Black startups get more than $500K from NC IDEA seed grant

DURHAM

NC IDEA, one of the state’s leading foundations for supporting startup businesses, is giving more than half a million dollars in grant money to seven Black-led startups across the state.

The new funding comes out of an initiative the foundation launched in the wake of George Floyd’s death in 2020.

Black-led startups still receive just a small fraction of funding compared to other startups — even as venture capital funding levels hit record heights in the state last year. One study put Black startups’ share of venture capital money at just 1.2% for the first half of 2021, Crunchbase reported.

In an effort to make sure the foundation was identifying promising Black entrepreneurs, NC IDEA created the Black Entrepreneurship Council, a Black-led board that is directing some of the foundation’s outreach to the state’s Black business community.

“Having a more inclusive applicant pool is important,” said Thom Ruhe, CEO and president of NC IDEA. “And we’ve been trying to do that for the last couple years, really focusing on increasing the number of Black founders that apply.”

Ruhe noted that a lot of companies start with a cashed-out 401(k) or tapping into a home equity line. “Some of my earliest companies, I funded through taking loans against existing 401(k)s or through my home equity line that I had,” he said. “But a lot of Black founders don’t have those resources.”

After working with the council, NC IDEA identified seven startups eligible to receive the seed funding, valued at $75,000 for each company.

Companies receiving the seed grants were:

Courtroom 5

Courtroom5, a Durham-based company started by professors Sonja Ebron and Debra Slone, aims to help those who can’t afford lawyers in civil cases.

Every year in this country, millions of Americans head to court without a lawyer, even though it leaves them at a distinct disadvantage in many cases. In some states, up to 80% to 90% of civil cases involve an unrepresented litigant — and often they are low-income or a member of a vulnerable population, a 2015 study from the George Washington University Law School found.

Courtroom5 operates as a management platform for people who choose to represent themselves in court. The company’s platform offers a step-by-step guide to navigating civil cases, helps litigants know what paperwork or information they will need, and provides automated templates to write pleadings and motions.

Last year, Courtroom 5 was named one of 10 startups to watch by the N.C. Technology Association. The company has raised around $500,000 from investors, according to Crunchbase.

LoanWell

Durham-based LoanWell is the creator of a loan origination platform for Community Development Financial Institutions, which often serve low-income and minority communities.

The company, founded in 2017 by Bernard Worthy, is helping many of these institutions move their loan originating process online.

Based out of the American Underground campus in downtown Durham, LoanWell has raised $3.1 million from investors and has around 15 employees.

The company previously received a $100,000 grant from Google’s Black Startup Fund, The News & Observer previously reported.

BatteryXchange

Charlotte-based BatteryXchange makes portable battery charging kiosks.

Founded by Desmond Wiggan Jr. and Aubrey Yeboah in 2019, the company seeks to set up its kiosks at events, universities or businesses, where users can rent a portable battery and charge their phones while walking around.

The company previously received a $50,000 seed grant from NC IDEA last year.

Davos Corporation

Durham’s Davos Corporation is an online lender matching platform that helps customers find guarantees for each of their loans.

Founded by Amber Bond, who had previously worked for the Carolina Small Business Development Fund, Davos seeks to make it easier for entrepreneurs to get access to capital, by providing a guarantee to a lender.

“We’re helping the borrower by taking on some of the risk in the transaction, which makes them more attractive to lenders,” Bond told the online publication GrepBeat in 2020.

Freeman Capital

Freeman Capital is a Charlotte-based fintech company that is seeking to close the racial wealth gap by helping more people of color enter into investing and wealth management.

The company’s platform teaches financial literacy to its users and provides individual investment management.

Freeman, founded by Calvin Williams Jr., previously received a $50,000 grant from Google’s Black Startup Fund. It’s now raised $1.7 million from investors, according to Crunchbase.

Renaissance Fiber

Renaissance Fiber, which counts Winston-Salem and Wilmington as home, is hoping to create more environmental textiles using hemp and other natural fibers.

All of the company’s hemp is grown in the U.S., and the company is creating hemp that is able to blend with cotton, polyester, wool and other fibers.

Smart Girls HQ

Founded by Abi Olukeye in 2018, Smart Girls HQ began as an effort to get more young girls involved in science, technology, engineering and math activities.

The Charlotte company is building a digital platform that will provide resources and activities that teachers and parents can provide to young girls around STEM education.

The company received a grant of $256,000 last year from the National Science Foundation’s Small Business Innovation Research program to advance its platform, the online publication Charlotte Inno reported.

This story was produced with financial support from a coalition of partners led by Innovate Raleigh as part of an independent journalism fellowship program. The N&O maintains full editorial control of the work. Learn more; go to bit.ly/newsinnovate

This story was originally published January 21, 2022 8:30 AM.