Black Entrepreneurs, Groupthink, and Venture Capital Funding

Black entrepreneurs want to start successful businesses but have different challenges in achieving that goal. Typical reasons given for lack of Black success are not belonging to the right personal and professional networks, their businesses having shorter lifespans, and racism. One other reason given is the lack of success obtaining venture capital from sources like those in Silicon Valley. One explanation for the low funding levels is that Black entrepreneurs don’t ask for enough money. This paper proposes that Black entrepreneurs who rely on the same sources of support tend to not effectively problem-solve in order to access more venture capital because of groupthink which constrains their thinking and prevents novel decision-making. Discussion and future research is included.