HBCU Seed will invest in eligible startups from US historically black colleges and universities at a time of heightened tension over racial inequalities.
US-based venture capital and private equity firm HBCU Seed has raised an initial $10.7m from unnamed investors to nurture startups from historically black colleges and universities (HBCUs), BlackNews has reported.
All HBCUs in the US have been invited to buy equity in the new firm in return for a minimum $100,000 investment.
HBCU Seed will exclusively back startups founded by eligible students, alumni, faculty and staff vetted by its entrepreneurship centre HBCU Seed Foundation.
The vehicle is the initiative of Terrel Davis, a serial entrepreneur who studied at Oakwood University, an HBCU in Alabama.
It comes amid renewed focus on US racial inequalities thanks to the Black Lives Matter movement and notable successes by HBCUs in challenging discriminatory institutional policies.
In March 2020, a US judge awarded four HBCUs in Maryland an extra $577m from state coffers after a legal dispute with authorities that had lasted more than a decade, according to the Guardian.
Other companies in the HBCU venturing ecosystem include HBCU.vc, a program enabling business students to seek equity-free funding or paid internships with VC and technology firms.
