Image: WOC in Tech Chat
Even for those of us who only understand venture capital from what we watch on Shark Tank can conclude that getting funding for your startup isn’t an easy task.
What’s more frustrating than any good idea not getting funding, is knowing that women and especially women of color are less successful than men in securing funding for their entrepreneurial ventures. Black women are the most educated and entrepreneurial group in the country, and they still receive less than 1 percent of venture capital. Global financial services firm, Morgan Stanley, is looking to change how women of color are supported in technology.
This month, Morgan Stanley launched the Multicultural Innovation Lab, aimed at helping technology-enabled startups with women of color, and females as founders and CTOs. Women of color have tremendous potential in profitability, and innovation to disrupt industries, but often are not given the chance to prove themselves to investors. Black women own 1.5 million businesses that bring in about $44 billion per year.
The four month accelerator program will support startups in the post-seed to Series A funding rounds, using internal and external resources. Series A funding is when investors are putting their money into companies that have already been seeded or if the company has already raised at $2-3 million. Seed funding on the other had can be considered anything from $500k to $1.5 million, although is less common these days.
“By specifically catering to top high growth multicultural entrepreneurs, The Lab addresses the market inefficiency to accelerate their business and maximize economic outcomes,” said Carla Harris, Vice Chairman, Global Wealth Management, and Head of the Multicultural Client Strategy Group, Morgan Stanley.
The Lab gives access and visibility to multicultural and women entrepreneurs who have the potential to make real change and disrupt their industries. With many people of color and women not having access to stakeholders who can help turn the tide in their entrepreneurial journey, the Lab is looking to change all of that. One of the goals of the program is to drive positive economic outcomes for people of color and other underrepresented groups in tech, through content, technical support and connectivity.
How will this program help support their participants? They’ve brought on board, William Crowder, former head of Comcast Ventures, as their Entrepreneur-In-Residence. Crowder will help create content, and work in collaboration with the Multicultural Client Strategy team to help the entrepreneurs overcomes their unique challenges.
The entrepreneurs move their operations into Morgan Stanley’s Time Square office until November, when they then have the chance to pitch to investors at the Morgan Stanley Symposium.
“If they look back and are able to say ‘wow, these last three months here were invaluable and I’m now ready to go onto the next stage of venture capital financing,’ then it’ll be a success,” expressed Alice Vilma, Executive Director, Multicultural Client Strategy Group.
The Lab however isn’t just for women, it’s for all multicultural and underrepresented entrepreneurs. With multicultural startups getting less than 3 percent of venture capital funding, Morgan Stanley’s Innovation Lab will be filling quite the gap for these lucky entrepreneurs.
“I come from a middle-class African American family in Philly. I’m not that guy from an affluent family who went to an Ivy League school and has a huge college network of friends in banking and hedge funds,” said Brian Brackeen, founders of artificial intelligence startup Kairos.
You can learn more about the Multicultural Innovation Lab here, and how you can be in the next class of the accelerator program.