Diversity in impact investment is critical for driving forward solutions that can benefit all groups of people. With Black History Month discussions taking place this February, it’s time to look at what the growing call for funding and support means for Black-owned businesses or Black entrepreneurs - and why diversity goes hand-in-hand with impact.
Paving the way for diversity
A recent study by Crunchbase revealed that Black startup entrepreneurs in the US only received 1.2 per cent of the record US$147 billion in venture capital invested in startups through the first half of 2021, despite 14 per cent of the country’s population being Black or African American. Black entrepreneurs in Canada also face significant challenge, with 76 per cent of them saying their race made it more difficult to succeed as a business owner according to a survey from Abacus Data. It is easy to get discouraged when the unequal gaps in funding and mentorship opportunities are so apparent, however, there are encouraging steps forward with the rise in diverse investment programs.
Over the past few months, we have seen a variety of investment initiatives aimed at bolstering Black entrepreneurship in the region. From the $221 million fund program led by the Canadian federal government together with national banks, to those led by private institutions focused on providing financial support, there is growing focus on providing mentorship and educational support to help remove barriers for Black-owned businesses.
The question of “why now” points to the pandemic’s disportionate effects on the Black community. With the move towards economic recovery being seen as a way to address the challenges raised by the 2020 racial justice movement, there is opportunity to create a more inclusive space for Black entrepreneurs and funders across North America.
EliteGamingLIVE brings inclusivity to STEM
This idea of equal opportunities is central to one of our portfolio companies: EliteGamingLIVE (EGL), a North American eSports company at the intersection of eSports and K-12 STEM education. Led by CEO and founder, Kerwin Rent, EGL paves the way for more diverse STEM representation by enabling equal access to education and training to K-12 students. The program is designed for passionate student gamers in Grades three to 12, offering a virtual eSports League that is fun and competitive, and inspires bright futures.
“Through EGL, we have been able to use technology and gaming to show all students, regardless of their background, their potential and to open up new possibilities for their future, particularly in STEM. This can also be translated to the world of entrepreneurship,” said Rent. “For entrepreneurs like me, it is important to see investors willing to take the time to support the growth of diverse businesses and founders, help us build connections and fund business ideas. I feel we have the backing to dream bigger with the Pollinator Fund, and race wasn’t a barrier for receiving their support and investment.”
The impact created when entrepreneurs have access to opportunities regardless of their background is far-reaching. For EGL, the enriching experiences created at the Academy help open doors for more young people from different communities to dream, consider, and pursue a career in STEM, an industry that has long dealt with a history of under-representation.
Creating a focus on diversity in our investment thesis
Our involvement with EGL demonstrates the Pollinator Fund’s belief in enabling inclusive communities through quality jobs and income, supporting work readiness, and care outcomes for vulnerable populations. We want to invest in the future we want to see, one that is built on both inclusivity and impact. This doesn’t just start with funding entrepreneurs from diverse communities that are advocating for inclusive solutions, but also reflecting this diversity within our team and across the broader TELUS network.
Among the Pollinator Fund portfolio companies, to date, 60 per cent of them are based in Canada, 50 per cent are led by Indigenous and racialized people, and 40 per cent are led by women. The companies continue to demonstrate an ability to advance opportunities for diversity and inclusion, leverage resources, networks and connections to grow their business, while also achieving strong financial returns.