BBG Ventures has raised a new $60 million fund to support diverse founders. The firm is expanding its focus beyond just female founders to include those from various backgrounds, such as race, age, and income level. In the past, BBG Ventures focused on backing women-led businesses.
They believed investing in these founders would lead to strong outcomes in overlooked markets. Across their first fund’s portfolio, all companies had at least one female founder, and about 70% had a founder of color. The venture capital industry has seen a concerning trend of decreased funding for diverse founders.
Black founders secured just 0.3% of all capital raised in the first half of this year, according to senior data reporter Gené Teare. Nisha Dua, co-founder of BBG Ventures, noted that returning limited partners have increased their commitments for this new fund. New LPs include Melinda French Gates’ Pivotal Ventures and Fairview Capital.
Bbg Ventures expands focus beyond gender
BBG Ventures now manages $130 million in assets with over 100 investments. The second fund has already made seven investments, deploying 14.7% of its $60 million.
These include a recruiting platform for hourly workers and an infant formula brand. The firm conducted research on demographic and social shifts across race, age, and income. Several trends influenced their strategic shift, such as the widening wealth gap, an aging population, and Gen Z becoming the first “majority-minority” generation.
BBG Ventures sees this pivot not as a move away from female founders, but as a sign of where the U.S. is headed. They believe founders who can relate to their target audience could have a competitive advantage in today’s market. The new BBG fund will concentrate on diverse founders building solutions in healthcare, fintech, and artificial intelligence.
This move highlights the growing recognition of the need to support a wider range of entrepreneurial voices whose innovations could drive significant industry changes.
