The Fearless Fund a venture capital fund devoted to funding Black women-owned businesses, founded by two FAMU graduates, on Thursday defended their efforts to support underrepresented entrepreneurs in the face of a lawsuit by a conservative activist accusing it of racial discrimination.
The group has enlisted prominent civil rights attorney Ben Crump and pledged to fight a lawsuit filed last week by a conservative affirmative action opponents who led the successful U.S. Supreme Court challenge to the consideration of race in college admissions to promote diversity.
The lawsuit was by the American Alliance for Equal Rights, a group founded by activist Edward Blum, who through another organization pursued the cases against Harvard University and University of North Carolina that led the Supreme Court in June to end affirmative action in higher education.
"We are not scared," Arian Simone, the chief executive and co-founder of the Atlanta-based Fearless Fund, said. "We are fearless."
According to the Fearless Fund, women of color business founders in 2022 received only 0.39% of the $288 billion that venture capital firms deployed. The fund aims to remedy that and counts as investors JPMorgan Chase, Bank of America and MasterCard.
The news conference was part of the fund's first public response to the lawsuit, which alleged it unlawfully allowed only Black women small business owners to be eligible for a competition that awards $20,000 in grants and other resources.
"I think it's going to be a stretch to explain why Hispanic and Native American women are not eligible, as well as Asian and white women," Blum said on Thursday.
Alphonso David, a civil rights lawyer who has joined Fearless Fund's defense, criticized the lawsuit's "cynical" claim that the fund violated Section 1981 of the Civil Rights Act of 1866. The law, barring racial bias in private contracts, was adopted after slavery was abolished in the U.S. Civil War's aftermath.
"This is a frivolous attempt to prevent progress from winning," said Crump, a member of the defense team, which is led by the law firm Gibson, Dunn & Crutcher.