New Pattern Utah aims to break down disparities in business funding for Black women

Kimmy Paluch, co-founder of BetaBoom, poses for photos in Sandy on Wednesday, July 22, 2020. | Scott G Winterton, Deseret News

SALT LAKE CITY — A just-launched funding and mentorship program is aiming to chip away at disparity issues in Utah’s startup community with assistance tailored for Black women business owners.

The groups behind New Pattern Utah say that despite the fact that Black women are starting businesses faster than any other demographic, they are also encountering the greatest barriers to accessing funds and receive less than 1% of U.S. venture capital funding each year. To improve that number, Womenpreneurs, Utah Black Chamber, Beta Boom and Sorenson Impact have launched the collaborative grant and mentorship program for Utah businesses owned by Black women.

Beta Boom co-founder Kimmy Paluch said her venture capital firm, which specializes in backing minority-run businesses, has long recognized the issues raised by a funding community in Utah, and across the country, that has functioned in a largely homogeneous manner.

“We at Beta Boom have been working on this for about two years,” Paluch said. “There’s a massive gap in the startup ecosystem when it comes to female founders and founders of color. New Pattern takes a step toward action and bridging some of those gaps by providing assistance to the Black community specifically.”

While Paluch’s firm has been primarily focused on tech efforts, she said New Pattern Utah will be agnostic when it comes to business types but expects that many applicants will come from the tech sector, particularly in light of how much pressure the COVID-19 pandemic has put on traditional retail and service-oriented businesses.

A weak spot in Utah’s otherwise booming tech sector has been a notable lack of diversity.

An expansive report released last year by the University of Utah Kem C. Gardner Policy Institute highlighted that while the state’s tech sector is an economic powerhouse, it reflects the same diversity challenges as the overall U.S. tech realm, with the typical Utah tech worker likely to be male, white or Asian and mid-career. Viewed against countrywide performance data, diversity in the Utah tech sector is lagging behind national averages. According to the report, in 2017 83.2% of Utahns in tech occupations were white while 16.8% were racial or ethnic minorities. Nationally, about 36% of tech workers in 2017 were racial or ethnic minorities.

Utah is trailing the national average for the number of women employed in tech, as well. While 2017 data reflects 22.5% of U.S. tech workers were female, in Utah women made up only 15.2% of the state’s tech workforce.

And Utah continues to lag behind the rest of the nation when it comes to gender pay disparities.

A report releases last year by YWCA Utah noted the state comes in dead last when it comes to wage disparity by gender. According to the report, women make 69.8% of their male counterparts, a rate that puts the state at No. 51 in the country.

The state’s ongoing gender wage gap has only enhanced the marginalization of groups that have been historically ignored by those who control where startup capital goes, according to Womenpreneurs co-founder Rose Maizner.

“Due to centuries of systemic oppression and discrimination, further exacerbated by Utah’s persistent wage gap, Black communities in Utah have not had the same opportunities to generate wealth as other racial groups, making it extremely challenging for many early-stage founders to secure the initial capital required to get their businesses off the ground,” Maizner said in a statement. “While the New Pattern Utah grant will not solve the systemic issues that still need to be addressed, the initiative is one small step in our commitment to continue supporting Black female founders.”

Besides being able to provide capital infusions, with seed funding from the Community Foundation of Utah’s Social Investors Forum that will initially will be capped at around $10,000 per applicant, Paluch said New Pattern brings a suite of support services to help founders get the most of the cash infusions.

That help includes an eight-week intensive fundraising course provided by Womenpreneurs as well as a six-month, peer-based leadership development program. Mentorship and coaching opportunities including focused assistance on fundraising, marketing and product development through Beta Boom as well as access to legal support, help with business certifications and other trainings through the Utah Black Chamber.

Paluch said Sorenson Impact will be running an ongoing assessment of the program to measure outcomes and help ensure effective strategies.

She said the longer-term hopes are that the program will seed more expansive changes in Utah and across the country.

“The reason behind doing this is to create a movement, not just in Utah but in the nation and across the world,” Paluch said. “It’s about making things happen to help level the playing field.

“A lot of us have been working in silos but now we’re forming coalitions and combining efforts to work toward a shared vision ... and we’re excited to see it grow.”

To be eligible for New Pattern Utah funding, companies must have been incorporated in Utah by Jan. 15 and have at least one Black female or non-binary founder over the age of 18. All applications, according to New Pattern Utah, will be evaluated and reviewed by a steering committee made up of business and civic leaders within the Utah community. The initial grant recipients will be announced within six to eight weeks. Women interested in applying should submit an application at newpattern.org/apply.

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