By: Rhett Buttle
On March 1, Vice President Kamala Harris announced that awards to ten minority and women-led venture capital firms in Durham, North Carolina’s Historic Black Wall Street will receive a $32 million federal investment. The awards are projected to kickstart more than $90 million in overall investments to early-stage small businesses in the state. These funds coming from the American Rescue Plan are part of an effort to make equity capital investments available to historically underserved small businesses and entrepreneurs.
This announcement by Vice President Harris, Deputy Secretary of the Treasury Wally Adeyemo, and North Carolina Governor Roy Cooper of funding awarded through the State Small Business Credit Initiative (SSBCI) is expected to lead to an additional $60 million in private investment. The SSBCI helps make this type of investment possible. Originally established in 2010, it provides funding to states, the District of Columbia, territories, and Tribal governments for programs to increase lending and investing in small businesses. The American Rescue Plan expanded the SSBCI to provide $10 billion in support and is expected to catalyze up to $10 of private investment for every $1 of SSBCI capital funding.
You may be asking how this kind of private investment can happen. The answer in North Carolina and other states is that the awardees of SSBCI funding are also committed to and skilled in raising the private funds. For example, one of the recent recipients, Symphonic Capital, is an early-stage fund that invests in companies closing access gaps in health and wealth. Another venture firm, Wocstar Capital, is focused on creating wealth in communities of color by championing and training women of color entrepreneurs and diverse tech teams.
RevTechLabs is a majority female and Latina-owned entrepreneurship center and accelerator that will invest in over 200 early-stage companies with traditionally underrepresented founders in financial, health, and insurance technologies. In addition, LeVert Ventures is an early-stage venture capital fund that will invest in next-generation technologies that have the potential to transform the agricultural technology industry.
Black business ownership is growing at the fastest pace in 30 years and there have been more small business applications in the past three years than in any other three-year period in American history. Investments like this one in North Carolina and other states can help continue to foster this success.
Vice President Kamala Harris visited Durham on Friday to announce the Biden-Harris administration’s plan to invest $92 million in early stage startups in North Carolina. The visit was part of the administration’s Investing in America tour.
Harris said the Biden-Harris administration has been intentional about the work it is doing to invest in communities.
Harris said $32 million in federal funds will go towards 10 North Carolina venture capital firms under the Treasury Department’s State Small Business Credit Initiative. This includes RevTech Labs, a majority female and Latina-owned entrepreneurship center; LaVert Ventures, a woman-owned AgTech fund; and Nex Cubed, which houses a historically Black colleges and universities founders fund for HBCU alumni to launch entrepreneurial endeavors.
This investment will propel an additional $60 million in private investment in North Carolina, totaling $92 million in funds being dedicated to growing small businesses.
Gov. Roy Cooper welcomed Harris to the state for the 10th time during her term as vice president.
The event took place on Durham’s historic Black Wall Street. Cooper opened the remarks with a statement on the importance of investing in minority-led businesses.
“There are a lot of smart people with great ideas and a work ethic who, with some capital investment, can start a successful business,” Cooper said. “Yet in the private sector, Black-led companies receive only 1% of venture funding, and only 2% of venture funding goes to women.”
Cooper said the Biden-Harris administration has done important work in expanding opportunities for everyone, especially underserved and underutilized businesses, citing the creation of 2.6 million jobs for Black workers.
Harris underscored Cooper’s emphasis on providing communities with adequate resources and access to opportunity.
“That is the map in terms of what we are talking about,” Harris said. “It is about meeting the capacity of communities with the resources that are necessary to strengthen our economy, and we all benefit from that.”
Harris said this announcement is consistent with her and Biden’s campaign promises.
“Many of you may know, the president and I, from the beginning of our administration, made a pledge — which we are on track to meet — to increase by 50% federal contracts going to minority-owned businesses,” Harris said.
Harris said more federal contracts going towards minority-owned businesses is the right thing to do, but also makes financial and economical sense.
“Because the bottom line — and yes, the bottom line, I speak in economic terms — is that this produces an extraordinary return on investment,” Harris said. “And that is as much as any other reason why we are doing this work together with our partners.”