The Black Economic Alliance Foundation (BEA), in collaboration with Wells Fargo, launched the Black Economic Alliance Entrepreneurs Fund to accelerate the growth of Black entrepreneurs and business owners. The $50 million evergreen fund will provide seed, startup, and early-stage capital to businesses founded and led by Black entrepreneurs.
The launch of the BEA Entrepreneurs Fund is anchored by Wells Fargo with a $20 million commitment over five years to kick-start operations and investments, and to serve as a thought partner to the BEA Foundation in building this innovative investment vehicle.
The BEA Entrepreneurs Fund will recycle 100% of returns to support ongoing operations and additional investments in Black-owned businesses and entrepreneurs.
“Business ownership has been one of the best paths to multi-generational wealth creation for some Americans, but too few Black entrepreneurs have secured the financial resources necessary to launch and grow successful businesses,” said David Clunie, executive director of the Black Economic Alliance. “The Black Economic Alliance is proud to marshal resources to support more Black-owned businesses and founders, which will leverage hiring more Black workers and additional investment in Black businesses and communities.
“We are thankful to Wells Fargo for providing $20 million in anchor funding to catalyze the launch of this important, long-term investment in Black entrepreneurs,” Clunie said.
Tony Coles, co-chair of the Black Economic Alliance and Executive Chairman and CEO of Cerevel Therapeutics, added that the BEA Entrepreneurs Fund will invest in a new generation of Black business leaders and entrepreneurs.
“The evergreen fund will help close the opportunity gap by enabling access to capital that promising business ventures need to grow,” Coles said. “We are grateful to Wells Fargo for helping to jumpstart this game-changing investment fund that will catalyze a pipeline of Black talent.”
Charles Phillips, co-chair of the Black Economic Alliance and managing partner and co-founder of Recognize, said that Black entrepreneurs too often struggle to access the capital they need to advance their businesses.
“The BEA Entrepreneurs Fund will allow Black business talent to strengthen their bottom line, which will reap other benefits such as hiring more Black employees, strengthening the communities they serve,” said Phillips, former CEO of Infor.
Phillips said having financial partners who recognize the importance of our mission is key to catalyzing this fund.
“We are committed to advancing racial equity in the communities we serve and beyond,” said Wells Fargo CEO Charlie Scharf. “The Black Economic Alliance Foundation is well positioned to develop a strong pipeline of entrepreneurs who can accelerate Black-owned businesses and economic growth across the United States. We look forward to bringing our capital and expertise to this important collaboration.”
BEA Entrepreneurs Fund investments will be made in the form of equity via convertible debt, by providing an equity stake in exchange for the seed capital investment.
The Fund will also make straight loans to Black startup businesses. All investments will be made available via a competitive application process, expected to begin later this year.
Once the BEA Fund begins investing, it will accept applications from all interested and eligible Black entrepreneurs across industries nationwide, including emerging business founders, alumni from historically Black colleges and universities, students, and participants in programs that focus on Black business development, among others.
The launch of the BEA Entrepreneurs Fund follows the announcement of the Center for Black Entrepreneurship (CBE), a joint venture among the Black Economic Alliance Foundation, Spelman College and Morehouse College.
The CBE will be the first-ever academic center of its kind to produce, train, and support a new generation of Black entrepreneurial talent. A portion of the BEA Entrepreneurs Fund will be earmarked to invest in CBE participants.
“Black Americans are woefully underrepresented in receiving venture capital funding, and we know it isn’t due to a lack of talent, ambition or ideas,” said Tia Breakley, BEA Board Member and Chief Strategic Development Officer and Chief Governance Officer at Blue Meridian Partners.
“Creating new avenues of access to capital for Black entrepreneurs will help lower the barrier to entry in the business world and allow Black founders to shine,” Breakley said. “I look forward to seeing the real and lasting impact the BEA Entrepreneurs Fund will have on our communities and talent pool.”
To learn more about the BEA Entrepreneurs Fund or the Black Economic Alliance Foundation, go to https://foundation.blackeconomicalliance.org/bea-entrepreneurs-fund.