Investing in women of color is no longer just the right thing to do but also the smartest move for business. Essence Ventures is leveling the playing field for creators and women entrepreneurs of color through its creation of a $20 million Essence Creators and Makers Fund and the creation of the New Voices Venture Fund to provide monetary resources for existing and aspiring women of color entrepreneurs.
According to a recent article in Entrepreneur, only 20% of women are angel investors, less than 10% are venture capitalists and less than 5% of startups are female-led. Despite these numbers, black women entrepreneurs are the fastest-growing group of women-owned businesses. Additionally, a report commissioned by American Express on the state of women-owned businesses found that. Still, access to funding remains a huge barrier to minority women. Disparities in Capital Access between Minority and Non-Minority Businesses, a report released by the U.S. Department of Commerce’s Minority Business Development Agency, found that small business owners of color are more likely to be denied credit than other small business owners and also tend to pay higher interest rates.
Working to shift the narrative, New Voices Fund awarded $100,000 onsite via a pitch contest this past Saturday at the ESSENCE Festival. The winners of that pitch competition have not been publicly released yet, but we will update this story when they are revealed. Additionally, since the soft launch of the website in February, $30 million has been invested or committed to 8 companies. In total, there is $100 million dedicated to invest in companies through this fund.
[Richelieu Dennis, Founder and Chairman of Essence Ventures pictured with Queen Latifah.]
Similarly, creators and makers of color face challenges to securing financing for their projects. During the 2016-2017 broadcast network TV season, women accounted for only 28% of all creators, directors, writers, producers, executive producers, editors, and directors of photography working on the broadcast network, cable and streamline program. Richelieu Dennis, Founder and Chairman of Essence Ventures, explained, “The real value in content creation is ownership, and if you look at the funding challenges that creators and makers of color have – whether in film, television or other verticals – they are not getting the capital needed to develop projects.”
Dennis joined Queen Latifah at ESSENCE Festival this past weekend to announce the first partnership for the Essence Creators and Makers Fund with Flavor Unit Entertainment. Flavor Unit is a multimedia production company founded in 1990. Originally founded as a record label and management company, Flavor Unit now operates as a talent management and television and film production company.
New Voices Fund is leading the charge in investing where it makes the most sense – women and creators of color. We will all have to stay tuned to see how this trailblazing decision creates an impetus to change and reshape the world of funding.