SoftBank is putting its money where its mouth is.
The Japanese investment conglomerate has revealed plans for a new $100 million fund that “will only invest in companies led by founders and entrepreneurs of color,” according to Axios.
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SoftBank COO Marcelo Claure apparently shared the news of the Opportunity Growth Fund in a letter to employees this morning.
Considering that SoftBank has made headlines for less than favorable reasons as of late, the fact that the firm is one of the first to actually announce a new fund dedicated to funding people of color is well, notable.
For those of you who are not aware, SoftBank has been dogged for overinflating valuations with its fat checks. A number of its portfolio companies over the past year have laid off (Zume), shut down (Brandless) or endured some other scandal (WeWork).
But SoftBank is also the same firm that unveiled plans last year for a $5 billion SoftBank Innovation Fund, or what it described as “the largest-ever technology fund focused exclusively on the fast-growing Latin American market.”
As reported, the Opportunity Growth Fund immediately puts a significant amount of capital to work for businesses owned and operated by people of color.
According to Claure’s letter, the fund will invest in “companies that use technology to disrupt traditional business models,” and will donate an unspecified portion of gains from the fund’s investments to organizations focused on “creating opportunities for people of color.”
A company spokesperson told Axios that companies have not yet been identified to add to the portfolio, nor has capital been dedicated.
In addition, Claure wrote that SoftBank would not collect its traditional management fee on the fund and will reinvest 50 percent of the gains into future programs with similar focuses.
Illustration: Li-Anne Dias