3 black investors tell us what they’re looking for in 2023

Founders and investors are bracing for a tough 2023 as the economy shows little sign of improvement. But there are many questions in the air: Will VC’s gunpowder wagon hit the market? Will there be more layoffs if ratings pressure continues? What does the AI ​​expect?

However, we can answer a few questions: some trends will definitely continue, such as B. interest in artificial intelligence and cryptocurrencies will come under scrutiny even as the market looks to the future. There are other aspects of the business world that are unlikely to change, such as the lack of funding for women and minority founders.

To find out how minority investors plan for 2023, we spoke to three active black investors. For Xfund Vice President Jadyn Bryden, the creative economy will be a major focus in the coming months. “I foresee a continued movement in the creator economy as more people dare to build their own brands and rely on new tools to create and monetize content,” he said.

Alexis Alston, director of Lightship Capital, believes the future will be favorable for companies that develop technology to help others do business and reduce costs: companies that rely more on sales optimization and content creation tools as replacements for teams that were previously highly redundant. goods.”

But investors are pessimistic about improving capital allocation for black founders next year.

Richard Kerby, general partner at Equal Ventures, expects to see more diversified founder funding in the coming year, but don’t expect major changes. “I think a lot of the narrative that many investors put out about investing in more black founders was just hot air and not a lot of content or real dollars going to black founders.”

We speak with:

Alexis Alston, director of Lightship Capital

Which sectors will you keep an eye on and what trends do you expect for the coming year? Why?

I’ve always been interested in the ever-growing applications of AI, including generative AI, natural language processing, and deep learning. I’m really looking forward to seeing how AI can help scale businesses that were previously led by humans, such as B. Sales, social media, marketing and content development.

As the fast-growing tech darlings begin to reduce overhead, I think we’ll see a sharp shift to companies relying more on sales optimization and content creation tools to replace teams that were once highly redundant.

What is the most pressing political issue you are looking at and how does it affect you as an investor? Would you support a startup that solves one of these problems?

Currently, there is a deep current around expectations or lack of political oversight for emerging technologies and financial products. In everything from crowdfunding to cryptocurrencies, there is a major lack of oversight that is only now beginning to impact many of our institutional investors and consumers.

As an investor, the lack of oversight has led to extremely high valuations and unrealistic expectations of exit potential in these emerging markets. In the end, the average angel investor (who is more representative of the general population than institutional investors) always gets the worst of it.

Given that the percentage of venture capital that goes to black founders rarely exceeds 1%, do you think next year will be different? Why or why not?

Not sure if it will be different next year. At the very least, I’m deeply concerned that the number will drop in 2023 as institutional funds tighten their budgets or start exploring criteria for founders that often exclude black founders.