Written by Thom Ruhe, President and CEO, NC IDEA Foundation
Data shows that the more diverse our entrepreneurial ecosystems become, the more resilient our economy will be, much in the way a diversified investment portfolio is common sense.
More growth-oriented Black-owned firms means more innovation, more jobs and significantly more wealth creation for Black people, impacting communities as a whole. However, the number of Black-owned firms is disproportionately low at nearly every stage of development. This Black entrepreneurship gap is due to systems that result in a lack of access, exposure, networks, funding and resources.
This is the challenge statement as written in the charter of the North Carolina Black Entrepreneurship Council.
A Call to Action
In August 2020, NC IDEA created the North Carolina Black Entrepreneurship Council (NC BEC) to lead the Foundation in its programmatic and grant making ambitions to address the challenges of Black entrepreneurship in North Carolina. Council members work closely with NC IDEA to identify, recommend and support partners and programs with the expressed purpose to serve the entrepreneurial aspirations and economic potential of North Carolina’s Black community, including guidance in the Foundation’s funding decisions.
We were humbled by the interest in the Council after announcing a public call for members. We assembled an inaugural group of 25 individuals (from over 150 that raised their hand) represented by a diversity of viewpoints and experiences from throughout North Carolina; specifically, a mix of leaders in the Black entrepreneurial ecosystem, as well as successful Black entrepreneurs; individuals with evidence of engagement and a personal commitment to equity and inclusion.
The formation of the Council coincided with a commitment by the NC IDEA board of directors that the Foundation would manage operating budgets for the next two fiscal years of at least 10% of net assets; namely, twice the minimum amount required by law. The resulting increase in programmatic spend afforded an initial $500,000 budget under the auspice of the newly formed Council.
The Meaningful Work
Under the leadership of the NC BEC and just months after its formation, the call to fund organizations supporting more Black people in their ambition to start and scale growth-oriented companies drew an incredible response of 140 applications. NC IDEA awarded over $360,000 in ECOSYSTEM grants to eight entrepreneur support organizations to create greater opportunity to economically empower Black people with entrepreneurship, and collectively work to combat inequalities that perpetuate racial imbalances. In the Spring of 2021, the Council awarded smaller ENGAGE grants of $10,000 each to 14 organizations across the state executing on innovative and transformational ideas to elevate Black Entrepreneurship.
The activities of the Council drew the attention from outside funders looking to support equitable economic development. In 2021, NC IDEA received two of its largest charitable contributions from The Wege Foundation and Research Triangle Foundation allowing the Council to extend the impact of its meaningful work and award grants to an additional six ECOSYSTEM partners. Even more validating, the NC IDEA board granted a second tranche of $500,000 to be managed under the direction of the NC BEC.
In early 2022, eager to directly address the inequities in fundraising that Black startup entrepreneurs face while scaling their companies, the Council launched a new program to provide GROWTH grants of $75,000 each to Black-founded NC IDEA SEED companies (companies previously receiving one of NC IDEA’s longest standing grants of $50,000 direct-to-entrepreneur). Recipients were required to have at least one founder actively working at the company identifying as Black or African-American and must also have made significant progress beyond the NC IDEA SEED stage. These unprecedented grants were awarded to seven Black-founded former NC IDEA SEED grant recipients for a total of $525,000 in funding.
What’s Next
Since its inception, the NC BEC has awarded funding to 28 partners through ECOSYSTEM and ENGAGE grants, and 7 companies through GROWTH grants.
Earlier this summer, the NC IDEA board committed another half a million dollars of its budget, further expanding the funding and programmatic capacity to accelerate and amplify the activities of the NC BEC. Along with outside funding, this brings the total financial commitment of the NC BEC in just under 2 years to nearly $2 million. It is our hope as we build a new model for inclusive and equitable economic development, similar coalitions in other states will join our efforts to work with a common purpose toward narrowing the racial gaps in economic empowerment of the Nation’s Black population.
We remain steadfast in the belief that our greatest natural resource is the entrepreneurial potential of everyone and not just the lucky few with privilege and access. Learn more about NC IDEA and the great work of the North Carolina Black Entrepreneurship Council at www.ncidea.org.