Black-Owned Fund Bridging Gap In Venture Capital Sued For Alleged ‘Discrimination’
A small, Black-owned venture capital fund investing in businesses led by women of color is being sued for allegedly running a “discriminatory program” by the same players that helped overturn affirmative action.
The American Alliance for Equal Rights filed in Atlanta federal court on Aug. 2 accusing Fearless Fund, an organization that has invested in Black woman-owned businesses, including Slutty Vegan, of racial discrimination. According to ABC News, the alliance claimed the fund’s Fearless Strivers Grant Contest violates part of the Civil Rights Act of 1866 that prohibits racial discrimination in contracts. The contest awards $20,000 to Black women who run businesses, according to the fund’s website.
Westlaw, a research service and proprietary database for lawyers and legal professionals. stated the alliance wants to end the grant program. If that wasn’t enough, the alliance also wants the Atlanta court to place a restraining order and preliminary injunction against Fearless Fund by August 17, 2023. Apparently, the goal is to keep the company from identifying its next round of grant recipients, Westlaw reported. The president of the alliance, and the name behind the lawsuit, Edward Jay Blum, was also involved in the Harvard College and University of North Carolina Supreme Court cases that outlawed affirmative action in college admissions, Westlaw noted.
In 2022, CNBC reported Black entrepreneurs received less than 2% of venture capital funding every year. Black women business owners got even less, at 1%, the news outlet determined from data on Crunchbase. That’s where Fearless Fund comes in. The venture capital player boasts a diverse portfolio of businesses run by Black women and women of color, including Hairbrella, The Lip Bar, and Live Tinted.
Harvard Business Review reported that Black women are more likely, at 17%, to start a business than White men, at 15%. Black women business owners are not sitting around waiting for things to change in venture capital. They are advocating for themselves even in the face of obstacles.