A Black-Led Venture Capital Firm Bets $15M on BIPOC Female Entrepreneurs
Arkansas’ first and only Black-led venture capital firm will invest a $15 million inaugural fund in boosting tech-driven companies led by Black, Indigenous, and People of Color (BIPOC) female entrepreneurs, a group badly underrepresented in venture capital funding.
“Our partners realize that these women and diverse founders, there is such a huge gap and doesn’t necessarily need to be there because great founders and great returns can come from anywhere throughout the heartland,” said Shannon McFarland, Director of Communications and Venture Associate for High Street Equity Partners.
While women and Black, Indigenous, and people of color make up the fastest-growing demographic of entrepreneurs and consumers, women raised only 2% of the record $330 billion in venture capital in 2021. Of that 2%, less than 0.50% went to Black women, approximately 0.51% went to Latino founders, roughly 0.71% went to Asian women, and a meager 0.004% went to Indigenous founders, according to Crunchbase data.
High Street believes that these overlooked entrepreneurs represent a significant market.
“Women produce better companies. It’s proven not only financially that they do better. They not only see larger returns, but they come up with better ideas because they see the pain points the community is having and are tapping into that,” said McFarland. “So, we’re investing in products and services that we believe in and are driving to make a difference and impact the community.”
In addition to closing the gap between BIPOC entrepreneurs and funds, High Street wants to create value beyond capital for these companies. They want to ensure that their portfolio companies reach their full potential; that’s why, in addition to funding, companies are supported through the founders’ operational, financial, and policy expertise.
“Even though capital is number one and we’re writing the check, we also have this expertise and this operational sense that can help companies drive their returns and bottom line. We’ll be there to support in whatever way the founders need,” said McFarland.
Companies looking to work with High Street must meet specific criteria to receive funding. To work with High Street, entrepreneurs must be:
- From a marginalized community
- Making at least $100,000 in revenue a year
In addition to this criteria, High Street is mainly looking for health, fem, and clean tech and the future of work.
To apply, entrepreneurs must visit the High Street website, click the “Pitch” button, and fill out an application. After being evaluated, those that meet the initial criteria will be contacted via email to schedule the first meeting. After the second pitch, the company will undergo a second round of evaluation to determine whether the firm will invest or not. On average, the entire process from application to investment will take about six months to complete, said McFarland.
High Street wants entrepreneurs to know that the door is open even if the entrepreneur does not meet the criteria.
Founders who don’t immediately meet the criteria can sometimes be invited into a founder’s checking, where they will meet with High Street monthly or bi-monthly and set up KPIs to shape the company into a more attractive investment. After a couple of months, the entrepreneur can be re-evaluated.
“That’s what we want Arkansas founders to understand is that we are there for you. Even if you’re not in the position to receive venture capital, you can still get venture capital insight on High Street. Right here,” said McFarland
As part of the inaugural fund, High Point has already invested in Happied, an enterprise software company focused on employee wellness and retention through engaging corporate events, ChargerHelp, a leading technology utility company and job creator in the emerging field of electric vehicles, and Campus Inc, a legacy print and apparel business that is college-campus focused with B2B and B2C sales channels.