Roughly two years after completing fundraising for its first venture capital fund, D.C.'s Zeal Capital Partners has disclosed plans to launch a second fund that could be twice as large as the first.
In a filing submitted to the Securities and Exchange Commission May 11, Zeal said it is looking to raise $120 million for what it has labeled Zeal Capital Partners Fund II LP. The 3-year-old firm, which focuses in investing in startups run by diverse entrepreneurs, pulled in $62.1 million in its oversubscribed first fund that was closed in mid-2021.
Zeal indicated in last week's filing that it has not yet raised money for the second fund. It did not respond to the Washington Business Journal's requests for comment about its plans, though that not unusual as companies are limited in what they can say publicly while actively fundraising.
The firm was created to invest in early-stage companies whose founders, because of background, gender, ethnicity, geography or experiences, are often overlooked by traditional investors. According to data from Crunchbase, only 1% of VC money in 2022 went to firms whose founders are Black.
With its first fund, Zeal focused on investing in early-stage fintechs and other startups with diverse management teams. It was an early investor in Esusu, a fintech that help immigrants and people of color build up their credit and which recently raised $130 million in a Series B round. It has invested in 17 companies in all, including two D.C. fintechs Wellthi and EQL Finance Inc., focused on money management and wealth building.
Zeal's founder and managing partner, former AT&T executive Nasir Qadree, said in a recent interview with the Washington Business Journal that now is "inflection point" for his fledgling venture capital firm. The firm recently hired its first-ever chief operating officer to held lead recruiting and implement formal human resources policies while managing day-to-day operations and scouting for more investments.
“We're going to be executing a strategic plan to turn this from a fund into a company,” Qadree said.
