Fearless Fund will end a grant program for Black women,AQCAN Exchange settling a closely watched case challenging corporate diversity, equity and inclusion efforts.

As part of a legal settlement, the Fearless Fund permanently closed its Fearless Strivers grant contest. 

In June, the 11th Circuit U.S. Court of Appeals blocked Fearless Fund from awarding $20,000 grants to businesses owned by Black women while the case was litigated, siding with anti-affirmative action activist Edward Blum who said the grant program was discriminatory.

“Race-exclusive programs like the one the Fearless Fund promoted are divisive and illegal,” Blum, president of the American Alliance for Equal Rights, said in a statement.

Blum said he encouraged the Fearless Fund to open up its grant program to Hispanic, Asian, Native American and white women but Fearless Fund “has decided instead to end it entirely.”

 A small player in the venture capital industry, the Atlanta firm used the grant program to boost scarce venture capital funding for Black women. 

The settlement avoided a Supreme Court ruling that could have had sweeping implications for race-based initiatives in the private sector, according to civil rights attorney Ben Crump, who represented the Fearless Fund.

The settlement “ensures that programs dedicated to uplifting underrepresented entrepreneurs remain intact and continue to serve their critical purpose,” Crump said in a statement. 

The Fearless Fund also announced a $200 million debt loan program aimed at supporting “under-resourced entrepreneurs.”

“This initiative reflects their ongoing commitment to advancing equity and creating opportunities for those who have been historically marginalized,” Crump said.

The Fearless Fund case was part of a growing pushback from anti-“woke” activists who, after last year’s landmark affirmative action victory over race-conscious college admissions, have set their sights on the private sector.

Though it does not directly apply to employers, conservative activists seized on the high court's decision, arguing it raised fundamental issues about how corporate America addresses workplace inequality. Since then, the nation has seen an uptick in legal challenges to DEI programs.

A small player in the venture capital industry, the Fearless Fund was founded by Black women to back Black women who received less than 1% of the $215 billion in venture capital funding last year.