Her fund targets investments for women of color; why this VC is fighting a lawsuit that would curb equity-focused funding 

The fight for equity — especially among Black and brown entrepreneurs — isn’t easily won, said Ayana Parsons, likening the setback-laden struggle to a boxing match that seemingly never ends.

“There are many rounds,” Parsons recently told a Kansas City crowd gathered at Burns & McDonnell’s campus for an event to honor diverse legacies. Parsons’ own time in the ring has seen her battle a high-profile, ongoing lawsuit aimed at stopping her venture fund from investing specifically in businesses led by women of color.

Ayana Parsons, Fearless Fund, speaks to a Kansas City crowd gathered at Burns & McDonnell’s campus for an event to honor diverse legacies; photo by Nikki Overfelt Chifalu, Startland News

“We won the first round, lost the second round, and have another round coming up,” said Parsons, co-founder and general partner of Atlanta-based Fearless Fund. “So it’s not over and it will be a very long, tumultuous road ahead.”

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Fearless Fund is the first venture capital fund founded by women of color investing in women of color led businesses. Parsons also founded AKP Management LLC, a consultancy for purpose-driven changemakers, small businesses, and corporations; and co-founded Yardstick Management, a DEIB consultancy startup that exited in early 2023.

Reflecting on Civil Rights icon Martin Luther King, Jr.’s legacy during the Kansas City event, Parsons discussed her own resilience at Fearless Fund in the face of political turmoil with affirmative action initiatives.

“The message that I am here to talk to you all about keeping the dream alive, and this message is more important now than ever,” she said. “We are being set back as a country instead of moving forward.”

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Ayana Parsons, Fearless Fund, speaks to a Kansas City crowd gathered at Burns & McDonnell’s campus for an event to honor diverse legacies; photo courtesy of Burns & McDonnell

“Ayana just has this fire about her and the work that she’s doing,” said Leon Harden, diversity, equity and inclusion manager at the event’s host, Burns & McDonnell. “We’re happy to have someone like her who can talk about a case like this, and really be pushing us forward as we talk about these topical issues within our workspace.”

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Ayana Parsons, Fearless Fund, speaks to a Kansas City crowd gathered at Burns & McDonnell’s campus for an event to honor diverse legacies; photo by Nikki Overfelt Chifalu, Startland News

Fund dreams fearlessly

In 2021, $288 billion in seed money was invested in small businesses and startups to support entrepreneurs, Parsons noted, but only a fraction — 0.39 percent — was allocated to women of color.

When she dived deeper, Parsons learned that women of color are the most founded demographic of entrepreneurs yet the least funded — a realization that led her to launch Fearless Fund to specifically offer financial backing to women of color seeking their own entrepreneurial dreams.

“The inequities are vast, that’s why I co-founded Fearless Fund, because if you can diversify the investors, you can diversify investments,” said Parsons.

Fearless Fund has invested more than $30 million in capital, and boasts a portfolio that encompasses 41 women-led businesses — such brands as The Lip Bar, Slutty Vegan, Bread Beauty, and Hairbrella.

“The jobs that are created through small businesses and entrepreneurs, and the communities that are transformed through business, that truly is the pathway to achieving the American dream,” said Parsons.

Affirmative action under fire

Fearless Fund’s work and momentum gained national attention in summer 2023 when conservative anti-affirmative action advocate, Edward Blum with the American Alliance for Equal Rights, filed a lawsuit to halt the fund’s investments in women of color.

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“The reality was, my ancestors and your ancestors died and gave their blood, sweat, and tears for us to have the possibilities of the American dream,” said Parsons. “So when I think about affirmative action being overturned, what that signifies to me is we have a lot of work to do.” 

When she first received the news of Blum’s lawsuit, Parsons recognized it as a targeted and conscious attempt to end all race-conscious decision making.

“My lived experience comes from the intersectionality of being Black and a woman,” she said. “That lived experience is as valuable as those skills and those competencies that you’ve learned in what you do every day, and so it frightens me.”

Ayana Parsons, Fearless Fund, participates in a Q&A session with Kansas City Mayor Quinton Lucas at Burns & McDonnell; photo courtesy of Burns & McDonnell

More at stake

Parsons recognizes the potential far-reaching consequences of the lawsuit, suggesting that its ripple effects could extend beyond race and investments, impacting such communities as veterans, people with disabilities and other underserved or often overlooked populations who benefit from equity-focused efforts.

“That’s part of why not only this lawsuit, but many of these lawsuits are so much bigger than us, and why we need to make sure that we are active, we’re using our voice, you’re being advocates,” said Parsons. 

“I would just implore you all to just get educated, see what’s happening and get involved.”

During a Q&A session with Kansas City Mayor Quinton Lucas, Parsons was asked about her resilience and what keeps her going during this fight.

“When you know that the work that you’re doing matters, that you matter, and that you’re living your purpose and your passion, you cannot lose,” she answered.