A co-founder of Atlanta-based venture capital firm Fearless Fund has resigned as chief operating officer – WABE

One of the co-founders of an Atlanta-based venture capital firm that supports women of color has resigned as chief operating officer as the company fights a lawsuit that has become emblematic of a conservative backlash against corporate diversity programs.

Ayana Parsons confirmed in a statement that she has resigned as general partner and chief operating officer of the Fearless Fund, which she co-founded in 2019 with Arian Simone to address the vast racial disparity in funding businesses owned by women of color.

“I remain steadfast in my support of the Fearless Fund and committed to the advancement of women and people of color,” Parsons said in a statement posted Monday on her LinkedIn page. “The best way to do this is to boldly focus on new strategies and tactics. Because if the courts want to set aside our best practices, we must design and implement alternatives. We must innovate.

The announcement came about three weeks after a federal appeals court ordered the suspension of a grant competition for black women business owners, hosted by the Fearless Fund foundation. The grant program is the subject of a lawsuit brought by the American Alliance for Equal Rights, a group led by Edward Blum, the conservative activist who initiated the Supreme Court lawsuit that ended affirmative action in university admissions. In a 2-1 verdict, the three-judge panel ruled that the lawsuit, which claims the program is discriminatory, had a strong chance of prevailing.

The Fearless Fund has invested nearly $27 million in around 40 companies led by women of color since its launch in 2019 with the support of leading companies like JP Morgan Chase & Co., Bank of America and Mastercard . Companies supported by the Fearless Fund include restaurant chain Slutty Vegan and Thirteen Lune, an e-commerce platform that promotes beauty brands created by people of color.

Simone said the Fearless Fund was struggling to raise new investments amid the lawsuit.

The lawsuit targets the Fearless Foundation’s Strivers Grant competition, which awards $20,000 to businesses led by Black women. Blum argued that the competition violated a section of the Civil Rights Act of 1866 prohibiting racial discrimination in contracts. Lawyers for the Fearless Fund say the grants are not contracts but donations protected by the First Amendment.

In the statement released Monday, Simone said Parsons had “devoted tireless hours advising many of our portfolio companies.”

“We are sad to see her go and wish her the best in her new endeavors,” Simone said.

Parsons and her husband also co-founded Yardstick Management, a consulting firm for underrepresented business leaders, which they sold in 2023 after 11 years.

Parsons did not give a reason for her decision to resign or specify what her next steps would be, although on her LinkedIn page she said she would “enjoy island life with my incredible family while continuing to fight and to embody FREEDOM.”