Corporate Venture Capital | March 4, 2021

Chicago-based venture funds aim to bridge funding gaps for overlooked founders

Roodgally Senatus
ImpactAlpha Editor

Roodgally Senatus

ImpactAlpha, March 4 — Three-quarters of the record $130 billion in U.S. venture capital funding last year went to startups in California, New York and Massachusetts. Chicago Ventures, Lightbank and Cleveland Avenue are all looking to even the playing field with new funds based in and focused on the midwest. 

Chicago Ventures Fund III raised $63 million to lead seed investment rounds in overlooked founders whose ideas other investors dismiss as “unscalable, niche and unproven,” said Chicago Ventures’ Lindsay Knight.

Lightbank II secured $180 million from institutional, family office and high-net-worth investors to make pre-seed, seed and Series A investments in midwest climate and other tech startups.

Cleveland Avenue raked in $70 million for its Cleveland Avenue State Treasurer Urban Success fund, or CAST US. The impact fund is targeting Black, Latinx and women-owned businesses specifically in Chicago’s South and West side neighborhoods.

The Illinois Growth and Innovation Fund, a billion-dollar impact investing vehicle created by State Treasurer Michael Frerichs, committed $16 million. Benefit Chicago, a collaboration between the McArthur Foundation, Chicago Community Trust and Calvert Impact Capital, invested $10 million.