Retail technology is blossoming, and a new program aims to help startup founders of color bring their brightest ideas to light.
XRC Labs, an accelerator focused on growing companies in the retail and consumer packaged goods sector, this week announced a new program geared specifically toward minority businesses looking to break into the space.
“We wanted to drive real meaningful change in our industry,” XRC Labs chief operating officer Kelly Chen told Sourcing Journal, citing the fact that less than 3 percent of venture-capital-backed founders are black or Latinx. “It’s not a pretty picture,” she added. “We wanted to do our part to change that.”
XRC Elevate, which launched Tuesday, aims to provide minority-founded startups with the tools and resources they need to propel their businesses forward. “I think of it as almost like getting an MBA for founders,” Chen said, touting the program’s “well-rounded curriculum” that includes courses in finance, legal, marketing and branding, as well as instruction on how to assemble investor decks and script pitches. Founders will also be paired with mentors—established entrepreneurs or business-owners who have expertise that complements their businesses.
Would-be participants at any stage in the business life-cycle—whether pre or post-revenue—can apply before Jan. 24 to be selected for one of two educational sessions taking place this year. The program’s introductory 8-10 participants will be named in February, and the first named pick will receive a $5,000 grant to help support their company’s growth.
According to Chen, the idea for the program began to materialize throughout 2020’s protests of racial inequality. As heated discussions swept the nation, XRC Labs challenged itself to think about how it could “improve diversity and inclusion, internally as well as externally.” Currently, about one-third of the group’s portfolio companies were established by founders of color.
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In XRC Labs’ typical accelerator program, the company would ask for equity in return for its investment of resources. The Elevate program’s goal, by contrast, is to provide educational services and support—which XRC Labs values at around $35,000—gratis. As the program moves forward, the group hopes to be able to offer more monetary grants to incoming founders.
In addition to education, XRC Labs’s business development arm also works to create connections between founders and sponsors—like TJX Co., for example, which owns brands like T.J. Maxx, Marshalls and Homegoods—that might have a “pain point” in their business that needs an innovative retail tech solution. The group helps forge those relationships, she said.
XRC’s standard accelerator program has yielded a number of solid additions to the retail technology space, she added. Recurate, a “white label service” that enables brands and retailers to tap into the resale revolution by selling pre-worn goods on their own sites, has “generated a lot of excitement” since it came through the Lab last cycle.
Another XRC Labs alum, interactive shopping platform ShopShops, has tapped into the livestreaming craze that has particularly taken hold in the Asian market, giving retailers and brands the chance to broaden their e-commerce strategies by showcasing store merchandise on video. The trend toward social shopping continues to grow, she said, especially during the pandemic as many shoppers have been sidelined from brick-and-mortar buying.
Another Covid-era winner is VisuWall, a platform that allows retailers and brands to rent out vacant storefronts and turn them into mobile billboards. “It’s incredibly valuable for landlords, especially as you’re starting to see more empty storefronts,” Chen said. “It’s a way to monetize and make that real estate valuable again,” even as many stores remained shuttered.
Chen believes that XRC Labs’ move to bolster minority founders could spur innovations with the capacity to rock the retail space, and that the investment will continue pay off as their own influence grows. “They will start to hire, and inspire, and we’ll see other founders of color rise up,” she said. “It’s really time to support this virtuous cycle of growth in our ecosystem.”