ImpactAlpha, September 19 — Baltimore-based RareBreed Ventures, Oregon’s Rogue Women’s Fund and VitalizeVC in Chicago are combining efforts to raise a collective $10 million for first-time funds through a special purpose vehicle, or SPV. The big idea: The SPV helps pool capital from smaller investors that wouldn’t typically meet the required minimum commitment for larger funds.
Kauffman Fellows McKeever “Mac” Conwell (RareBreed), Caroline Lewis (Rogue Women’s Fund) and Gale Wilkinson (VitalizeVC) lead the funds, which back overlooked founders to close wealth gaps in the U.S. Conwell told Maryland Inno that the vehicle will allow investors “to spread the risk across three separate funds because you’re investing in all three of us.” The SPV will lower the minimum investments to $10,000 each year over four years for investors.
The SPV will operate as a separate entity from the three participating venture firms, which hope to bring together a more diverse group of investors and overcome their fundraising challenges. The pooled vehicle is the latest innovation from emerging and diverse fund managers who are getting creative to overcome historic barriers to raising first funds.
Backstage Capital, New Majority Capital and other emerging impact fund managers are tapping non-accredited investors for capital through ‘community rounds.’