General Mills is investing $15 million in two venture-capital funds aimed at boosting financial backing for women and people of color in the food business.
A small percentage of venture-capital funding goes to companies with founders who are female, especially women of color. With that disparity in mind, the Golden Valley-based company's own venture-capital arm, 301 Inc., announced the investment in Fearless Fund and Supply Change Capital on Wednesday.
"We experience firsthand the expertise and passion of the diverse and female founders within our 301 Inc. portfolio, and yet there is a systemic gap for minority food entrepreneurs looking for early-stage venture-capital funding," Doug Martin, General Mills' chief brand and disruptive growth officer, said in a news release.
Just 2% of venture-capital funding last year went to companies founded by women, according to PitchBook. A Harvard study found "women make up approximately 11% of investing partners at VC firms, and only around 13% of venture-capital dollars go to startups with a woman on the founding team."
A Crunchbase report found 2.4% of venture-capital funds went to Black and Latino founders between 2015 and 2020.
"Venture capitalists play a critical gatekeeping role in deciding whose ideas, products and innovations get a chance to shape our modern economy and society," the Harvard report said.
Johnny Tran, senior business development manager at 301 Inc., said it was important to invest in venture funds rather than directly in startups to have the biggest impact.
"Our expertise in scaling businesses is often not the perfect fit for early-stage founders who are still validating concepts and laying their foundations," Tran said. "By creating an ecosystem of complementary partners, like these two funds, we can start to close that opportunity gap, reach a wider network of entrepreneurs across geographies and build deeper connections than we could on our own."
