like a child† Marceau Michel always asked for a quarter.
He knew that if he kept asking for a quarter, he would get a dollar one day. Then he’d be well on his way to having two – a slow but purposeful build up to making his own small fortune.
Today, at the helm of the Black Founders Matter venture fund, Michel has maintained that mindset. The fund today announced the creation of the 25 by 25 Promisethat encourages venture capitalists to commit to investing a quarter of their money in the female founders of BIPOC by the year 2025. The pledge also requires VC firms to have 25% of their workforce from BIPOC women, in the belief that increasing diversity behind the scenes will help drive more deal flow to marginalized communities.
“This is about changing the power dynamics in venture capital,” Michel told gotechbusiness.com. “You have to start with who is left behind and bring them to the starting line.”
Michel was inspired to start the pledge after realizing his own investments relied on black male founders. That led him to focus on investing in black women and adding five companies to round out his portfolio of 10. His new initiative hopes to encourage VCs to prioritize investments with diversity in mind as a way to improve the sector’s harrowing fundraising stats.
White women receive a marginal share of total venture capital funding, but the amounts received by minority women are much smaller. Last year, women made only 2% of the record $330 billion in venture capital. Of that 2%, less than 0.50% went to black women, about 0.51% went to the founders of Latina, estimated 0.71% went to Asian women, and only 0.004% went to native founders, according to Crunchbase data.
If a fund does not want to make this commitment, the question is why. Marceau Michel, founder of Black Founders Matter
“If more funds said, ‘I only want to see deals that are led by women,’ we would see more investment in women,” Michel said. “Black, indigenous and colored women make up the most women in the world. 25% questions [of investment volume] is not too much. I just see it as the beginning.”
The pledge is available on the Black Founders Matter website for those who want to draw.
The impact of a promise
The 25 by 25 Promise has a precedent: the 15 percent pledgelaunched in 2020 by fashion designer Aurora James.
The 15 Percent Pledge encourages retailers to spend at least 15% of their shelf space on black-owned businesses. So far, it has received pledges from 28 retailers, including Sephora and Nordstrom. The Pledge, now a non-profit organization, also created a database of 1,200 black companies to help companies find and build relationships with black founders. To date, the 15 Percent Pledge says Black ownership has helped companies generate $10 billion in revenue, and aims to generate $1.4 trillion in wealth for black entrepreneurs by 2030.