A new venture capital fund of funds, The Historic Fund, formally launched its inaugural $10M+ fund on June 1, 2023 to support the endowments of Historically Black Colleges and Universities (HBCUs), including Bennett College. The fund is the brainchild of a group of prominent investors and operators in the venture capital ecosystem who recognize the importance of HBCUs and their role in promoting equity and inclusion in higher education.
The Historic Fund is a unique philanthropic initiative that invites selected HBCUs to be limited partners without investing their own assets. Instead, the fund raised capital from partners of the participating funds: Acrew Capital, B Capital, Cowboy Ventures, First Round Capital, FirstMark Capital, Foundry, General Catalyst, Spark Capital, and Union Square Ventures. The fund will also support a variety of under-represented fund managers via its stake in First Close Partners, a venture fund with the mission of making venture capital more inclusive that invests in funds led by underrepresented managers. The schools will function as traditional limited partners in a venture capital fund and will be free to use the returns as they wish.
The goal of the fund of funds is not only to bolster the endowments of HBCUs, but also to foster connectivity between these institutions and the broader venture capital community. Historically, opportunities in venture capital, both for funding and for employment, have been concentrated among graduates of a small number of universities. The Historic Fund hopes to leverage its position at the intersection of the HBCU community and the venture capital community to develop programming that will expand opportunities for students curious about entrepreneurship and innovation, as well as support administrations exploring alternative asset class strategies with their endowments.
“As we continue to combat the racial inequities that Black students face, The Historic Fund aims to relieve the disproportionate financial pressure on Black families, while also providing essential funding for research and innovation at each of these institutions,” said Ken Chenault, chairman and a managing director of the venture capital firm General Catalyst, and the former chairman and CEO of American Express.
The inaugural cohort of HBCU partners will be Benedict College, Bennett College, Fisk University, Florida A&M University, Hampton University, Morehouse College, Virginia State University, Virginia Union University, and Xavier University of Louisiana.
Suzanne Elise Walsh, JD, President of Bennett College, says, “The Historic Fund gives Bennett College, and other participating HBCUs, the ability to grow our endowment in ways we never imagined. It opens us up to new opportunities. This model of investing in HBCUs, where we receive the interest benefit, is a very interesting model for endowment growth and fundraising, and The Historic Fund provides a very exciting opportunity for potential investors.”
At the helm of this effort is a group of esteemed professionals in the innovation ecosystem who are passionate about improving access and equity in the world of venture capital. The initiative has benefited from the guidance and support of Dr. Regina Benjamin, a founding partner of First Close Partners and former Surgeon General of the United States; Ken Chenault, Chairman and Managing Director at General Catalyst; Josh Kopelman, Managing Partner at First Round Capital and founding partner of First Close Partners; Megan Maloney, Managing Partner at Dria Ventures; Samson Mesele, Partner and General Counsel at Union Square Ventures; Ekwutozia Nwabuzor, Counsel at Lowenstein Sandler; Adanma Raymond, the fund’s Executive Director; and Ed Zimmerman, Tech Group Chair at Lowenstein Sandler and founding partner of First Close Partners.
Notable partners and supporters of The Historic Fund include Lowenstein Sandler, The Philadelphia Foundation, Aduro Advisors, Passthrough, and the Student Freedom Initiative.
Mark Brown, Chief Operating Officer of Student Freedom Initiative, says, “We are grateful for our collaboration with The Historic Fund because our mission is to close the wealth gap in America through the lens of education. The endowments of HBCUs are significantly lower than that of other universities that may not have faced similar historical biases. We added up the endowments of 70 percent of the HBCUs and still did not have a total greater than the smallest endowment of our nation’s Ivy League schools. We know there are systemic reasons for this wealth gap, and The Historic Fund is aptly named and focused on helping bridge this gap.”
For more information on The Historic Fund, please visit www.historicfund.org, or contact Executive Director Adanma Raymond at firstname.lastname@example.org.
Read the recently released Axios article.