Goldman Sachs Seeks to Help Black and LatinX Founders Accelerate their Growth
Goldman Sachs Group Inc. seeks to identify a group of innovative black and Latinx founders to help them position their ventures to become the next generation of game-changing businesses. The firm recently announced the extension of its Launch With GS initiative with the inaugural Black and Latinx Entrepreneurs Cohort, offering diverse founders unprecedented access to resources and relationship-building opportunities with investors and experts to accelerate the growth of their companies.
Started in 2018 based on the philosophy that diverse teams produce strong returns, Launch With GS represents the firm’s $500 million investment strategy to provide capital and connections for black, Latinx, women, and other diverse entrepreneurs. Such initiatives are necessary given the fact that black and Latinx founders receive less than 1% of venture financing, according to Goldman Sachs.
“There is a misallocation of capital going to businesses with diverse starting teams and for us, not only do we want to narrow those investment gaps but they also present an investment opportunity,” says Jemma Wolfe, head of Launch With GS, which has already invested $230 million since the initiative’s inception. “Another thing we’re doing is building out an ecosystem to support these businesses.”
So what will make the Black and Latinx Cohort so impactful? Founders of high-growth companies will participate in one-on-one business coaching sessions and sector-specific workshops with the firm’s leaders across investment banking, research, and investing teams. Moreover, program participants will be able to gain valuable legal, marketing, and branding advice from industry experts as well as be able to connect with the vast Goldman Sachs network.
”One of the things we have been excited about has been the response,” says Margaret Anadu, a partner and managing director and head of the Goldman Sachs Urban Investment Group. “The amount of feedback that we have received from other investors in the field, really strong entrepreneurs, and, more specifically, the applicants has been overwhelming. The initial step is having entrepreneurs in the Cohort make a connection with our firm so we can get to know them, understand their businesses, learn about the challenges, and then go from there and figure out how we can help them achieve the desired outcome.”
Anadu says the value of the program is the fact that it is customized to meet the specific needs of program participants. So if a cohort member needs capital, he or she can be directed to investors. Or if another company needs to expand its customer base, the founder can gain connections to one of Goldman Sach’s Fortune 500 clients.
Launch With GS has established the following criteria:
— Black or Latinx founders of a U.S.-based firms
—- The company must have $1 million or more in annual revenues
— The applicants must operate companies that are a part of the enterprise technology, financial technology, consumer, and healthcare sectors
—- Founders must offer a “big idea”
The culmination of the eight-week virtual program will be an Investor-only showcase in which cohort members can attract financiers to their companies.
Another asset to entrepreneurs participating in the program is gaining access to members of Launch With GS’ blue-chip Advisory Council.
Says council member Melissa Bradley of 1863 Ventures, a business development program for high-potential “New Majority” entrepreneurs: “Launch With GS Black and LatinX Cohort benefits from the integration into the firm as opposed to a semi-marginalized philanthropic CSR community initiative that sometimes ends up being temporal in nature. What I’ve seen, so far, is the commitment of the entire firm across different departments to not just service black and brown entrepreneurs but to integrate them into the Goldman Sachs family, giving them access to all products and services and not just those through this particular lens. That’s not the norm.”
Bradley, who will serve as one of the advisers, also appreciates “the collective framing” of a program that unifies black and Latinx entrepreneurs and content that focuses on short- and long-term objectives and community impact.
Another council member, Marlon Nichols, founding managing partner of VC firm MaC Venture Capital, says that the program is not an accelerator but a full-service platform to meet the specific business objectives of cohort participants. He believes the program, however, will help “level the playing field In the allocation of capital.” To achieve that end, Nichols believes the program can serve as a powerful platform to facilitate “more dollars flowing through diverse fund managers. That’s one sure-fire way to make sure that black and Latinx will gain the capital they need. That’s the area in which I will spend most of my time.”
Moreover, he says the programs will open doors for diverse founders in the cohort to forge business-enhancing partnerships.
Interested black and Latinx entrepreneurs should move quickly. Applications for the Launch With GS Entrepreneur Cohort are now open. To learn more visit: www.gs.com/black-latinx-entrepreneur-cohort. The application deadline is April 17.
Original Post: BlackEnterprise, 4/3/20