Indianapolis-based venture capital firm Sixty8 Capital has announced the close of its first $20 million venture fund aimed at supporting diverse founders.
Investors in the fund include The Indiana Next Level Fund, 50 South Capital, Bank of America, Eli Lilly and Company, First Internet Bank, and the Central Indiana Community Foundation. The fund is supported by Allos Ventures which invests in early-stage technology companies based in the Midwest.
Sixty8 Capital is looking to invest between $250,000 to $500,000 in 25 to 30 pre-seed and seed-stage companies led by Black, Latinx, women, and LGBTQ+ entrepreneurs. Additional funds have been reserved for follow-on rounds.
The fund has seen Sixty8 Capital’s co-founder and managing partner Kelli Jones reportedly become the first-ever Black, female VC in the state of Indiana. She has previously spoken of her desire to create more opportunities for underrepresented founders.
It’s estimated that venture firms in the United States invest over $130 billion annually. However, figures show that Black founders receive less than one percent of venture capital funding. Furthermore, only 3% of venture capital investors are Black.
Startups led by all-female founding teams receive just 2.3% of VC funding.
Speaking to UrbanGeekz Jones said: “Sixty8 Capital will invest in Black, Latinx, Women, and LGBTQ founders across the Midwest. We expect to have a deep impact right here in Indiana, but also plan to invest in the South and Southeast. I’m an HBCU grad – Tennessee State University – so I want to make sure I support founders in the South as well.”
Jones added that, in her view, startups led by diverse founders could provide significant returns for venture capital investors.
“I think the opportunity is huge,” she said. “We have trillions in buying power. When diverse teams are prioritized revenues increase and exit multiples increase. We solve problems that many don’t identify or understand. We are culture. In addition, there is a huge number of Black entrepreneurs who are not considered to be ‘venture backable.
“But coming off of a global pandemic many small and medium-sized businesses have had to pivot to more tech and tech-enabled solutions in order to stay in business. Right now they may be just selling hair care or facial products, but if they are creating a demand and revenue, venture capital can help them scale. This could uncover deal flow we’ve never even attempted to look at. What happens when we help them think about high-growth, high-scale businesses? What if we could produce the next Black Warby Parker?”
Speaking further about how Sixty8 Capital will help develop the potential of diverse founders, Jones said: “We have to help lift the veil on how these founders can connect with VCs. Even if we don’t invest now, we can still listen.
“Maybe they’re not quite ready to fundraise, but we can help them get there. Or maybe now is the right time for Sixty8 Capital to invest, and that founder will have the chance to show everyone how far they can take their idea, regardless of whether it’s in SaaS, media, CPG, or e-commerce. We want to find the diverse founders that traditional VCs are overlooking.”
Sixty8 Capital’s name is inspired by the political events and civil rights legislation of 1968. Jones is also the co-founder of Be Nimble, a non-profit that Jones founded in 2017.
Be Nimble trains people from underrepresented communities in technology and helps place them in high-paying tech careers ranging from coding to sales. The non-profit also guides startup entrepreneurs through business accelerators, workshops, and pitch competitions.
Kelli Jones, co-founder and general partner Sixty8 Capital (photo credit: Cheddar)