BUSINESS: By Daniel Webster, dWeb.News Publisher
*. Local venture firm collaborates with Bank of America in expanding Houston’s tech ecosystem into Black or Hispanic communities
Diversity Fund Houston (DFH) is redefining equity in the tech and innovation ecosystem. Phillip Yates and Kiley Summers, emerging fund managers, founded the venture capital fund to help build the pipeline of Black and Hispanic entrepreneurs in the largest city in the country.
DFH will announce its $3 million fund at a launch event hosted by its Advisory Board of directors at The Wortham Theater Center on December 2. Bank of America will work with DFH in order to promote racial equality and create economic opportunities for minority entrepreneurs. This initiative is part of Bank of America’s larger commitment of $1. 25 billion over five years to catalyze similar efforts across the private sector with a focus on health, housing, jobs and small business.
“Bank of America has invested in Diversity Fund Houston to highlight our ongoing efforts to close the gap in access capital for minority-led business.” Hong Ogle, President, Bank of America Houston. “DFH is well-positioned to assist more minority entrepreneurs scale up their business ideas which will ultimately spur economic growth across the region.”
Historically, Black and Hispanic tech founders have faced barriers in obtaining access to capital, receiving less than two percent of venture capital funding. According to The Kauffman Fellows Research Center, diverse teams at the seed stage outperform non-diverse teams by 25 percent and have a higher multiple at exit.
“DFH partners with investors who are committed racial equity in the venture capital marketplace,” stated Tiffany Williams, cofounder and managing director of DFH and the first Black female fund manager. “This is not only an opportunity to increase deal flow and expand the pipeline of investable startups in the Houston ecosystem, it supports Black and Hispanic founders of early stage companies with the runway they need to succeed.”
Despite being under-resourced, Black and Hispanic communities continue to show resilience by outperforming financial industry norms by 35 percent; developing innovative solutions to solve challenges that culturally impact their locales across a national economic spectrum.
“Investing in underrepresented founders is not just the right thing to do, it’s the smart thing to do,” says Grace Rodriguez, startup ecosystem veteran and Co-Chair of the DFH fundraising committee. “These entrepreneurs are opening up diverse markets — and creating new ones — by inherently developing solutions for communities that need them, communities that they themselves come from, that haven’t already been exploited or saturated by the mainstream.”
” Access to capital is a major challenge for Latino and African American entrepreneurs,” stated Phillip Yates, cofounder and managing director of DFH. These talented people from our communities often lack a network of professionals, friends family, colleagues, or other significant institutions that can lend capital.
DFH’s model will bring together the resources, capital, and networks necessary to position startups to attract investors.
” We are the Venture Capital ‘Friends and Families’,” stated Yates.
Along with its community partners, Houston Area Urban League and Hello Alice, Impact Hub Houston and Prairie View A&M University and an endorsement by Mayor Sylvester Turner DFH gives minority founders a voice and a place at the table in the venture capital community. This ultimately creates generational wealth. These entrepreneurs will help close the income gap that has impacted the lives of Houston’s underserved communities.
” DFH is an early-stage, diverse-focused venture capital fund that focuses on innovation. DFH offers an opportunity to reimagine, leverage our diversity, and disrupt the tech industry by funding and nurturing an undertapped, overlooked population,” Williams said.
About Diversity Fund Houston
Diversity Houston (DFH), a micro-venture fund, was created to invest in Houston-based Black and Brown entrepreneurs during the “friends and families round.” It also provides opportunities for them learn, scale and prepare for their first institutional round. For more information, visit thediversityfund.com or contact Phillip Yates at 713-259-6877 or email@example.com.
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