Diversity Fund Helps Women, Gay and Minority Businesses Get Funded

Charlie Jackson, founder of the Diversity Fund in Austin. Courtesy photo.

Charlie Jackson, founder of Diversity Fund in Austin. Courtesy photo.

Diversity Fund recently launched in Austin and aims to help startups and ongoing businesses raise capital through equity-based crowdfunding.

In particular, Diversity Fund, founded by Charlie Jackson, aims to help women, LGBT and minority-led businesses get financing directly from investors through debt or equity funding up to $1 million a year for any Texas business.

The portal also helps investors find deals to put their money into. Jackson recently answered some questions about the business and why it’s needed in Austin and Texas.

Q. What is the Diversity Fund?

690964-62d44b32fb6926aedd4c72690c1e51dd-medium_jpgA. Diversity Fund is an online finance portal, operating under the new securities crowdfunding rules, that allows business to sell equity to or borrow money directly from investors. (We are currently operating under the Texas State Securities Board equity crowdfunding rules.)

Q. How does the Diversity Fund portal work?

A. Businesses decide how much money they need to raise, sign up, select whether they want to offer Rewards, Lending, Equity or any combination and launch their deal. When their “deal” goes live, investors are then able to finance these businesses directly from the business (securities rules require that deals be available for a minimum of 21 days for investors to view, ask questions, and perform their own due diligence) and invest in local businesses right in their own city. Under these new rules, ANY Texan can now be an investor regardless of income (previously only “accredited” investors had access to such deals).

Q. Why did you decide to create it?

A. Businesses always have a challenge raising capital unless they already have assets or have been in business more than two years. We wanted to provide them a faster and easier way to get financing using the crowdfunding model while at the same time provide investors a way to participate directly in business finance.

Q. Who is your customer?

A. We specifically focus on women, LGBT, and minority-led businesses. Although these make up the majority of all small businesses, they traditionally have had a harder time achieving funding.

Q. What sets you apart from your competition?

A. We offer a simplified way for businesses to raise capital and for investors to directly participate in the funding of Texas businesses.

Q. Are you bootstrapped? Do you have VC funds or Angel investment?

A. Bootstrapped so far. No outside financing to date.

Q. Why is this fund needed in Austin?

A. Austin has lots of entrepreneurs and a great support system for hi-tech startups, but has lacked in good financing for other types of business.

Q. What is your biggest accomplishment so far?

A. We’ve already gone live with three businesses and have many more seeking us out to participate in the portal.

Q. What is your biggest mistake?

A. Like many startups, it has taken us a bit longer to launch than we originally planned.

Q. How do you get the word out about Diversity Fund?

A. We market through a variety of channels, particularly by focusing or organizations (online and offline) that support entrepreneurs in our target market.

Q. How many employees do you have?

A. We have a team of six.

Q. Where are you located in Austin?

A. We don’t yet have offices, but plan to locate downtown.

Q. What Austin resources have you drawn on to help launch Diversity Fund?

A. Network of friends and contacts (I’ve worked on hi-tech startups in Austin for the past 20 years).

Q. What else would you like to mention?

A. Although we’re relatively new, we are excited about this business model, already expanding throughout Texas and look forward to a national launch in 2016.

Comments

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