Dealflow | May 8, 2018

Backstage Capital looks to raise $36 million for black female founders

Jessica Pothering
ImpactAlpha Editor

Jessica Pothering

ImpactAlpha, May 8 – Arlan Hamilton’s venture capital firm Backstage Capital has made a specialty of investing in underrepresented entrepreneurs to level the playing field for women and entrepreneurs of color.

For its new fund, Backstage is now focusing on an even more overlooked demographic: black women founders. “The rumors are true,” Hamilton tweeted from the United State of Women summit in Los Angeles. “My venture capital firm @Backstage_Cap has launched a $36 million fund that will invest in Black women founders $1 million at a time.”

“It is my firm belief that because Black women have had to make do with far less for centuries, equipping them with early-stage capital that is on par with their white male counterparts has the potential to lead to outsized returns,“ Hamilton said in TechCrunch.

Hamilton calls Backstage an impact investor because of its mission to channel more venture capital toward entrepreneurs from overlooked demographics. Backstage Capital doesn’t target startups for their social or environmental missions, however, nor publicly report impact metrics beyond the demographics of its portfolio companies’ founders. Since 2015, Backstage has invested more than $4 million in 80 startups led by women, LGBTQ people and founders of color.

  • Recent deals… Backstage invested in Thurst, “a dating app for queer people of all genders” and in travel app Localeur, as well as Novoron, Solstice and Pilotly, which ImpactAlpha previously reported.
  • Bigger tickets… With this fund, Backstage intends to do 15-20 deals of an average $1 million in size, a big jump from its original intention to write checks of between $25,000 and $100,000.

Read more about “The VC taking cold calls from underestimated entrepreneurs,” in ImpactAlpha’s New Revivalists series.