TLDR:
- Fearless Fund has dropped its grant program for Black women business owners as part of a settlement agreement with a conservative group.
- A federal appeals court ordered the suspension of the Strivers Grant Contest, which provided $20,000 to businesses owned by Black women.
A venture capital firm, Fearless Fund, has closed down a grant contest for Black women business owners as part of a settlement agreement with a conservative group that had filed a lawsuit alleging the program was discriminatory. The settlement came after a federal appeals court ordered the Fearless Fund to suspend the Strivers Grant Contest, which provided $20,000 to businesses that are majority owned by Black women. The court ruled that the American Alliance for Equal Rights was likely to prevail in its lawsuit claiming that the program illegally discriminated on the basis of race.
The lawsuit against the Fearless Fund has been closely watched as a bellwether in the legal battle waged by conservative groups against corporate diversity programs. The settlement was reached to avoid setting a precedent that could eliminate race-based funding, according to civil rights attorney Ben Crump, who represented the Fearless Fund. The Fearless Fund has stated that the settlement will not affect its investments or other activities.
In response to the settlement, conservative activist Ed Blum, who led the lawsuit, expressed hope that race-exclusive programs would be stopped and opened to everyone regardless of race. The Fearless Fund has announced a new $200 million debt fund that will offer loans to under-resourced founders in an effort to continue supporting women of color entrepreneurs. The decision to settle the lawsuit was influenced by the potential adverse rulings in ongoing legal battles and the conservative majority in the Supreme Court.
