In the world of entrepreneurship, Black Americans have been historically underrepresented, with only 1% of roughly $215.9 billion in venture capital investments allocated to companies founded by Black entrepreneurs. That equates to $2.3 billion, despite an uptick in Black business ownership in recent years.
Knowing that obstacles still exist, both public and private organizations have worked to boost funding opportunities for Black-owned businesses. Here are 21 government agencies, programs, and venture capital firms that can assist Black-owned businesses with getting capital.
[Read more: 22 Resources for Black-Owned Businesses]
Backstage Capital
The venture capital firm Backstage Capital is known in the tech industry for its commitment to investing in companies led by underrepresented founders, including people of color and women. Backstage Capital Founder and Managing Partner Arlan Hamilton inspirationally started the firm after experiencing homelessness and has convinced business all-stars like Marc Andreessen and Chris Sacca to invest in the fund.
To date, the firm has invested more than $20 million in 200+ companies led by underrepresented founders. Additionally, the firm announced a strategic partnership with KingsCrowd, launching the Flex Fund II: a $3 million fund bringing new startups into the Backstage portfolio.
Community Development Financial Institutions Fund
The Community Development Financial Institutions (CDFI) Fund, part of the U.S. Treasury Department, plays a vital role in helping lesser-served U.S. business owners by increasing access to capital. Many Black-owned businesses have been helped by CDFIs, because these institutions specifically “provide loans, investments, financial services, and technical assistance to underserved populations and communities.” On top of this, the CDFI Fund offers tax credits to spur investment. Business owners can search for local financial institutions that have received money from the CDFI Fund and that in turn can provide tailored assistance.
Founders First Capital Partners
Founders First Capital Partners offers a unique take on funding with “revenue-based investment” for service-based companies led by minority, veteran, or women founders. The organization has a flexible payback model, where payments are determined from cash flow instead of being a set amount each month. On top of investments, the firm also has business accelerator programs and a learning platform that can help business owners.
Accolade Partners
Accolade Partners is an alternative asset platform that specializes in technology and healthcare-focused venture capital and growth equity fund investments. In 2019, Accolade launched its first fund to build a portfolio of managers from historically underrepresented groups across venture capital and growth equity. As of 2023, Accolade Partners has raised $325 million to invest in funds started by women and minorities.
Grants.gov
The website Grants.gov offers a centralized location to learn about and apply for federal grant opportunities from more than 20 agencies. These “grant-making agencies” award more than $500 billion annually to businesses of all types. No matter the background of your business or the type of company you have, there may be a grant opportunity available through this portal.
Reign Ventures
Reign Ventures is a venture capital fund that focuses on seed and series A investment opportunities at companies led by women and minority-led startups. Reign invests in technology and tech-enabled startups with high-potential founders. The fund has backed successful companies like Appy Couple, a wedding planning app, and the fashion rental platform Villageluxe.
Harlem Capital Partners
New York City-based Harlem Capital Partners makes initial investments of $1 million to $2.5 million in U.S. seed rounds for 10% to 15%+ ownership. The firm debuted its $40 million diversity-focused venture capital fund in December 2019 with the goal of investing in minority and women founders around the United States. The second fund (Fund II) closed in March 2021 at $134 million. Today, HCP has invested in 53 companies composed of 61% Black- or Latino-led companies and 43% women-only-led companies.
IFundWomen of Color
IFundWomen is a marketplace for women-owned businesses and those who wish to support them with access to capital, networking opportunities, and coaching and mentorship. IFundWomen of Color, a partnership with Caress and American Express, offers access to debt-free capital through crowdfunding and business grants, as well as business and fundraising coaching, networking, and other resources to female entrepreneurs of color. Twice a year, the IFWOC offers $5,000 grants to 60 businesses plus an accelerator program to help them get started.
NBMBAA Scale-Up Pitch Challenge
Run by the National Black MBA Association, the Scale-Up Pitch Challenge is a competition inviting participants to share their business ideas with early stage investors and venture capitalists. Winners receive a $50,000 grand prize, with additional top prizes for second place and third place as well as a People’s Choice award. The challenge offers great networking and exposure to funders in addition to the winning investment.
The Coalition to Back Black Businesses
Brands including American Express, Optimum, Shopify, Stanley Black & Decker, the National Black Chamber of Commerce, the National Business League, and the U.S. Chamber of Commerce Foundation have joined together in the Coalition to Back Black Businesses to empower Black-owned businesses. More than $6.4 million in grants have been awarded to 1,091 Black-owned small businesses spanning 40 states. The CBBB’s funding has been crucial in covering operational costs, including inventory, payroll, and utilities.
Kapor Capital
Oakland, California-based venture capital firm Kapor Capital prides itself on its commitment to helping diverse entrepreneurs, as “founding teams from underrepresented backgrounds provide a competitive edge.” The company’s current portfolio has 59% of its investments going to companies with “a founder who identifies as a woman and/or an underrepresented person of color.”
Brands including American Express, Optimum, Shopify, Stanley Black & Decker, the National Black Chamber of Commerce, National Business League, and the U.S. Chamber of Commerce Foundation have joined together in the Coalition to Back Black Businesses to empower Black-owned businesses.
Minority Business Development Agency
The Minority Business Development Agency (MBDA), an agency of the U.S. Department of Commerce since 1969, works to promote the growth of minority-owned businesses. One aspect of their work includes providing resources about grants and loans. Black business owners looking for guidance on local funding opportunities can do so at one of the MBDA’s Minority Business Centers, which are located in major metropolitan areas all over the country.
The U.S. Small Business Administration
The U.S. Small Business Administration (SBA) provides important resources to small businesses of all kinds and has multiple programs that can help Black-owned businesses. The SBA’s Lender Match tool helps connect small businesses with SBA-approved CDFIs (read more about them above) and small lenders that can provide a personalized touch. Notably, the SBA also has two federal contracting programs that may be relevant to Black-owned businesses: the 8(a) Business Development program and the HUBZone program.
National Black Business Pitch
The National Black Business Pitch is an annual competition in which Black-owned business owners pitch their businesses in front of professionals in corporate management and supplier diversity, promoting their services and products while potentially expanding their network of customers and vendors. The contest is structured in two stages. Initially, participants submit a three-minute pitch video. From there, 30 companies are selected to advance to the second stage — the live pitch finals. The three winning companies are awarded up to $10,000 in cash.
Black Girl Ventures
The BGV Pitch Program, hosted by Black Girl Ventures, is the world’s largest pitch competition for Black and Brown female business owners. Combining crowdfunding and pitching to provide marginalized women access to financial and social capital, the competition has generated over $10 million for pitch participants and funded more than 450 women of color since its inception. It is open to Black and Brown female founders who have operated a revenue-generating business for at least a year, with winners receiving cash prizes up to $10,000, among other benefits.
Corporate Counsel Women of Color Entrepreneur Grant
Businesses can apply on a rolling basis for the Corporate Counsel Women of Color Entrepreneur Grant, which awards $2,500 to five for-profit businesses owned by women of color. Eligibility criteria require that the business be operational since January 1, 2020, and that it has earned a minimum of $25,000 in revenue since its inception. The current application period for the 2024 grants is open.
[Read more: How to Build a Stronger Black-Owned Business Ecosystem in the U.S.]
Restaurant Business Development Grant Program
The Restaurant Business Development Grant Program by the Feed the Soul Foundation is an initiative that addresses food injustice through supportive resources and training for culinary businesses. Winners are awarded a $10,000 stipend plus six months of tailored consultations and specialized training services. To qualify, companies must be at least 51% owned by marginalized individuals, have at least four employees, and have operated in the U.S. for at least 24 consecutive months before applying.
NAACP Powershift Entrepreneur Grant
The NAACP Powershift Entrepreneur Grant is a funding opportunity made possible by a partnership between Medium Rare and The Shark Group — founded by Daymond John of ABC’s TV show “Shark Tank.” The grant program provides both up-and-coming and long-standing Black-owned businesses and Black entrepreneurs nationwide with the capital and tools needed to pursue their small business goals. Selected winners are awarded a $25,000 grant plus educational resources and mentorship opportunities, empowering them to expand and scale their businesses.
Ingredients for Success Entrepreneurs Initiative
The Ingredients for Success Entrepreneurs Initiative is a national pitch competition hosted by Famous Amos and the National Black Chamber of Commerce that aims to support closing the wealth gap. Offering $50,000 grants to three winners, along with access to a wealth of tools and resources for continued entrepreneurial success, the program is open to Black entrepreneurs, small business owners (who have been operating their enterprise for five or less years), and CEOs. In its time, the initiative has supported 30 alumni, with over $450,000 in capital distributed.
Galaxy Grants
Women and minority entrepreneurs can benefit from the Galaxy Grants program, offered by the 501(c)(3) charity Hidden Star. This grant program, focused on improving the entrepreneurial journey for women and minority entrepreneurs, awards $2,750 to selected recipients. Hidden Star also offers entrepreneurs a second chance at the grant prize: If you share the Galaxy Grant with a friend and they win, you also receive a $2,750 grant for your business.
REI Navigate Program
The Navigate Program by REI is a four-month program that supports entrepreneurs from Black, Indigenous, Latino, and Asian American and Pacific Islander communities in the outdoor sector. The program combines financial assistance, personalized mentorship, and specialized access to REI’s resources in areas like product development, marketing, and distribution. All participants receive a $25,000 grant and additional investment options from a $30 million fund alongside opportunities to engage with customers and a robust network of mentors, investors, and industry leaders.
[Read more: 18 Business Success Tips from Black Entrepreneurs]
This story was originally written by Sean Ludwig and Emily Heaslip.
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