By Christopher Pitts
- Base10, co-founded by Adeyemi Ajao is back with a $250M investment fund
- Of the estimated $136.5B in venture funding that went to tech startups in 2019, Black-founded companies received just 1%
Base10, the largest Black-led venture capital firm is making a play to promote inclusive entrepreneurship. Two years after having closed its initial fund of $150 million, Base10 is back with a $250 million investment fund. Co- founded by Nigerian-born Adeyemi Ajao, the firm is doubling-down on a commitment to diversity through its investment process, which includes automation for the real economy, or “problems that are really important to the 99% of people.
Why This Matters: It isn’t news the lack of diversity in venture capital and tech. African-Americans make up more than 13% of the U.S. population, but represent only 3% of investment partners at venture firms, according to a survey by the trade group the National Venture Capital Association. What makes matters worse is that of the estimated $136.5 billion in venture funding that went to tech startups in 2019, Black-founded companies received just 1%, according to the Transparent Collective.
African-Americans make up more than 13% of the U.S. population, but represent only 3% of investment partners at venture firms
What makes Base10’s venture capital fund unique is its diversity pledge, which includes a commitment of 1% of the firm’s profits from its management company and another 1% commitment of its carried interest to support organizations fighting for inclusion and racial equality. Although Ajao insists that the firm is minority led, but not minority focused, he still promotes the belief that investing in minorities is good business.
This new investment fund is timely, as we are still in a space of all-white firms that claim they are not able to find any back founders. Of course, this couldn’t be farther from the truth as we know that women of color are starting businesses at an outstanding rate. Between 2007 and 2008 the number of black-women firms that were started was up 164%.
Situational Awareness: What we know is already obvious that structural racism is leading to an unequal pipeline of black founders being visible and ready for investment. Through prominent universities such as Georgia Tech, Emory, Spelman and Morehouse College a structural system is in place to aid young black professionals to eventually prosper in any entrepreneurial endeavor.
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