SoftBank has created a $100 million Opportunity Fund to invest in diverse entrepreneurs. (Courtesy flickr)
SoftBank, one of the largest tech investment companies in the world, announced Wednesday it would put up $100 million of its own capital to create an Opportunity Fund for diverse entrepreneurs.
Marcelo Claure, SoftBank Group International CEO, told CNBC’s Squawk Box that it was about time the company used its position of privilege to benefit people who have been marginalized for centuries.
SoftBank’s Opportunity Fund is spurred by the global uprising for black justice. The fund is open to all entrepreneurs of color, including Native American small business owners who face unique and systemic challenges. Beyond the health disparities and socioeconomic factors that disproportionately plague Tribal communities, Native entrepreneurs face the added challenge of limited access to investment capital and financial education. Traditional banks won’t accept reservation-based assets as collateral for loans. Businesses located within Native communities also tend to encounter a lack of technical infrastructure and support. Economic disparities and equity challenges have only been amplified amid the current COVID-19 crisis.
Claure will co-lead the fund alongside SoftBank partner Shu Nyatta, according to TechCrunch. They will be joined by Paul Judge, founder of TechSquare and chairman of Pindrop, and Stacy Brown-Philpot, CEO of TaskRabbit, and the first to be named to the investment committee.
“Taking action right now is the most important thing that we can do,” Marcelo said. “Opening a fund of this size will not only give us access to more founders and entrepreneurs, but also help … those black founders and entrepreneurs who already started companies actually grow those businesses to the size and scale that we need to see the change that we want in our world.”
About the Opportunity Fund:
- Only invest in companies led by founders and entrepreneurs of color
- Initial size of fund will be $100M
- Investments can be added
- SoftBank will be primary limited partner
- SoftBank will not take a traditional management fee
- Focus on companies that use technology to disrupt traditional business models
Entrepreneurs can get in touch with Claure at [email protected] to discuss Opportunity Fund possibilities.
The Opportunity Fund leaders also expect their team to be a diverse one. “Diversity is hugely important. If we want to change the face of technology, we have to do it from the top,” Brown-Philpot told Squawk Box. “This is a collective effort, and it has to be a collective diverse effort to really make this happen. So the team that will be making decisions on investing … will be a diverse team in order to get access to the talent that is out there across our country.”