D.C.-based Rethink Impact, the engine behind a local consortium investing in female-led startups, said Thursday it has closed a new $182 million fund — bringing its total assets under management to $300 million.
The venture capital firm, started five years ago by native Washingtonian and former tech startup CEO Jenny Abramson, has backed by more than 25 companies while aiming to help women entrepreneurs and other diverse founders gain equitable access to capital.
The new fund — Rethink Impact’s second — comes at a critical moment for the country, amid an overdue call for equity in the wake of George Floyd’s killing and in the age of coronavirus.
“An unfortunate side effect of the Covid-19 pandemic has been the decline of diversity efforts in the venture industry,” Abramson said in a statement. In the first quarter of this year, the percentage of female-led, VC-funded deals dropped 40% year over year, she said, citing PitchBook.
“While admittedly it’s hard to break into networks that make up the venture landscape during this quarantine environment, the result is that female founders are being left out at a time when their ideas are needed most,” Abramson said. “We believe there is tremendous opportunity to use private sector tools to drive positive, inclusive change and now is the time to address these market blind spots and double down, not lean out.”
The new fund, which The New York Times reported surpassed expectations, comes amid other local efforts to support female founders and founders of color — including Citrine Angels, a D.C. angel group now a year in, Halcyon, which is raising a fund of its own, and others. Rethink Impact’s investor base has 65% females from Melinda Gates’ Pivotal Ventures, Ford Foundation, W.K. Kellogg Foundation and others. And despite efforts to improve diversity in the VC industry, the work is far from over.
“There is much to be done, and the investment community — and society as a whole — are missing out by not incorporating broader points of view into which ideas get funded, which problems get solved, and which communities benefit [or don’t],” said Rethink Impact Managing Director Heidi Patel in a statement.
The venture fund focuses on startups across the country taking on challenges in health care, environmental sustainability, education and economic opportunity. It also fuels WE Capital, a female consortium built to bring attention to the gender disparity in VC dollars. That D.C. effort launched in November 2016, with Sheila Johnson and Sachiko Kuno as its public faces. It has a growing roster of portfolio companies and other initiatives under its belt to support female-led startups that focus on social impact work.
Editor’s Note: This story first appeared in the Washington Business Journal. See the original post here.
