Fearless Fund Ends Grant Program for Black Women Entrepreneurs After Anti-DEI Lawsuit Settlement

Fearless Fund, an Atlanta-based venture capital firm focused on supporting women of color, announced it will permanently close its Fearless Strivers Grant program for Black women business owners. This decision comes after a settlement was reached with conservative activist Edward Blum, who has been involved in legal challenges against race-conscious policies.

In a court filing on Wednesday, attorneys for both Fearless Fund and Blum’s group, the American Alliance for Equal Rights, stated that they have “settled” and asked the court to dismiss the case. As part of the settlement, Fearless Fund agreed to shut down its grant contest, which had been awarding $20,000 to small businesses led by at least one woman of color.

The American Alliance for Equal Rights, founded by Blum, issued a statement confirming the closure and noted that they had encouraged Fearless Fund to open its contest to women of all races. However, the fund chose to discontinue the program altogether.

Alphonso David, one of the attorneys representing Fearless Fund, described the settlement as a “positive outcome” for the firm. He emphasized that the agreement is limited in scope and does not impact any of the fund’s other investment or charitable activities, allowing them to continue working toward expanding economic opportunities.

The legal dispute over the Fearless Strivers Grant was one of the notable cases concerning affirmative action and diversity programs. In August 2023, Blum’s group filed a lawsuit against Fearless Fund, claiming the grant was discriminatory against non-Black business owners. The case attracted attention during a time when diversity and inclusion initiatives have faced heightened legal scrutiny.

The Fearless Fund received support from the National Venture Capital Association, which filed an amicus brief defending the grant program as a necessary step toward creating equal opportunities for Black women. A study by Deloitte and Venture Forward found that in 2022, only 2% of investment professionals at venture capital firms were Black women.

However, in June, a U.S. federal court of appeals suspended the Fearless Fund’s program in a 2-1 decision, reversing a lower court’s ruling that had allowed the grant contest to continue. The appeals court indicated that the lawsuit had a likelihood of success based on arguments that the program’s criteria excluded individuals based on race.

Blum, a long-time critic of race-conscious policies, has been involved in numerous lawsuits challenging affirmative action. In 2023, he achieved a major victory when the Supreme Court ended race-based admissions in higher education.

The settlement with Fearless Fund reflects a trend where companies and organizations face increasing legal challenges over diversity-focused programs. The American Alliance for Equal Rights has also filed lawsuits against other entities, such as Southwest Airlines, Amazon, Meta, and the Smithsonian’s National Museum of the American Latino, over similar concerns. While Fearless Fund will not reopen its grant program, it remains focused on continuing its mission to support economic opportunity within the current legal landscape.