Something new is on the horizon when it comes to investing in companies that are often overlooked and underserved, and these Black founders are helping to lead the charge.
According to Forbes, Westbound Equity Partners, a venture capitalist firm spearheaded by former nonprofit director Sean Mendy is on a mission to pour millions into companies led by Black, Latin, and diversity-driven founders.
“We aren’t investing in underrepresented founders as this altruistic thing,” Mendy told the outlet. “This fund is about investing in the best companies and performance. Explicit impact is what we’re doing on the foundation side.”
Since its inception in 2019, the firm formerly known as Concrete Rose Capital has managed to invest in over 40 startups as well as tap into what Mendy says is “the diversity opportunity,” which provides capital to underrepresented founders, especially Black and Latino companies.
What’s more, there is a key focus on startups with goals of serving their communities.
“If we can make the next Yahoo, the next LinkedIn, Facebook, or Google diverse in those early days, then the folks that build wealth are going to be more diverse, and they’re going to have the opportunity to go out and be deemed more investable as founders or become investors themselves,” Mendy said. “It transforms this vicious homogeneous cycle into a virtuous one that compounds over time.”
With an initial fund that totaled $25 million, Mendy and his team first wrote checks of “a few hundred thousand dollars,” according to Forbes. However, with the new $100 million fund they’ve launched, the goal is to make bigger placements, securing funding for startups during their early stages of development.
What’s more, the company’s new name is a nod to the Great Migration where millions of Black people in America were leaving the South and moving north and west during the 20th century for better opportunities. At the time, the South was implementing its Jim Crow laws and continuing a cycle of racism, which is still evident today.
Westbound has already invested in companies such as Sierra, an AI firm led by OpenAI chairman Bret Taylor, though the company has declined to share the size of investments it has received from backers, per Forbes. Another recipient of funding includes Esusu, a credit-building rent payments tool that is considered to be one of tech’s few Black-led billion-dollar startups.
Esusu Co-founder and Co-CEO Wemimo Abbey says that he has already recommended other founders looking for their next big break to Westbound.
“I fundamentally believe in what they’re doing,” Abbey shared with the outlet. “Founders of color, founders not of color, I will introduce any who will outperform, and whose values are aligned. That’s the most important thing.”
As Westbound continues what Mendy has referred to as an “equity mission,” he says the biggest win for the team is knowing that they’re helping underserved and underrepresented founders not only build great companies but also having that success spill over into their communities.
“We tell them, just by doing the work, by being able to focus on what you’re doing, you’re creating value that’s going back into the community,” Mendy said.
