Social entrepreneurs of color can find it particularly challenging to access sources of funding. Programs that provide funding to minority entrepreneurs along with the network and leadership development necessary to sustain their businesses contribute to the closing of this gap.
Prior to Echoing Green, we struggled to articulate our work – and ultimately had a difficult time acquiring funds. Our Echoing Green Portfolio Manager helped us create a clearer message around impact and improved our ability to communicate our work to funders.
Social entrepreneurs of color often don’t have access to the networks and social capital that would allow them to fundraise and gain credibility in investment circles. Additionally, many entrepreneurs focusing on complex social challenges that deal with issues of race and class struggle to communicate their business models and value proposition. As a result, the funding challenges that many early-stage entrepreneurs face are amplified for entrepreneurs of color.
Echoing Green’s Black Male Achievement (BMA) fellowship aims to disrupt the status quo in which entrepreneurs of color lack access to funding and investor networks. This process starts even before someone is accepted into the program, with targeted recruiting and support throughout the application process. Once accepted, the two-year fellowship provides entrepreneurs with a Leadership Development Framework that builds 10 core competencies including theory of change, fundraising planning, and measurement and evaluation. Importantly, Echoing Green’s portfolio managers, who work directly with the entrepreneurs, have deep subject matter expertise and personal experience with the issues that BMA fellows are trying to address, allowing for more specific and contextualized support. Coupled with seed funding and the access to networks through the “stamp of approval” provided by Echoing Green, the BMA fellowship helps entrepreneurs of color solve for a lack of funding and access to networks from multiple angles.
Alex Peay and Mubarak Lawrence, 2016 BMA fellows and co-founders of social enterprise One’s Up, entered the fellowship having worked hard to further their goal of driving economic growth for opportunity youth. However, they had never thought through how to articulate their theory of change to funders and communicate their venture’s value. Through the BMA fellowship, Peay and Lawrence were able to work with a portfolio manager to think through how to “sell” their story. More broadly, Echoing Green is considering how to work with philanthropists, investors, and the broader social impact community to have more engaged conversations around race and social entrepreneurship.
How it applies to your city:
Enablers should develop programs that take into account the specific needs and barriers to entry for entrepreneurs of color – from the application process on. Funders and investors can also consider how to be more intentional about their investments and set specific goals to help reduce the funding gap for entrepreneurs of color.