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Mastercard announces investment and partnership in black-owned businesses

Mastercard on Tuesday announced a multi-million dollar investment in Fearless Fund, a venture capital firm founded by black women with a mission to invest in minority women entrepreneurs.

The exact amount was not disclosed.

The credit card giant also unveiled a partnership with Greenwood, a financial technology firm aimed at black and Latino consumers and business owners, to issue the platform’s first debit cards.

“This is part of our larger work on financial inclusion,” Mastercard president of strategic growth, Michael Froman, told CNBC. “We want to put all of the company’s strengths on the table, engage with them, help them succeed, help them develop. “

Fearless Fund seeks to provide early funding to businesses started by women of color in the tech, consumer packaged goods, food, fashion and beauty industries.

Other investors in Fearless Fund include PayPal, Bank of America, and Costco.

The three co-founders of Fearless Fund are Director of Development Keshia Knight-Pulliam, who played Rudy Huxtable on the “Cosby Show”; CEO Arian Simone, entrepreneur and best-selling author; and COO Ayana Parsons, a seasoned consultant.

Simone told CNBC that Mastercard’s investment has the potential to be a game-changer for the companies in the fund’s portfolio.

“This agreement also marks an important milestone for our brand,” she said. “When women of color have the resources and funding to start their businesses, the sky is the limit.”

Women of color are “noticeably underfunded,” Simone said, adding that they generally do not rely on large institutional investments when creating their business plans. “They are ready to go and [are] in the state of mind that they should be the main driving force behind their ideas, ”she added.

Black and Latino founders received less than 1% of venture capital funding, according to a 2020 report from Digital Undiveded.

“When a company like Mastercard provides this level of funding to propel founders of women of color, it takes everything these women are already doing and maximizes it to a degree that will allow them to shake up any industry they enter. “said Simone.

Last September, the credit card giant pledged $ 500 million to support black communities and help close the gap in racial wealth and opportunity over the next five years.

“There are a lot of changes happening in the venture capital world, with all the announcements and commitments made by big companies to invest in various fund managers, but we’ll have to see if all of them are really executed and operational on the basis of their declarations, ”says Simone.

“Mastercard is living up to its commitment, but we need to make sure that everyone is making systemic change rather than following a trend. What I really hope to see from investors is a greater focus on inclusion. “

Mastercard to help Greenwood issue debt cards

Greenwood will issue two Mastercard-backed debit cards offering features such as identity theft protection, credit monitoring and airport concierge service.

The service was co-founded by civil rights leader Andrew Young, rapper-activist Michael “Killer Mike” Render and Ryan Glover, founder of the Bounce TV Network.

“It is encouraging to know that Mastercard is aligned with our mission of economically empowering people of color,” said Glover, president of Greenwood. The alliance also provides “Greenwood customers will get a top notch product and the tools to increase their wealth,” he added.

Mastercard and Greenwood are also teaming up on a financial podcast and other educational content on banking, financial planning, homeownership and wealth creation designed to engage Black and Latino communities.

Greenwood, launched last October, already has a waiting list of over 500,000 people. The Greenwood Debit Mastercard is expected to be available later this year.

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