per capita than white peers. Loans start at £500, with mentorship included. This organisation isn’t Black-specific and it’s open to all—apply through Start Up Loans and pitch your vision. - Community Networks and Angel Investors
Joining a group like the Black Business Network helps you connect to mentors, resources, and potentially angel investors who prioritize diversity and are likely to relate to you. Angel Investors are wealthy individuals who are betting on startups and offer cash and know-how without the red tape of banks. Look for events or directories on these sites to pitch your idea and create a network face-to-face.
Tips to Stand Out
Whatever route you choose, preparation is key. Ensure that your business plan is airtight, present show revenue potential and impact. Practice your pitch because confidence sells. Look into free resources like Lloyds Bank’s Black Business Advisory hub or Digital Boost’s mentoring.
The Bigger Win
Funding isn’t just about survival, it’s about power and equity. Every pound invested in a Black-owned business creates jobs, boosts communities, and chips away at the inequality and challenges faced by the black community. The UK’s Black business scene is buzzing with talent, from haircare innovators to tech disruptors. With the right support, whether through the support of BFN, Black Seed, or beyond, these ventures can rewrite the economic story.
Best Ways to Get Funded
The good news? Black entrepreneurs now have options than ever to get funding and VC capital for their business. Here are the top routes to funding in the UK, with Black-focused options leading the charge:
- Grants for Black Ventures
Grants are free money—no repayment, no equity lost. Programs like the Wray Forward Programme offer up to £10,000 for UK Black-owned businesses and workshops to hone & develop skills. It’s backed by the alcohol brand Wray & Nephew, targeting sustainable growth for firms held back by finance woes. Check eligibility on their site. - Crowdfunding with a Purpose
Crowdfunding lets you pitch directly to the general public, bypassing gatekeepers. The Black Funding Network (BFN) is a standout, designed for Black-led nonprofits and small businesses. Founders are able to raise up to £140,000 by tapping into a supportive community. It’s low-risk, high-reward play. It may take time to create a campaign that’ll help your crowdfund but it’s a way to get much needed funding. - Specialist Investment and Accelerators
Some venture capital and accelerators are stepping in for Black founders and the skills they possess. Black Seed, a Brixton-based fund, invests solely in Black entrepreneurs, offering seed cash and mentorship. Meanwhile, Foundervine runs programs like its Growth Accelerator, pairing Black startups with experts and investors. These organisations don’t just hand out money, they help you build networks that may help you in the long-term. - Government Loans and Support
The UK’s Start Up Loans scheme, via the British Business Bank, has delivered over £100 million to young founders since 2012, with Black and ethnic minority entrepreneurs typically grabbing a higher share per capita than white peers. Loans start at £500, with mentorship included. This organisation isn’t Black-specific and it’s open to all—apply through Start Up Loans and pitch your vision. - Community Networks and Angel Investors
Joining a group like the Black Business Network helps you connect to mentors, resources, and potentially angel investors who prioritize diversity and are likely to relate to you. Angel Investors are wealthy individuals who are betting on startups and offer cash and know-how without the red tape of banks. Look for events or directories on these sites to pitch your idea and create a network face-to-face.
Tips to Stand Out
Whatever route you choose, preparation is key. Ensure that your business plan is airtight, present show revenue potential and impact. Practice your pitch because confidence sells. Look into free resources like Lloyds Bank’s Black Business Advisory hub or Digital Boost’s mentoring.
The Bigger Win
Funding isn’t just about survival, it’s about power and equity. Every pound invested in a Black-owned business creates jobs, boosts communities, and chips away at the inequality and challenges faced by the black community. The UK’s Black business scene is buzzing with talent, from haircare innovators to tech disruptors. With the right support, whether through the support of BFN, Black Seed, or beyond, these ventures can rewrite the economic story.
