Collab Capital Fund I was raised over the last 18 months.

Justin Dawkins, Jewel Burks Solomon, and Barry Givens founded Collab Capital in 2018 to solve the problem of capital access for Black entrepreneurs. Collab began raising its first fund in 2019 and after 18 months, the firm announced Wednesday that it had closed its Collab Capital Fund I with $50 million in the bag to invest in Black-founded startups. (Medium)

Undeterred focus

“When we began fundraising in 2019, many people told us that focusing exclusively on Black founders was too narrow and that we would not be successful in raising the fund or finding enough qualified Black founders to back,” writes Solomon in a Medium post. “We never wavered from our mission, and are proud today to be in a position to write meaningful first checks.”

Collab’s first fund has the support of 99 Limited Partners including Apple (NASDAQ: AAPL), Goldman Sachs (NYSE: GS), Google (NASDAQ: GOOGL), Paypal (NASDAQ: PYPL), Kapor Capital, Mailchimp, and others.

Investing process

Funds will go to 50 Black-led companies over a three-to-five-year period with check sizes between $500,000 and $750,000. The firm has also earmarked up to $2 million per investment for follow-on funding. It is targeting ownership between 10% to 15% in each deal.

Geographically, most investments will flow to start-ups in Collab’s hometown of Atlanta and in cities like, Houston, Detroit, St Louis, and New Orleans, which have “a high concentration of Black entrepreneurs and a low concentration of risk capital.”

Sector focus is on technology related to the future of work, learning, and care (that is elder care, fem-tech, and mental wellness). “Black folks are often the most marginalized in each of these areas and therefore are more likely to have experience and perspective that can lead to the best, most inclusive solutions,” observes Solomon.

Existing investments include Atlanta startups Hairbrella, Music Tech Works, and Jax Rideshare along with DC-based Please Assist Me.

Related Story:  Collab Capital Makes Profit-Sharing Investments, and Only in Black Founders