SoftBank is rolling out a $100 million loan fund targeted exclusively at minority-led startups, in the latest move by a big corporate player to address racial inequities in the United States amid coast-to-coast protests over police brutality.
In a widely-reported letter to employees, Marcelo Claure, SoftBank’s chief operating officer, noted that the new Opportunity Growth Fund “will be the biggest fund providing capital to black Americans and people of color.”
Overseeing the fund will be Claure, a number of prominent black executives from Silicon Valley, and Shu Nyatta, a managing partner at SoftBank’s Latin America-focused Innovation Fund.
SoftBank has indicated it will not charge the traditional management fee, and that half the money generated by investments will be reinvested into further growth opportunity funds, with an additional amount donated to organizations working to promote opportunities for people of color.
“We have to put money behind it, set plans and hold ourselves accountable,” Claure wrote.
The initiative by Tokyo-based SoftBank comes in the wake of nationwide protests following the killing of George Floyd, an unarmed black man, by a white police officer in Minneapolis.
SoftBank’s initiative follows a similar and even bigger initiative by Bank of America, which has announced a $1 billion, four-year program aimed at addressing “economic and racial inequity.” The BofA program will provide support for minority small businesses, as well as money for virus testing and affordable housing.
In his letter, Claure noted that just 1 percent of venture capital-backed company founders are black, Bloomberg reported.
“Founders and entrepreneurs of color have so much potential, but they face unfair barriers that white founders don’t face,” he wrote in his letter to SoftBank employees. “This is our opportunity to remove those barriers for a new generation of founders.”