When it comes to starting a business, securing capital is often one of the greatest challenges for Black entrepreneurs. Less access to banking in Black communities and a history of discriminatory lending practices have made it harder for Black founders to secure loans or financial assistance.
And once your business is open, unexpected disasters like a pandemic can wreak havoc on even the most established business’ bottom line. While many businesses struggled in 2020 due to the impact of COVID-19, Black businesses were hit even harder.
According to a Stanford report on the impact of COVID-19 on small business owners, between February and April 2020 there was a 41% drop in the operation of Black-owned businesses. The fallout from the pandemic left many businesses urgently seeking funding to stay open.
The need for sustainable funding resources is an urgent need to support the future of Black businesses. In recent years, a number of nonprofits, private equity firms, and grant programs have developed with the sole focus of supporting Black businesses.
This guide compiles the top resources to fund your business with programs for loans, grants, and private equity firms known to support Black-owned businesses. Whether you’re looking to scale up or get started, there’s a resource for you.
While this list has been compiled with the intention of helping Black business owners, many of the financial programs are also open to non-black people of color, and those with other marginalized identities, such as veterans, women, and the LGBTQ+ and disabled communities.
Funding Resources for Black-Owned Businesses
Accion International is a global, non-profit micro-lender that provides financing to disadvantaged populations. They connect low-income entrepreneurs, entrepreneurs of color, and women to affordable capital, educational resources, coaching, and business networks.
Accompany provides affordable capital, financial education, and training for immigrant and refugee entrepreneurs in New York City.
Community Development Financial Institutions Fund
This fund is part of the U.S. Treasury Department. CDFIs are financial institutions such as banks, credit unions, loan funds, microloan funds, or venture capital providers.
These institutions provide local residents and businesses loans funded by the U.S. Treasury Department to create economic opportunity in low-income communities. Head here to find a local CDFI in your neighborhood that can provide business assistance.
DreamSpring is a nonprofit serving entrepreneurs in Arizona, Colorado, Nevada, New Mexico and Texas. They offer access to credit, loans, and provide support to help you re-start and re-open your business.
EnrichHer is a fintech platform that offers small business loans for women-owned businesses. Their Accelerator + Portfolio Match program is open to Black-owned businesses across the United States.
Founders First Capital Partners
Founders First Capital Partners offers flexible revenue-based investments for service companies led by minorities, veterans, and women founders, with a focus on preserving business ownership. In addition to investments, they offer business accelerator programs and a learning platform that can help business owners.
This nonprofit online lending platform that connects entrepreneurs to crowdsourced lending. Their unorthodox lending program can be a fit for nontraditional borrowers.
National Minority Supplier Development Council
National Minority Supplier Development Council is a corporate member organization with a mission to advance business opportunities for minority businesses. They offer a Business Consortium Fund where eligible businesses can receive financing and advisory services.
Pursuit Lending is a financial organization serving business loans to New York, New New Jersey, and Pennsylvania. They have more than 15 loan programs, including programs to help you start a business and develop working capital.
This investment firm provides Black, Indigenous, and People of Color (BIPOC) entrepreneurs in the Bay Area, Northern California, and Massachusetts with early-stage funding and holistic business support. Their program includes”friends and family” style funding, weekly coaching, and access to a network of other entrepreneurs of color in their portfolio.
Small Business Administration (SBA)
The SBA is a U.S. government agency that provides support to small businesses and entrepreneurs. Whether you’re looking for investment capital or a loan, they can match you to the right programs and products to help your business.
If you’re looking for help keeping your business open in light of COVID-19, look into their Paycheck Protection Program. Their new guidance aims to prioritize minority-owned businesses among other underserved communities.
Union Bank is committed to serving underserved communities with theirDiversity Lending program. This program is designed to support minority, women, and veteran business owners with flexible credit guidelines and access to capital.
Business For All
Business For All is a grant program offered by Hello Alice in partnership with Verizon. This program offers 18 total grants comprising $285,000 to Business for All applicants. Thirteen of the 18 grants will go to businesses led by women, people of color, LGBTQ+ entrepreneurs, military connected business owners, and entrepreneurs with disabilities.
The FedEx Small Business Grant Contest
This annual competition held by FedEx is opening on February 16, 2021.. The competition awards grants and FedEx services to 12 winning businesses. While the contest is not exclusively for entrepreneurs of color, several minority owned businesses have been past winners.
This database displays all the federal grant programs from every eligible U.S. agency. If you are looking for government grants, this portal will be your guide.
iFundWomen is a crowd-funding platform for women owned businesses. They offer an exclusive program for women of color, as well as access to grants, guides to crowdfunding, business coaching, and support.
Minority Business Development Agency (MBDA)
The MBDA is an agency of the U.S. Department of Commerce that promotes the growth of minority-owned businesses. They do not directly disburse funds, however MBDA Minority Business Centers can connect you to the right resources for capital.
The National Association for the Self-Employed (NASE)
The NASE offers a Growth Grants Program with micro-grants up to $4,000 to the organization’s members. This program is not specifically for Black business owners but may be ideal for small business owners looking for alternative funding.
Shea Moisture Women of Color E-Lab
This e-learning platform for women of color entrepreneurs offers education, access to resources, and mentorship in response to the COVID-19 crisis. After program completion, participants will have an opportunity to develop a pandemic business recovery plan and pitch for $100,000 in funding.
The Small Business Innovation Research (SBIR)andSmall Business Technology Transfer (SBTT)
These grants are powered by the Small Business Administration, and fund a diverse portfolio of startups and small businesses across technology areas and markets to stimulate technological innovation, specifically in research and development. Entrepreneurs of color, women, and people with disabilities living in the United States and U.S. territories are encouraged to apply.
The USDA Rural Business Development Grant Program
This grant program is for eligible small businesses operating in rural areas who seek to improve their community.
Private Equity Firms
Backstage Capital, led by Managing Partner and INBOUND speaker Arlan Hamilton, invests in companies led by underestimated founders, including women, people of color, and LGBTQ+ founders. They welcome businesses at any stage to apply and have invested in more than 150 companies.
Collab Capital is an investment fund supporting Black founders to build sustainable, innovation-centered businesses.
DivInc offers accelerator programs with non-dilutive seed funds for qualified underrepresented founders.
Harlem Capital Partners
This New York City-based venture capital firm is on a mission to change the face of entrepreneurship. Harlem Capital Partners has set a lofty goal to invest in over 1,000 diverse founders over the next 20 years. They focus on disruptive companies solving important problems.
Hello Alice Black-Owned Business Center
This online database compiles active funding opportunities and resources for Black businesses.
Humble Ventures is a private equity firm investing in diverse founders and organizations.
Kapor Capital is an impact investment fund committed to investing in diverse entrepreneurs creating large scale social impact. They’re looking for diverse tech-driven companies focused on closing opportunity gaps.
New Media Ventures
New Media Ventures is a seed fund and national network of angel investors focused on entrepreneurs and activists seeking innovative approaches to progressive change.
Oakland Black Business Fund
This investment platform provides grants and investments to Black-owned businesses in Oakland, CA with the goal of addressing gaps in access to capital and real estate. In addition, OBBF has a $10M relief fund to help Oakland businesses impacted by COVID-19.
Other Actively Investing Funds
Provided by Backstage Capital, this resource lists several active investing funds for underrepresented founders.
As we uncover more resources for underrepresented founders we’ll continue updating this list. For more information to help you launch and run your business, check out this post.