Corigin Ventures (now Alpaca VC) Commits $2.5 Million to Diverse GPs
Unless you’re living under a rock, it’s impossible to unsee the social unrest and power of collective protesting that has overtaken the country these last few weeks. Systematic racism has existed for centuries, but this is an inflection point for us as individuals and society. At Corigin, we value the notion that diverse, representative and extremely talented founders and investors can create the future we want to live in. How many studies does McKinsey need to publish to prove that diverse voices lead to better collective outcomes? We at Corigin also value transparency, believing that it is the quickest path to iterative success and encourages others to speak their truths. Lastly, we value grit and doing things the hard way, even if that takes longer.
We also believe that actions speak louder than words. Today, we want to move beyond offering an open dialogue or office hours and push towards long-standing impact. As the twitterverse has loudly screamed, hire or wire. Below we are outlining our commitments and plans as they stand today (these do include hiring and wiring, for the record). We are excited about marching ahead, but admit that enacting this plan will take a lot more listening, and so we want to hear from the community — those who we know and do not — about how we can continue to push the venture ecosystem into the twenty-first century.
Step 1. Commit dollars to Black & Latino/Latina GPs
In the immediate term, we want to commit to swift action where our internal hiring path will hopefully follow. We believe that backing Black and Latino/Latina check writers in the industry will lead to more and better deal flow, from more diverse founder networks. As such, we are very excited to announce that, over the next 12 months, Corigin may write three to five commitments between $500K and $1M of independent GP capital to Black and Latino/Latina investing partners (independent to the fund). We will invest directly into their funds as LPs and hope to create immense synergy in doing so.
Diverse GPs can provide us access to secondary networks far better than we can ourselves today. We also believe that we can help these select GPs beyond just providing them money. We can give access to follow-on capital for their portfolio; we can introduce them to LPs and other funding sources; and we can help them (especially first-time managers) institutionalize their fund and processes.
So who are we looking for? Here is our criteria to invest:
- Majority Black and/or Latino/Latina owned GP, US based
- Pre-Seed and Seed focus
- Preferably Fund I or II
We will write 3–5 commitments, between $500K-$1M each. This ensures that we are ourselves peers or upstream capital for the GPs we commit to, so we can share in learnings and in dealflow. If you, or someone you know, is qualified, please email email@example.com directly.
Step 2. Benchmark our progress
It is important to acknowledge our own progress and where we can do better. Out of both funds (since 2013), we have invested in 38% companies with under-represented founders* and 7% people of color**. As of our last fund, we have invested in 48% companies with under-represented founders* and 8% people of color**. One of our best performing companies was founded by a Black founder, and we say this not to congratulate ourselves, but more to say that we want more operators of his caliber. The trendline is in the right direction, but we have more work to do.
Our stated goal:
Moving forward, we strive to maintain 50% under-represented founders in our portfolio. And we want at least 15% of our portfolio to represent Black or Latino/Latina founders.
*defined as female, LGBTQ+, Black, Latino/Latina, or Indigenous
** defined as Black, Latino/Latina, or Indigenous.
Step 3. Create better processes for dealflow
In achieving our goal of finding outstanding, diverse talent that can create outsized returns, we need to broaden our existing networks. We think there are a couple of ways we can do this, perhaps the greatest of which lie in Steps 1 and 4 below. Barring those more sweeping changes, we want to reiterate and commit to a couple quotidien tasks we hope everyone comes to understand about our firm.
We are not managing to warm intros.
Know that some 30% of deals we get sent are cold inbounds. We do not believe we need to know you (or we need to be six-degrees-of-separation away from Kevin Bacon) to invest in you. As GPs ourselves, we haven’t come from traditional business schools or backgrounds, so we understand the value of casting a wide net for talent. We all check our DMs regularly and actively check our general inbox: firstname.lastname@example.org
We want to broaden our networks.
We believe one solution is to build stronger relationships with educational institutions in NYC, where Black and Latino/Latina students organically create their own social networks. We want to know about other groups and avenues, though, so please do not be shy if you have ideas.
Step 4. Continue hiring diverse talent
Earlier this year, we hired Aubrie Pagano — a successful female founder — as Partner to attract a unique set of companies to our firm. Similarly, we want our next hire(s) to bring a differentiated network of founders into our world. A great way to do that is to hire a minority investor.
As we consider our next set of hires, our goal is to consider a diverse candidate pool of investment professionals. Given the current pipeline issue the industry faces we know that this is a hiring framework we need to cultivate starting now and in the years to come.
We hope that in exposing our own data and transparently talking about our goals to be better, we join the many others in the industry paving a new, more inclusive path forward. We have been dedicated to diversity as a firm, and so will put our money where our mouth is.
Aubrie Pagano, David Goldberg, Ryan Freedman
Disclaimer: this initiative represents entities related to Corigin Holdings and does not represent the activities of Alpaca VC or any of its clients or funds.