In June 2021, three outstanding Black media executives joined forces to launch Group Black, a collective that aimed to safe promoting commitments from manufacturers and companies and direct the spend to a portfolio of Black-owned publishers.
At launch, founders Richelieu Dennis, Bonin Bough, and Travis Montaque introduced an preliminary funding of $75 million from the company GroupM, and multimillion-dollar offers with firms together with Ziff Davis and NBCUniversal quickly adopted. Finally, Group Black pledged its intent to lift and distribute $500 million in funding.
In its early years, the enterprise generated breathless press protection—a few of which got here from yours actually—and loved the backing of highly effective manufacturers and holding firms, thanks in equal half to its charismatic founders and the heightened local weather of social activism popping out of the pandemic.
By 2024, the corporate had grown quiet. The collective had ostensibly raised a whole lot of hundreds of thousands of {dollars} for a cadre of Black media retailers, however I more and more started to listen to grumblings of late funds.
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That summer season, Montaque, the wunderkind chief govt and founding father of messaging know-how service Holler, quietly left Group Black.
Dennis, who made his fortune by promoting his private care firm, Sundial Manufacturers, to Unilever in 2017 for $1.6 billion, left the collective shortly after. He had more and more begun to deal with constructing out a separate media portfolio, known as Sundial Media and Know-how Group, which incorporates publishers like Essence, Refinery29, and Afropunk, amongst others.
The departures left Bough as the only remaining cofounder. Then the lawsuits started.
The primary, in October 2024, was filed by Essence Communications, a subsidiary of Dennis’ Sundial Media and Know-how Group. It alleged that Group Black owed two of its publishers, Essence and Afropunk, $20 million in unpaid payments and had improperly used these funds to complement Group Black and Holler, as Enterprise Insider first reported.
That lawsuit has since been dismissed. However new litigation has emerged in current months, which I used to be capable of get my arms on and which has not been beforehand reported.
Two new lawsuits—a lawsuit filed by Essence Communications and countersuit by Group Black—have been filed in Might and June of this 12 months and are nonetheless lively. Bough, Dennis, and Montaque every declined to remark, citing the continued litigation.
The paperwork that surfaced on account of the litigation have shed new mild on the interior drama roiling the corporate. In addition they reveal, for the primary time, the complexity of the Group Black portfolio and the competing pursuits that at the moment are threatening to tear it aside.
He mentioned, he mentioned
What each events can agree on is that, between 2021 and 2023, Group Black organized for Essence and Afropunk to execute hundreds of thousands of {dollars}’ price of promoting campaigns, which they did.
Within the go well with filed in opposition to Group Black this Might, Dennis’ group makes lots of the identical allegations as earlier than and claims $7 million in missed funds. It additionally claims that Group Black had the cash to pay Essence and Afropunk, however as a substitute used it to put money into Group Black and Holler, the messaging platform based by Montaque.
In its countersuit, Group Black alleges that whereas it did certainly owe Essence and Afropunk $7 million, Dennis had agreed in January 2024 to transform that $7 million debt into fairness in Group Black. Then, after a fallout that occurred in the summertime of 2024 when Dennis left the corporate, he modified his thoughts and determined to sue for the cash, the countersuit alleges.
Group Black cited emails that point out Carta, a software program used to construction capital tables, in corroborating these claims. Certainly, turning a $7 million debt into fairness would allow Group Black to speculate that cash again in its enterprise, a typical tactic for startups.
It did make investments that cash, in response to the countersuit, buying Holler in December 2023, and investing $14.5 million within the messaging platform.
A tangled net
As you may need picked up on, a lot of the melodrama right here stems from the entangled nature of the assorted companies concerned.
Dennis was chairman of the board of Group Black through the time it allegedly withheld funds from Essence and Afropunk.
And till his resignation in 2024, Montaque was the CEO of each Group Black and Holler through the time that Dennis’ group alleges Group Black withheld funds with the intention to put money into Holler.
However in a twist, Dennis was additionally a big investor in Holler. That signifies that—and attempt to sustain right here—Dennis is suing Group Black, an organization he cofounded and led as chairman, for alleged nonpayment to Essence and Afropunk, firms he now owns, as a result of Group Black had allegedly used the owed funds to put money into Holler, an organization during which he had invested.
Holler’s belongings are nonetheless owned by Group Black, although the messaging platform is now not lively. Its former URL now directs to a Vietnamese streaming web site.
An unsure future
On reflection, the commingling of those varied enterprise pursuits now looks like a fraught proposition. On some stage, the businesses merely seemed to be handing across the identical greenback in a circle.
This type of monetary maneuvering just isn’t unusual amongst startups, the place money is in brief provide and the main focus is on constructing one thing reasonably than turning a direct revenue. Plus, Essence, Afropunk, and Holler are the precise sort of firms that Group Black was attempting to assist—even when their homeowners occurred to profit from that assist.
Sadly, on this case the tripartite administration of the corporate, mixed with every founder attempting to serve each the pursuits of their portfolio firms and the pursuits of Group Black, appears to have backfired.
Group Black, to its credit score, continues to be alive and kicking. Bough is operating the corporate now, and final month he introduced the launch of Portrait, a enterprise with a mission just like Group Black however with a deal with minority audiences extra broadly. Group Black will now turn into Group Black Holdings, Bough mentioned in a LinkedIn put up.
Personally, I hope that Group Black can persist. It was and is a company with an necessary mission, nevertheless muddled which may have turn into amid this energy battle. Through the years I’ve spoken with dozens of Group Black staff, and all the way down to the one all of them believed within the work they have been doing—a refreshing anomaly in an usually disillusioned business.
I do know that for a lot of within the Black media neighborhood, Group Black has been at instances a polarizing group. Some operators believed it sucked up all of the oxygen within the room after which didn’t execute on its core promise. However most Black media executives I’ve spoken to are conflicted on the difficulty: vital of its operations, however nervous its failure would have an effect on funding for different Black media firms.
For the second, the fallout from the state of affairs is at the very least contained to its inner stakeholders. But when Group Black itself collapses, the blast radius of its implosion may very well be a lot wider.
