Key Takeaways
- • Howard University announced it has joined the Advancement Initiative with Base10 Partners, the largest Black-led venture capital firm, as the anchor HBCU in a fund that invests in pre-IPO startups.
- • The fund will donate 50 percent of its carried interest directly to Howard and other Historically Black Colleges and Universities (HBCUs) to fund student scholarships and support endowments.
- • The Advancement Initiative has completed 8 investments in companies including Attentive, Nubank, Brex, Plaid, Aurora Solar, Wealthsimple, CircleCI, and KeepTruckin, according to the announcement.
- • The press release describes the LP base as HBCUs alongside other minority organizations and mission-driven foundations, calling it one of the largest commitments ever from HBCUs to a venture capital fund.
- • The announcement cites a GAO figure of $15,000 average endowment per student at HBCUs versus $410,000 at comparable non-HBCUs, highlighting the funding gap the initiative aims to address.
Summary
Howard University announced on May 27, 2021 that it has joined the Advancement Initiative with Base10 Partners, a San Francisco-based early-stage venture firm that the university describes as the largest Black-led venture capital firm. The fund invests in leading pre-IPO startups and directs 50 percent of its carried interest to Howard and other Historically Black Colleges and Universities (HBCUs), with the proceeds intended for student scholarships and university endowments. The limited partner base consists of HBCUs, with participation from other minority organizations and mission-driven foundations. The university characterized the commitment as one of the largest ever made by HBCUs to a venture capital fund.
Howard Chief Investment Officer Frank Bello said the initiative gives HBCUs a mechanism to grow endowments and provide graduates with previously inaccessible post-graduation opportunities, and that the partnership aims to increase HBCU impact through wealth creation and greater diversity in the technology industry. Base10 co-founder and Managing Partner Ade Ajao said supporting HBCUs is the most effective way for the firm to increase underrepresented minority talent in Silicon Valley.
The announcement frames the initiative against a structural funding gap. Per the U.S. Government Accountability Office, HBCUs have an average of $15,000 in endowment per student, compared with $410,000 at comparable non-HBCUs. The university also said all 107 HBCU endowments combined equal roughly 7 percent of Stanford University's endowment, while HBCUs confer nearly half of all STEM degrees earned by African-American students. Historically, HBCUs have lacked the resources or relationships to invest directly in early-stage technology companies.
Despite debuting in March 2021, the Advancement Initiative has completed eight investments in Attentive, Nubank, Brex, Plaid, Aurora Solar, Wealthsimple, CircleCI, and KeepTruckin. According to the announcement, each portfolio company CEO prioritized taking the investment in heavily oversubscribed rounds. Base10 plans to create scholarships named for each portfolio company, such as The Plaid Scholarship and The Brex Scholarship, to fund HBCU STEM students. Base10 Partner Jamison Hill, who leads the initiative, tied the effort to his own family's experience at North Carolina A&T.
Howard Chief Investment Officer Frank Bello said the initiative gives HBCUs a mechanism to grow endowments and provide graduates with previously inaccessible post-graduation opportunities, and that the partnership aims to increase HBCU impact through wealth creation and greater diversity in the technology industry. Base10 co-founder and Managing Partner Ade Ajao said supporting HBCUs is the most effective way for the firm to increase underrepresented minority talent in Silicon Valley.
The announcement frames the initiative against a structural funding gap. Per the U.S. Government Accountability Office, HBCUs have an average of $15,000 in endowment per student, compared with $410,000 at comparable non-HBCUs. The university also said all 107 HBCU endowments combined equal roughly 7 percent of Stanford University's endowment, while HBCUs confer nearly half of all STEM degrees earned by African-American students. Historically, HBCUs have lacked the resources or relationships to invest directly in early-stage technology companies.
Despite debuting in March 2021, the Advancement Initiative has completed eight investments in Attentive, Nubank, Brex, Plaid, Aurora Solar, Wealthsimple, CircleCI, and KeepTruckin. According to the announcement, each portfolio company CEO prioritized taking the investment in heavily oversubscribed rounds. Base10 plans to create scholarships named for each portfolio company, such as The Plaid Scholarship and The Brex Scholarship, to fund HBCU STEM students. Base10 Partner Jamison Hill, who leads the initiative, tied the effort to his own family's experience at North Carolina A&T.
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