MINNEAPOLIS-SAINT PAUL, MN - The Forge North startup coalition announced the first close of the MSP Equity Fund – the first-known venture capital fund of funds in the country designed to invest across race, place, and gender.
Powered by gener8tor and the GREATER MSP Partnership, the fund will invest in leading local and national venture-capital funds that commit to investing a portion of their capital into high-growth startups led by Black, Brown, and Women entrepreneurs that are headquartered in Minnesota or willing to relocate to the state. The MSP Equity Fund will also provide a direct-investment option and an accelerator that allows more direct alignment of strategic investment goals with the overriding investment themes of the fund.
“The MSP Equity Fund is an engine for growth and innovation for our region’s economy,” said Peter Frosch, President and Chief Executive Officer of the GREATER MSP Partnership. “We are encouraged to see so much support for this strategically important investment that improves access to capital for under-represented founders and entrepreneurs.”
Lead investors include Allianz Life, Allina Health, Xcel Energy, and Abōva. The fund is managed by gener8tor partner Al Cornish.
“The first close of the MSP Equity Fund demonstrates the strong momentum behind the fund and recognition of the value and importance of the fund’s thesis. But I want to stress that this is just the beginning – the first step in our strategy to partner with high-performing fund managers that see the tremendous business opportunity to invest in high-growth diverse-led startups, an often undervalued yet over performing asset class. Inclusion is the imperative in this next era of innovation. We believe the MSP Equity Fund will provide the necessary capital and support to sustain a growing, inclusive innovation economy in the state,” said Al Cornish.
“This first close is a great step for further driving inclusion and innovation among our startup community in the Twin Cities,” said Jasmine Jirele, President and CEO, Allianz Life. “Partnering with Al, gener8tor and Forge North on this important initiative will help build momentum as well as help further our mission – we secure your future – right here in our own community.
One of the key capital allocation strategies of the MSP Equity Fund will be investments into top diverse-asset-management firms both locally and nationally. Research has shown that diverse-fund managers often outperform their non-diverse peers. Further, it has been demonstrated that asset management firms that are owned by BIPOC and/or Women managers are at least three times more likely to have diverse investment staff compared with firms that have non-diverse ownership.
Additionally, the investment thesis of the MSP Equity Fund revolves around seizing the missed opportunity to invest in high-growth, leading Black-, Brown- and Women-led startups, which have the potential to create lasting economic value and an outsized impact on the community. Companies with diverse founders ultimately outperform others by 30 percent when they go public or are acquired, according to an analysis of nearly two decades of data by the Kauffman Fellows Research Center. While diverse firms have less access to venture capital in early stages, they tend to raise more money in subsequent rounds, according to the report. According to Crunchbase data, in 2022 less than five percent of venture-capital dollars invested in Minnesota-based startups went to companies with Black, Brown and Women leadership.
The MSP Equity Fund aims to transform Minnesota into one of the top investment destinations for leading venture capital fund managers and also one of the top ecosystems for Black, Brown and Women entrepreneurs seeking to launch ventures at the leading edge of key industry sectors.
gener8tor’s turnkey platform for the creative economy connects startup founders, investors, corporations, universities, job seekers, musicians and artists. The gener8tor platform includes accelerators, upskilling, corporate programming, and conferences with content on community growth, impact investing, diversity, equity and inclusion, and innovation across education, agriculture, insurance, healthcare, and more. Recently, gener8tor was named one of Fast Company's Best Workplaces for Innovators. For more information, visit gener8tor.com.
About the GREATER MSP Partnership
Forge North is part of the GREATER MSP Partnership. It is a coalition of 100+ partners advancing the Minneapolis-Saint. Paul startup ecosystem. GREATER MSP is a partnership of more than 4,500 individuals from more than 300 leading businesses, universities, cities, counties and philanthropic organizations working together to accelerate the competitiveness and inclusive growth of the 15-county Minneapolis-Saint Paul regional economy.
Abōva, Inc. is a Minneapolis-based oral and overall health, technology and science driven company. Our focus is to accelerate oral health solutions that benefit overall health. e convene industry knowledge leaders and selectively provide capital to support leading technologies. Our goal is to assist companies with promising technologies to ultimately achieve their full potential.
About Allianz Life
Allianz Life is a Minnesota-based Insurance Company which provides annuities and life insurance products in the United States in all states except for New York. Allianz Life is an established industry leader in providing millions of Americans with retirement solutions. With consistently strong ratings, the company is part of Allianz SE, one of the largest financial services companies in the world.
Allina Health is a nonprofit health system that cares for individuals, families and communities throughout Minnesota and western Wisconsin. The company has 27,000 employees that serve the company at 12 hospital campuses, 65 primary care clinics, 14 urgent care clinics and 100+ specialty care sites.
About Xcel Energy
Xcel Energy provides the energy that powers millions of homes and businesses across eight Western and Midwestern states. Headquartered in Minneapolis, the company is an industry leader in responsibly reducing carbon emissions and producing and delivering clean energy solutions from a variety of renewable sources at competitive prices.
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