In a shared effort to support diverse founders, St. Paul-based ConnectUP! Institute has acquired Lunar Accelerator, a program geared toward supporting underrepresented entrepreneurs.
St. Paul-based Lunar Startups, the entrepreneur support organization that runs the accelerator, is dissolving in the process. The acquisition helps merge the skillsets of each organization, giving entrepreneurs and alumni in the program a strengthened pathway to receiving capital after graduating. The announcement landed Tuesday and noted that Lunar Startups Executive Director Danielle Steer will remain involved through her role on ConnectUP!’s board of directors.
ConnectUP! Institute provides education, consulting and financing options for entrepreneurs that come from what it calls "underestimated communities," with an emphasis on Black and brown women. Founder and CEO Y. Elaine Rasmussen, a woman of color herself, boasts a range of accolades for her work in the sphere.
Steer said there are three key ingredients for entrepreneurs’ success: social capital, inspiration capital and financial capital. While Lunar had a handle on tackling the first two, Steer said ConnectUP! has a capital vehicle suited to create a more streamlined process for founders in the program.
ConnectUP!'s Integrated Capital Fund provides early second-stage Black and Indigenous entrepreneurs with flexible capital of $25,000 to $60,000 in grants, debt or equity, along with fractional executive support and coaching.
For Lunar founders and alumni who are not pursuing venture-backed funding, “ICF is an incredible opportunity to acquire much-needed capital,” according to the acquisition announcement.
Lunar says on its website that when it launched in 2018 that it was one of the first organizations “explicitly welcoming underestimated founders to the startup ecosystem.” Since then, 77 startups have cycled through Lunar programs, with 77% of founders identifying as people of color and 67% identifying as women.
Steer said she’s “ecstatic” about the acquisition and the better opportunities it could bring for founders. Plus, she said "there's all types of positive outcomes for us as organizations that are byproducts of this," like more efficient internal operations.
“What this acquisition means for the ecosystem is actually reducing redundancy and making clear pathways to walk an entrepreneur through one program to transition to the next program to transition to the next program,” Rasmussen said in an announcement video posted to social media.
Steer said anybody is invited to apply to the Lunar Accelerator at ConnectUP!, but it was specifically designed with underinvested founders in mind. While ConnectUP! has traditionally served Black entrepreneurs, the accelerator is also aimed toward LGBTQ+ people and women.
Applications for the seventh cohort will open in early 2024.
