WASHINGTON, D.C. (September 13, 2021) – The Black Economic Alliance Foundation (BEA), a leading national organization promoting economic mobility and prosperity for Black Americans, hosted a discussion on Clubhouse about the future of Black entrepreneurs and the resources and tools coming online to help them succeed. The discussion, Real Talk About Black Entrepreneurship, focused on the unique opportunities and challenges Black entrepreneurs face when launching their businesses.
The event, which drew in over 500 listeners, featured industry experts, successful entrepreneurs and academic leaders, including David Clunie (Executive Director of BEA), Dr. Mary Schmidt Campbell (President of Spelman College), Dr. David Thomas (President of Morehouse College), Kandace Anderson (CEO of Departmynt), Melissa Bradley (Founder of 1863 Ventures), Harold Hughes (CEO of Bandwagon), Bahiyah Robinson (Founder of VC Include), and moderator Chris Lyons, (General Partner at a16z and BEA Advisory Board member). Panelists discussed the experience of various emerging Black entrepreneurs in gaining access to capital and opportunity, and the considerable economic impact of growing the pipeline of Black innovation.
“Through the Black Economic Alliance Entrepreneurs Fund, we are going to make equity investments and also provide credit to fill the funding gap in so-called ‘friends and family money’ to start and scale a business that too many Black entrepreneurs don’t have access to,” said David Clunie, Executive Director of BEA.
Being successful in business takes luck, opportunity, and preparation meeting at the same time,” said Dr. David Thomas, President of Morehouse College. “One network that you can take advantage of is the alumni networks of HBCUs. At Morehouse, a significant number of alumni from ten years out have gone on to some kind of entrepreneurial venture.”
“The next generation of Black entrepreneurs need the knowledge base and tools to succeed. By establishing the Center for Black Entrepreneurship, we’ve introduced all kinds of new courses and new aspects of our curriculum into place,” said Dr. Mary Schmidt Campbell, President of Spelman College. “We’re also working more collaboratively with other colleges and universities to offer these resources to other schools through an online curriculum.
“I’ve found that connections with other entrepreneurs are the most helpful relationships for entrepreneurs to build at any stage,” said Harold Hughes, CEO of Bandwagon. “Most people want to meet investors, but some of the best advice usually comes from other founders.”
“It’s useful for any entrepreneur to understand how capital flows and how investments get made,” said Bahiyah Robinson, Founder of VC Include.
“You have to learn the language when you’re speaking about your business and your industry,” said Kandace Anderson, CEO of Departmynt. “[That learning comes through exposure to others in your field].”
“When you have two institutions [like Spelman and Morehouse investing in the next generation of entrepreneurs], hopefully it sends a message to other institutions [to follow suit],” said Melissa Bradley, Founder of 1863 Ventures.
In response to the known barriers to entry that Black entrepreneurs face, the BEA Foundation has partnered with Spelman College and Morehouse College to develop the Center for Black Entrepreneurship (CBE). The first-of-its-kind academic center aims to foster and equip the next generation of Black founders with the tools they need to succeed. The CBE will be the first-ever academic center of its kind to produce, train, and support a new generation of Black entrepreneurial talent.
Additionally, the BEA Foundation, with an anchor investment of $20 million from Wells Fargo, launched the Black Economic Alliance Entrepreneurs Fund (BEA Entrepreneurs Fund) to accelerate the growth of Black entrepreneurs and business owners. The $50 million evergreen fund will provide seed, start-up, and early-stage capital to businesses founded and led by Black entrepreneurs. The BEA Entrepreneurs Fund will recycle its returns to support ongoing operations and additional investments in Black-owned businesses and entrepreneurs. A portion of the BEA Entrepreneurs Fund will be earmarked to invest in CBE participants.
Studies have shown that successful business ownership has been one of the most effective paths to wealth creation and economic security for Americans but securing the necessary financing to do so often proves to be the greatest roadblock to success—especially for Black entrepreneurs. According to the Harvard Business Review, before 2020, Black founders received roughly 1% of venture capital financing. Reuters reported that even after the unprecedented influx of investment into Black causes over the past year, only approximately 3% of the $147.6 billion venture capital deal volume in 2020 went to Black-founded companies. And data released by the Federal Reserve in 2020 showed that only 26% of Black business owners received the full amount of financing they sought from banks, which is a small fraction compared to a little over 54% of white business owners, 33.8% for Asian business owners, and 32% for Latinx business owners.
About the Black Economic Alliance Foundation
The BEA Foundation works with leaders in the private, public, and nonprofit sectors to produce, research, and analyze data to diagnose the obstacles to Black economic mobility and prescribe practical solutions to create better access to good-paying jobs, a living wage, and wealth creation for Black people. The BEA Foundation also crafts programs that convene leaders across industries around initiatives that will produce better economic outcomes for Black people. The BEA Foundation is the 501c3 charitable nonprofit affiliate of the Black Economic Alliance, a coalition of Black business leaders and allies committed to driving economic progress for the Black community with a focus on work, wages, and wealth. For more information, visit: foundation.blackeconomicalliance.org