Reinventure Capital Re-Envisions The Venture Capital Market To Bridge Racial And Gender Wealth Gaps – Forbes

Reinventure Capital is among the financial firms leading by example and applying a racial and gender … [+] equity lens to its investments.

Reinventure Capital

As venture capital investments hit record heights with each year in the United States — topping $330 billion in 2021 — most of that funding continues to go to companies led by white men, a disparity that exacerbates the country’s racial and gender wealth gaps. These gaps have continued to grow in recent decades, with long-term implications: the average Black or Hispanic household brings in about half as much in earnings each year as the average white household, and Black and Hispanic households have 15% to 20% as much net wealth, according to the Federal Reserve. The numbers are even more stark for women of color, who have far lower incomes and savings amounts for a variety of reasons.

Especially in recent years, more people in the financial industry are realizing the need to use their influence — and their funding — to address these gaps. Reinventure Capital is among the financial firms leading by example and applying a racial and gender equity lens to its investments. The firm was founded in 2014 by Edward Dugger III, a pioneer in the impact investing field who continues to push for bigger and broader changes and driving funding toward overlooked and underfunded entrepreneurs.

Julianne Zimmerman, Managing Director at Reinventure Capital, says the firm invests with a goal of creating opportunities for and advancing the innovations of women and People of Color — and a broader view of shifting the VC system toward greater equity and inclusion. “What that comes down to is who has authority, who has a say, who has control, who has ownership,” she says. “When you look at the distribution of capital, consistently more than 90% of venture capital goes to an extremely narrow demographic — in broad strokes, straight, white, U.S.-born men from a dozen universities.”

That concentration of capital lands primarily in a half-dozen metropolitan areas, she says, further exacerbating inequities. “It also means that we have this perilously unbalanced means of propagating ideas and value propositions and technologies and services,” Zimmerman says. “They’re only coming from and validated by and, for the most part, serving that same demographic. That has all manner of ramifications: social, environmental, health, but also economic.”

While Zimmerman acknowledges that Reinventure Capital’s work represents a small portion of the overall VC market, she says their work is designed to inspire more investors to also realize the importance of acting to avoid those ramifications on people and the planet. She shared more about Reinventure Capital’s strategy and vision with me during a …….