Local entrepreneur Rico Grant is looking to help support the next wave of Black small business owners in Cincinnati with the launch of a new $1.5 million fund, and the effort has landed seed funding from one of the city’s biggest corporations.
Grant, founder of Paloozanoire, owner of Gallery At Gumbo and executive director of SoCap, a Northern Kentucky University-based accelerator, said Fundnoire, a $1.5 million fund dedicated to Black entrepreneurs in Cincinnati, will provide grant money to dozens of Black-owned small businesses to help them launch and grow.
The idea has been months in the making; Fundnoire went public in recent weeks when the enterprise received seed funding from the Kroger Co. Foundation.
Grant — who in 2019 founded Paloozanoire, an event company with two main activations, Black and Brown Faces, a fine art exhibition dedicated to Midwestern Black artists, as well as downtown’s Juneteenth Block Party; and, in 2021, Gallery At Gumbo, an Over-the-Rhine barbershop/art gallery on Main Street — said he’s “notoriously struggled” with how to best help other Black entrepreneurs looking to launch their ideas in the city.
Fundnoire will provide one of the biggest needs: funding.
With its $1.5 million reservoir, the organization plans to distribute non-diluted grants of up to $50,000 to Black-owned, non-tech-related small businesses “to create what they thought might have been impossible,” Grant said.
Fundnoire will provide capital to businesses from coffee houses to tailors to tire shops and more.
“We have specific interest in Black art and culture, like a Gallery At Gumbo or Black Coffee (Lounge), that, if they pulled out of Cincinnati right now, the landscape of our entire city would change, because these are things that people really, really enjoy,” he told me. “Our community is full of hard workers, and we're excited about not only brick-and-mortar-style concepts but also initiatives: the block party concepts and art exhibitions. Things that are repeatable and scalable, that's our sweet spot.”
Fundnoire plans to award grants to 24 Black-owned small businesses over a two-year period; Grant said three or four businesses would receive funds each quarter. Founders would apply during an open application process.
Of the $50,000 amount, $30,000 will be invested upfront, with the opportunity for up to $20,000 in follow-on funding if milestones are met, such as launching, job creation or expansion.
Grant decided on $50,000 for a myriad of reasons, including the feedback of more than 200 Black and Brown existing and aspiring entrepreneurs in the city which Fundnoire surveyed. He said 88% of respondents acknowledged their concept or idea could be launched on that amount or less.
Other survey results:
- 78% said access to capital was the No. 1 barrier to launching.
- 75% said they considered and/or were considering moving outside the area to pursue their entrepreneurial idea.
- 98% said with the right resources, they would want to build their business in town.
“Something like this, it can change the landscape of our city — literally — if we're able to help them get off the ground from a financial standpoint,” Grant said.
Fundnoire has secured $100,000 in the form of a Changemaker grant awarded by Kroger Co. Foundation’s Racial Equity Fund, part of a $600,000 allocation that went to three local organizations, including the Urban League of Greater Southwestern Ohio and National Underground Railroad Freedom Center.
In a release, Keith Dailey, president of Kroger Co. Foundation and group VP of corporate affairs for Cincinnati-based Kroger (NYSE: KR), said the goal is to support organizations looking “to uplift and inspire true change.” That includes “new and innovative strategies to build and sustain Black wealth.”
“We plan to explore more partnerships, very similar to the Kroger Foundation,” Grant said. “A lot of funds have been created around equity and inclusion, and that's a big part of Fundnoire.”
Grant plans to spend the better part of 2022 fundraising to meet the $1.5 million goal. He also wants to build a small team around the initiative. He’s currently working on Fundnoire solo.
After that, it’s on to building fund II. The idea would be to eventually fund six or more small businesses a quarter.
“This shouldn't be just a one-time deal,” Grant said. “We want to keep this going. I think it’s powerful. There's nothing here that’s funding (businesses) in a non-dilutive way at this amount, Black and Brown entrepreneurs and founders who are trying to create things that cut into the fabric of our city and make it the place we aspire it to be.”
