Japanese tech giant SoftBank Group said Thursday it was setting up a US$100-million fund for black entrepreneurs, the latest firm aiming to burnish diversity credentials amid US protests over racial injustice.
The Opportunity Growth Fund “will only invest in companies led by founders and entrepreneurs of color,” said the firm’s executive vice-president Marcelo Claure in an internal letter obtained by AFP.
Venture capital startups are “overwhelmingly white, male and Ivy-league educated and based in Silicon Valley. Just 1% of VC-backed founders are black,” he added.
Originally set up as a telecoms company, SoftBank Group has become an investment and tech behemoth with stakes in some of Silicon Valley’s hottest start-ups through its $100-billion Vision Fund.
But it has struggled recently and last month reported record losses caused by its investment in troubled office-sharing startup WeWork and depreciation in many other assets.
Adding to Softbank Group’s woes, Chinese tycoon and Alibaba co-founder Jack Ma will also be resigning as a director of the board this month.
With mass protests raging on US streets after the police killing of unarmed black man George Floyd, corporate bosses are under pressure to do more than simply speak out against racism.
Many major US corporations have issued statements decrying discrimination and some, including Apple and Bank of America, have put some money behind the effort by supporting civil rights advocacy groups or programs targeting disadvantaged populations.
“When it comes to diversity, SoftBank absolutely has to do better as an employer, investor and partner,” admitted Claure, who sits on a board made up of 11 men and no women.