Entrepreneurs who come from ethnic minority backgrounds – and particularly those who are female – face systemic disadvantages, according to The Alone, Together Report from the British Business Bank.
UK accelerator Add Psalt was set up with the express intention of addressing what it describes as this ‘unlevel playing field’.
“What we know is that it is extremely hard to launch a brand in such a competitive market. If you don’t have the network, resource and access, it makes it even harder. Black founders statistically have less of these opportunities. We know that Black Female founders get significantly even less investment for example,” explained co-founder Sam Akinluyi.
“It’s clear that there is a problem. The big issue of under-representation is made up of a variety of concerns and causes, but rather than making judgements or assigning blame, we set up ADD Psalt to highlight and push against these challenges, to create an equal opportunity landscape for anyone and everyone.”
According to a report from Cornerstone Partners, 2.9% of successful venture capital raises in the UK are granted to Black-owned businesses. ADD Psalt notes that less than 2% of Britain’s food and drink businesses is estimated to be Black-owned.
The 2018 UK census reported that the country’s Black population stands at just shy of 3%. So does this represent a significant level of under-representation. Akinluyi is clear that it does.
“We actually believe that 2% is a very generous estimate. Of the thousands of brands in a major UK retailer, only two-to-four of them are Black owned. This is a much lower percentage in context,” he stressed.
Breaking down the barriers
“ADD Psalt believes that it’s critical to break down any barrier that means it’s less possible for someone to achieve something because of their background. We want to show that things are possible – no-one is born a ‘winner or a loser’. Also, by breaking down barriers, the industry can benefit from a more diverse and richer pool of talent, products, tastes, ideas and perspectives,” Akinluyi told FoodNavigator.
The not-for-profit initiative is welcoming three companies owned by four ‘highly ambitious, talented and passionate women’ to its second Cohort of start-ups, following the successful conclusion of its Cohort 1 pilot last year.
Participants include Jane Visram, founder of luxury free-from ice cream brand Mama Dolce; Taeya Abdel-Majeed and Maya Harruna, co-founders of keto treats brand, No Guilt Bakes; and Jacine Rutasikwa, co-founder of craft spirits brand, Liv Rum.
These three brands were selected from a ‘huge’ number of applicants and their business models were assessed based on clear criteria, Add Psalt’s co-founder told us.
“We’ve had a huge number of brands apply for this cohort thus clear criteria for selection was key: Desirability - did the brand meet the trend and grow in line with what consumers want? Feasibility - brands are required to have an existing manufactured product to scale quickly if they were to secure a retail listing. And Capability - we interview applicants to get an understanding of their technical ability and drive to take the brand forward post the programme.”
The growth program offers participants strategic guidance, product and brand development, and ‘unparalleled access’ to national retail distribution. Each brand benefits from around £55K worth of free expertise from ADD Psalt’s industry expert consultants and its Advisory Board made up of senior leaders across blue-chip FMCG brands and major retailers alike, the accelerator explained.
The desired outcome is to mitigate barriers to growth, establish clear positioning and competitive edge, brand design, commercial strategies and activation plans.
In the first Cohort, this included guidance from 29 buyers across Tesco, Sainsburys, Waitrose and Ocado; brand expertise from Coca-Cola, Diageo, Graze, Heineken, Innocent, Lyre’s, and Pip ‘n Nut; creative and design input from The Cabinet, complimentary data insights from IRI and legal input from Latham Watkins.
“The accelerator provides the focus, technical support, network, resource and access required for a brand to succeed. We make this available to those that may not readily have access to it. Finance and funding is a key part. While we do not have the means of directly providing finance, we get the brands investor ready and provide access to investors. We give the brands the platform they deserve,” Akinluyi explained.
The graduate brands from Cohort 1 include Blue Turaco, Jamaican Rum Vibes, and Rogue – each had two sessions with retail buyers and received a range of training including communications, social media, sales, marketing and becoming ‘investor ready’.
To complete the programme, ADD Psalt held an investor event, with brands pitching to a range of investors and venture capitalists.
The brands are all currently in a fundraising round targeting retail launches for 2022.