20 Funding Sources for Black-Owned Businesses in 2023
This post is a cross post from DownloadAstro, Str8jacket doesn’t own the right of the content.
Many African American small business owners face challenges with funding due to post-pandemic hardship, inflation, and fierce competition. Yet black-owned businesses have been integral to the U.S. economy in the past and present.
To help you out, we’ve rounded up a list of 20 places where you can seek grants and funding for your business in 2023.
Backstage Capital
What’s cool about Backstage Capital is that they intentionally back underrepresented founders, particularly those of color, female genders, and LGBTQ orientations. Founded in 2015, this private firm set out to support early-stage startups that traditional venture capitalists often overlook. It has since funded 200 startups, most of which are based in the United States.
One of the key initiatives of Backstage Capital is its interest in helping its portfolio companies grow. Rather than give out one-off grants, the firm sources for equity rounds, convertible notes, and Simple Agreements for Future Equity (SAFEs) from its accredited investors.
Besides investment, Backstage hosts events and provides opportunities to network with mentors, investors, and industry experts.
Community Development Financial Institutions (CDFI) Fund
The CDFI Fund is a public funding source designed to empower CDFIs servicing America’s underserved and distressed communities economically. This Fund provides various programs to support CDFIs, including the CDFI Bond Guarantee Program, which has guaranteed over $2 billion worth of bonds so far.
CDFIs are financial institutions such as banks, credit unions, loan funds, microloan funds, or venture capital providers that provide residents and businesses loans funded by the U.S. Treasury Department to create economic opportunities in low-income communities.
To become certified as a CDFI, a financial institution must apply to the CDFI Fund and meet certain criteria. These include having a primary mission of promoting community development and being a financing entity.
The CDFI Fund isn’t exclusively for black-owned CDFIs. But it does encourage CDFIs in low-income communities by helping them with grants, tax credits, and loan services. This empowers the CDFIs to give people in those communities loans to open businesses, buy homes and so on, improving their living standards.
Grants.gov
Grants.gov is a federal website that provides a centralized location for grant seekers to find and apply for funding opportunities. While Grants.gov offers a wide range of funding opportunities for businesses of all types, they do not specifically target Black-owned businesses.
Some of these programs may focus on promoting economic development in historically underserved communities or supporting small businesses in certain industries.
Please remember that Grant.gov doesn’t disburse grants. Rather, grantors can advertise grant opportunities to potentially interested communities on Grant.gov, urging them to submit their applications.
Reign Ventures
Reign Ventures is a private venture capital fund that invests in startups led by women and minorities. They focus on companies in the tech industry that have high-potential founders.
Reign doesn’t stipulate specific periods during which interested business owners can pitch their ideas to the board of investors. You’re welcome to send your pitch to them at any time.
IFundWomen of Colour (IFC)
IFC is the perfect platform for female coloured entrepreneurs to raise capital through crowdfunding, grants and coaching. If you choose IFC, you can access its exclusive Slack community, where you can share your business strategy and learn more about branding and marketing.
IFundWomen also provides opportunities for women to learn from expert workshops and enlist the services of coaches to assist them on their business growth journey.
To crowdfund your business, start by taking IFC’s crowdfunding course and supporting other campaigns. Then download the grant planner to map out exactly how you intend to get the capital you need from crowdfunding.
For full content, please visit DownloadAstro’s post here
