Civic-tech group P33 and Verizon are launching a $5 million fund to invest in startups founded by Black and Hispanic entrepreneurs.
The wireless company is the lead sponsor of the fund, called TechRise, which will make grants of $10,000 to $50,000 and be led by Desiree Vargas Wrigley, a Chicago tech entrepreneur who has founded two companies.
Black and Hispanic founders get a sliver of venture funding, just 2.4 percent nationally. They find it even tougher in Chicago, where they get about 1.9 percent of the pie. When Black and Hispanic entrepreneurs in Chicago are just starting out, raising so-called friends and family rounds, they receive about $35,000, compared with about $107,000 for all founders.
TechRise will hold weekly pitch competitions for founders. The goal is to have 2,500 founders pitch angels investors and venture capital firms over the next three years. Vargas Wrigley figures about 500 will receive funding. TechRise also will connect entrepreneurs with mentors, peers and other resources.
P33, a nonprofit organization whose goal is to increase the number of tech companies in Chicago, is soliciting funding from other corporate sponsors in addition to Verizon.
TechRise is among several new funds that aim to help minority entrepreneurs to emerge in the wake of protests over the death of George Floyd, which caused companies to take a closer look at racial and income inequality.