When Humza Mirza goes to class in the spring, he won’t just be taking a class on venture capital investing. The second-year Emory University graduate student will be leading a $1 million fund.
He and four other students are managing partners in the Peachtree Minority Venture Fund for underrepresented entrepreneurs.
The fund aims to give Emory students investor experience while helping underrepresented entrepreneurs with their biggest hurtle — access to capital.
Willie Sullivan, one of the founding partners of the fund, heard from local founders, investors and mentors that capital was the main issue for women and entrepreneurs of color. He didn’t find any other student-led fund focusing on this demographic while researching the fund.
Emory University is the sole investor in the Peachtree Minority Venture Fund. The goal for students is to invest $100,000 of the fund per year, including in follow-on investments or first-time checks for entrepreneurs. The fund’s return on investment should replenish the capital, Sullivan said, and it is industry agnostic and not focused on Atlanta.
For now, the student team is looking for more classmates to join the fund. The class is set up like a traditional venture capital firm with managing partners, senior associates and analysts. About 20 students will participate per semester, Sullivan said. In addition to technical and financial lessons, the class will also cover the history of minority entrepreneurs, Sullivan said.
Students are also using this time to embed themselves into the Atlanta technology ecosystem to help source deals for next semester.
Mirza is antsy to get started. He hopes to start his own company someday, and he knows experience in venture capital will help that process. But the fund is also an opportunity to see a new perspective.
“There’s an initial barrier to capital for minority entrepreneurs with the friends and family round,” Mirza said. “That hit me hard. I have to acknowledge my privilege because I come from a family of physicians. Getting that first round of funding wouldn’t be an issue for me.”
Emory joins a host of other universities and venture capital firms that see value in allowing students to write checks. The University of Georgia launched the Georgia Kickstart Fund a few years ago and has distributed more than $70,000 since its launch.
The University Growth Fund, sponsored by financial technology company Ally Financial Inc., recently expanded to Atlanta to allow local university students to invest in technology companies. Located downtown, the fund specifically wanted to tap into the talent at the Atlanta University Center and Georgia State University to give more students of color opportunities in the world of venture capital.
The fund also adds to Atlanta’s growing number of resources for underrepresented founders, which includes investment firms, incubators and other organizations that provide mentorship and capital.
Sullivan already feels the pressure from Emory’s fund. He doesn’t want people to see the fund as a social justice project, and he knows people will be following if the fund succeeds.
“There’s an actual business case to fund diverse entrepreneurs,” Sullivan said.
Source: Atlanta Inno – Emory University to launch $1M student-led fund for diverse founders
