Marshmallow Becomes the Second Black-owned start-up to Hit $1 Billion Valuation

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Marshmallow co-founders Alexander and Oliver Kent-Braham.
Marshmallow co-founders Alexander and Oliver Kent-Braham.

According to data firm CB Insights, over 800 privately-held tech firms worldwide have hit the $1 billion valuations.

However, Marshmallow, a London-based digital insurance platform is a different case. The company was founded in 2017 by mixed-race identical twins Alexander and Oliver Kent-Braham and it’s the second Black-owned company in Britain to reach the status of “unicorn.” First, Zepz had achieved a $5 billion valuation in an august financing round. The firm was founded by the Somali-born entrepreneur Ismail Ahmed.

 “We were pretty surprised by this fact,” Oliver Kent-Braham, Marshmallow’s CEO, told CNBC in an interview.

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The tech industry in the United Kingdom lacks diversity. Less than 1.6% of venture capital funding was shared between the all-ethnic founding teams from 2009 to 2019, according to Extend Ventures, while only 0.2% of funding went to Black entrepreneurs.

Kent-Braham blames it on the venture capital mindset. He argued that tech investors ignore cold emails and only back founders that their colleagues recommend.