Rethink Impact, the largest impact venture firm in the
U.S. dedicated to investing in female tech entrepreneurs,
announced today the closing of a new $182M Fund II, bringing its
total AUM to nearly $300M. Since launching in 2016, Rethink
Impact has backed over 25 companies focusing on gender diverse
teams helping to solve the world’s greatest challenges. With this
new Fund, the firm will provide additional access to funding with a
continued focus on the leaders who need it most.
Rethink Impact’s backers are among the most diverse in the
venture industry. The Fund’s investor base is 65% female, hails
from nearly 40 states, and includes Pivotal Ventures, the
investment company founded by Melinda Gates, the Ford Foundation,
the W.K. Kellogg Foundation, university endowments, and significant
financial institutions such as UBS.
“An unfortunate side effect of the COVID-19 pandemic has been
the decline of diversity efforts in the venture industry,” said
Jenny Abramson, Founder & Managing Partner at Rethink Impact.
“Q1 2020 saw a 40% year-over-year decrease in the percentage of
female-led, VC-funded deals (PitchBook). While admittedly, it’s
hard to break into networks that make up the venture landscape
during this quarantine environment, the result is that female
founders are being left out at a time when their ideas are needed
most. We believe there is tremendous opportunity to use private
sector tools to drive positive, inclusive change and now is the
time to address these market blind spots and double down, not lean
out.”
Despite a significant increase in gender lens and impact
investing, the venture capital industry still does not come close
to mirroring the world around it, with just 2.7% of venture dollars
going to female founders in 2019 (PitchBook) and only .06% of
venture dollars going to black female-led startups (Project Diane).
This is despite the research that shows that female and diverse
founders drive more revenue per dollar invested (BCG, IFC, and
McKinsey) and female founders achieve faster exits than their peers
(PitchBook).
“There is much to be done, and the investment community – and
society as a whole – are missing out by not incorporating broader
points of view into which ideas get funded, which problems get
solved, and which communities benefit (or don’t),” said Heidi
Patel, Managing Partner at Rethink Impact. “Rethink Impact has
placed a real stake in the ground by investing institutional-scale
capital into primarily Series A- and B-stage companies led by
women. Beyond the diversity of our leadership teams, our portfolio
companies are also addressing major market gaps by bringing
innovative solutions and improving affordability in the healthcare,
education, sustainability and financial services sectors.”
Rethink Impact has backed companies such as Rachel Carlson’s
Guild Education, the first female-led impact unicorn that achieved
a $1BN valuation by helping upskill frontline workers (Forbes),
Sallie Krawcheck’s Ellevest, an investment platform for women that
has built the largest social media following of any financial
services company in the country (Inc.) and Helen Adeosun’s
CareAcademy, which just closed an oversubscribed Series A round to
help onboard and train 1 million home healthcare workers over the
next few years, improving quality and efficiency in the $103BN U.S.
homecare industry (Business Insider).
Quotes about Rethink Impact’s $182M Fund II:
“When we look at the data, we know companies
that embrace diversity are more creative and more profitable. Yet,
the tech industry does not at all reflect the diverse communities
we live in. This has to change,” Melinda Gates, Founder of
Pivotal Ventures, said. “If we want to expand women’s power and
influence in tech, one of the best actions we can take is invest in
female entrepreneurs, which is why organizations like Rethink
Impact are so critical. Ultimately, creating a more inclusive tech
industry will not only lead to more innovation, but a society that
benefits everyone.”
“We are thrilled to partner with Rethink
Impact in supporting women-led impact entrepreneurs,” said Roy
Swan, Director of Mission Investments at the Ford Foundation.
“For too long, female entrepreneurs have been overlooked by
traditional venture capital firms, starving the world of the
innovation that comes from their diversity of thought. Equitable
access to capital is an essential building block to an inclusive
economy and a just society. Rethink Impact’s focus on high-impact
female entrepreneurs brings us one step closer to that goal.”
"We are delighted to build on our existing
investment in Jenny, Heidi, and their team,” said Andrew Lee,
Head of Sustainable and Impact Investing at UBS Global Wealth
Management. “For any company, diversity in leadership and
employees is critical to diversity of thinking and ultimately
business success and sustainability. We and our clients are pleased
to support diversity-focused investments that address pressing
societal challenges."
“While it is shocking how little has changed in terms of capital
allocation since my own mother started one of the first funds
investing in women more than 20 years ago (Washington Post),” said
Abramson, “given the significant financial data supporting the
value of inclusive investing and the opportunity that this moment
in our history provides, our team couldn’t be more grateful to
accelerate this work.”
“We are humbled by the incredible work of our portfolio
executives and the innovations they are scaling in the market,”
said Patel. “If recent months have demonstrated anything, it is
that backing diverse leaders and their approaches to tackling our
biggest social and environmental challenges is more critical now
than ever.”
About Rethink Impact:
Rethink Impact is the largest impact venture firm in the country
dedicated to investing in female leaders using technology to help
solve the world’s biggest problems (Forbes) and believes the next
generation of extraordinary companies will find success through
their relentless pursuit of mission for the benefit of all
communities. Follow Rethink Impact on Twitter @RethinkImpact.
Jenny Abramson, Founder and Managing Partner
(@abramsonjenny), is a tech CEO turned venture capitalist. She is a
proven executive and entrepreneur having held a range of leadership
roles across the tech and impact space–in education, personal data,
and media. She has been covered in Forbes, in The New York Times,
and in The Washington Post, featured at SXSW, at the United
Nations, at a G7 event, and on Capitol Hill, and was named one of
Entrepreneur’s 100 Powerful Women and a DC Tech Titan. She received
a BA and an MA from Stanford University, an MBA and the Dean’s
Award from Harvard Business School and was a Fulbright Scholar at
The London School of Economics.
Heidi Patel, Managing Partner (@HeidiPatelSF), is a
seasoned venture investor and former President of New Island
Capital, an institutional-scale, impact investment advisor to a
single ultra-high net worth individual, Director at Pacific
Community Ventures, an impact-focused private equity firm, founding
member of AOL Time Warner Ventures, with additional experience in
investment banking. She also worked with D.light Design as an
Acumen Fund Fellow based in India. She has been covered in Forbes,
NPR’s Market Place, Project Entrepreneur, and TechCrunch and was
named a Wall Street Journal “Woman to Watch” in venture capital in
2018. Heidi earned an AB from Princeton and an MBA from the
Graduate School of Business at Stanford University, where she
co-teaches (and co-created) the course on impact investing.
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Chelsea Morris, chelsea@rethinkimpact.com