BK-XL, The Joe and Clara Wu Tsai Foundation’s Brooklyn start-up accelerator, has started to accept applications for investments of as much as $500,000 in companies owned by BIPOC, Black and Indigenous People of Color, entrepreneurs.
The application process began Monday and closes on January 20...
IT’S OFFICIAL: applications are now open for @BKXLAccelerator— Social Justice Fund (@socialjusticefd) December 6, 2022
, a new Brooklyn-based early-stage startup accelerator for BIPOC founders!
Selected founders will have the opportunity to receive up to $500K in investments.
Deadline to apply is 1/20. https://t.co/5huzBtDbto
The program will be a mix of grants, loans and investments for borough companies, Clara Wu Tsai said when the program was announced a month ago. As the New York Times reported Tuesday, the first beneficiaries of the program, part of the Tsai’s $50 million commitment to their Social Justice Fund, will be announced next year.
BK-XL was set up by Clara Wu Tsai, a philanthropist who with her husband, Joseph Tsai, owns Barclays Center and the Nets. She said she envisioned “an entrepreneurial hub that will be inspired and powered by location and diversity, much like Brooklyn itself.”
BK-XL will take applications through Jan. 20 before choosing 12 companies to receive initial investments of $125,000 each, in return for a 7 percent equity stake. The companies will also be eligible for additional investments of $375,000 apiece if they stay in Brooklyn for at least a year and meet their growth targets.
The equity stake will be split between Wu Tsai’s Social Justice Fund and the investment firm, Visible Hands, a platform for “overlooked founders launching and scaling high-growth startups,” per the program.
Timing for the program is ideal with Brooklyn becoming hotbed for technology-reliant companies, including popular national and international brands like Etsy and Kickstarter. BK-XL is interested in making sure that BIPOC firms don’t miss out.
“When we think about the economic landscape and the opportunity to support BIPOC founders, Brooklyn is an amazing place to do that,” Daniel Acheampong, a co-founder and general partner in Visible Hands, told the Times.
“Just numbers-wise, the Black community makes up 22 percent of the city’s population, but only 3 and a half percent of New York City businesses are owned by Black entrepreneurs,” Acheampong said. “This shows there’s a gap where we should be investing in BIPOC projects.”
Also, Brooklyn and New York City have a leading resource for BIPOC technology firms’ eventual success: a wealth of Black and Hispanic workers. The Times reports that Black and Hispanic workers make up 21 percent of tech employees in the city, more than double the share in the San Francisco Bay Area or in Boston.
Like the Nets and Liberty and a number of new tech and biotech companies, BK-XL will have office space in Industry City, The 12 companies will also have space in the complex during a 10-week immersion program that will include help for the entrepreneurs in making connections for future business. Blue Pool Capital, the Tsai’s family investment office, will also provide mentorship help.
The program is part of the Tsais’ commitment to the underserved businesses in Brooklyn. It started when the George Floyd protests filled the Barclays Center entrance plaza in 2020. The $50 million commitment is in addition to the $10 million each NBA team was asked to provide. Last year, the Social Justice Fund launched the “EXCELerate” initiative that provided no-interest loans to Black-owned small businesses in Brooklyn that needed help recovering from the COVID-19 pandemic shutdowns.
As NetsDaily reported four days ago, that program has already helped a number of women-owned companies deal with the ramifications of COVID. Those successes were highlighted by the Liberty in announcing its 2023 schedule.
“We want to show that investing in Black businesses makes money,” Wu Tsai said in announcing the BK-XL program last month. “We want to show it’s good business.
“I think that you should just play with all the different arrows that you have in your backpack,” Wu Tsai said. “There’s so many levers. There’s not just one way to impact a community. I think you’re much more effective if you can use different methods to reach different people who need it.”
Meanwhile on Wednesday, Wu Tsai and Meek Mill, co-founders of the REFORM Alliance, hosted mothers and children impacted by the criminal justice system for a special holiday experience at Barclays Center before the Nets game against the Hornets. The Alliance, separate from the Social Justice Fund, aims at changing the probation and parole system in the U.S.
- Why the Owners of the Nets Are Funding Tech Start-ups - James Barron - New York Times