Black communities make new ventures relevant, but often miss out on wealth creation

Like tech Twitter, for audio... Nightmare fodder. Buzzy audio-based social network Clubhouse recently raised cash at a reported $1B valuation, 10X its valuation in May. Back then: the invite-only app had just 1.5K users and was almost exclusively filled with early investors, their friends, and tech bros. In less than a year, it has gained 5M users, mainstream appeal, and a potential Facebook copycat. That’s largely thanks to its community of Black users:

• Since July, Clubhouse’s Black community has grown significantly. Black people are driving conversation through interest-focused clubs and community events. Think: Black in Tech, Black Beauty Club, and Black Bitcoin Billionaires.
• Black artists have been major growth drivers, with stars like Drake, Meek Mill, 21 Savage, and Tiffany Haddish hosting chats. Performances organized by Black creators, like the Clubhouse-rendition of The Lion King, have boosted downloads and maxed out chat “room” capacities. Highlighting the importance of Black artists to the platform: Clubhouse’s logo recently featured musician Bomani X, the host of a music-focused room on the app.

Pull up the stats... Clubhouse isn’t the only social app whose growth was propelled by Black communities. In the early stages of Snapchat, Vine, and Dubsmash, Black people were overrepresented in usage — fueling mainstream adoption by making these apps cool, creative, and relevant. “Communities of color drive the cultural conversation and a lot of the initial wealth creation for apps like Clubhouse,” according Mercedes Bent, partner at Lightspeed Venture Partners. While Black communities drive growth, they don’t reap its financial benefits as much. That’s partly a result of:

• Unequal access to funding: From 2015 to 2020, Black and Latinx founders raised ~$15B, just 2.4% of the total venture capital raised during that period.
• Lack of diversity in VC: Today, only 2% of decision-makers at VC firms are Black. And in 2018, just 4% of VC employees were Black.