After Fearless: What’s Next for Women of Color in Business?
Photo Credits: Time
The Fearless Fund, a venture capital fund based out of Atlanta, permanently closed its grant contest in September of this year after a year-long battle over a racial discrimination case. The Fearless Fund was a grant program created to award upwards of $20,000 to small, women-of-color-owned businesses. The Fearless Fund worked to “bridge the gap in venture capital funding for women of color founders building scalable, growth-aggressive companies.” This fund served as a leading light for many small businesses owned by women of color, such as The Lip Bar, Range Beauty, and Slutty Vegan.
Starting in August of 2023, the American Alliance for Equal Rights (AAER), a nonprofit membership organization, filed a complaint against the Fearless Fund and all of its related entities, claiming that the basis of the grant program directly violates 42 U.S.C Section 1981. This federal statute was enacted during the Civil Rights Act of 1866 and was made to prohibit racial discrimination when making or enforcing contracts. The statute originally states that “to the full and equal benefits of all laws and proceedings for the security of persons and property as is enjoyed by white citizens” and was intended to provide legal protections for Black people who were facing widespread discrimination. However, in recent cases, this statute has been used and interpreted differently by courts and has since been made to protect people of all races when it comes to contractual information and enforcement.
The permanent closing of The Fearless Fund not only speaks highly of the climate of venture capital for women of color but also shows the importance of safe spaces and communities for these women business owners. It is not only important to continue to foster these communities but also to fight for these communities. With The Fearless Fund founder, Arian Simone, making the decision to close to avoid a court ruling that could, in turn, end minority-based funding nationwide, it is apparent the risk at hand for women of color in this field.
You may be asking, what does this mean for the future of women of color in venture capital? While the outcome of this case has initiated conversations amongst other venture capital firms about their Diversity, Equity, and Inclusivity tactics, it has not completely eliminated the conversation topic. If anything, it has sparked a new conversation on how to support minority businesses and protect them, ensuring that other funds and organizations will not have to face the same dilemma as The Fearless Fund.
Through the case judges in these states decided that the Fearless Fund’s grant program likely broke a law called Section 1981. Section 1981 of the Civil Rights Act of 1866 is a federal law that bans racial discrimination in contracts. Originally created to protect Black people after emancipation, it now applies to all races. The American Alliance for Equal Rights (AAER) sued Fearless Fund under this law, which requires the existence of a contract to make a claim. This claim could affect the states of Alabama, Florida and Georgia and it is important for venture capital in these states to understand how to move forward.
While this loss is a tremendous blow to the age-old fight for women of color business owners, it is not the end of the fight. It is important for all to not only be in the know about detrimental decisions and cases like this one but also to be openly speaking and communicating to ensure that the severity of this loss does not happen again.
That is why events such as the Simply Together Holiday Brunch hosted by WOC Worldwide and sponsored by Simply are so important. This event, hosted at the Del Mar restaurant in Washington D.C on December 7th featured women of color from all industries coming together to discuss the impact of grants and funds to their business. As well as touching on the importance of staying resilient even after being told “no”. CEO and co-founder of Kazmaleje, Latoya Stirrup was the guest speaker and attendees had the opportunity to learn more about what it takes to be a black owned and operated business.
Women from all fields of work were able to come together and network, learn and grow from one another. A vital part to keeping our community together and strong, even when there are forces trying to knock us down. WOC Worldwide is dedicated to ensuring the strength of our community and voices. Subscribe below today to stay up to date with all upcoming events, blogs and content from WOC Worldwide.
