False Dichotomy: Introducing AVG’s New Anti-Bias Fund
December 23, 2020 | Ashley Brindamour
The AVG Anti-Bias Fund offers investors a portfolio of ~20-30 venture investments that are led by diverse founders/teams or featuring a business model addressing systemic biases.
AVG creates the portfolio from deals invested in by actively managed AVG funds. We then vet them for their fit with the Anti-Bias Fund thesis. The portfolio will be largely built over ~12-18 months, with ~20% set aside for follow-ons. The minimum starts at $25K. The fund closes at the end of March.
New Anti-Bias Fund Open
The Anti-Bias Fund offers investors a portfolio of about 20-30 venture investments that are led by diverse founders/teams belonging or featuring a business model addressing systemic biases. Click below to review fund materials, along with case studies on AVG portfolio companies that demonstrate the kind of investment we might add to the Anti-Bias Fund. You can also book a call with a Senior Partner if you have questions or want to learn more.
To introduce AVG’s new Anti-Bias Fund and explain what’s different about it, we sat down with Mike Collin, CEO of Alumni Ventures Group.
Mike, please briefly explain what the Anti-Bias Fund is and what it offers investors?
The Anti-Bias Fund will invest in ~20-30 venture-backed companies that feature diverse founding teams or business models addressing biases. We vet every deal to first ensure it meets our standards as a promising venture deal, then we vet it to see if it meets our fund thesis. The fund is targeted at investors who like the potential for profit and the ABF thesis — a chance to do good AND do well.
Can you unpack “false dichotomy” and why this presents an opportunity for investors?
It’s patently false to say that you can either make money OR be an impact investor. AVG has invested in many companies doing both. Venture is by definition about backing innovative companies addressing unmet opportunities or addressing problems — especially for underserved groups. Note those words — it also happens to define (among others) African-Americans, women, Latinx, etc. These startup innovators are backed by profit-minded VCs who believe the companies stand a chance of delivering a good return.
For us, the ABF profit motive works even for those indifferent to impact investing. We apply rigorous evaluation standards to try to identify those venture deals most likely to deliver a profit for investors by delivering on the promise to represent and/or address underserved groups.
Why did AVG want to offer this fund?
I acknowledge that we’ve been inspired by the new determination in society to address inequality. But this is also a longstanding commitment of AVG’s — and a priority for many of our investors and teammates. We want to foster greater equality in society, but more particularly, focus on where we can feel AVG is well-suited to make the greatest difference: by funding difference-making teams and companies.
Fund Intro Webinar
Join our webinar, An Introduction to AVG’s Anti-Bias Fund, on Tuesday, January 12, at 2:00 PM EST. We’ll explain the investing thesis behind this fund, outline our process for assembling the portfolio, give examples of representative deals, and answer questions.
How will AVG source and evaluate deals for the Anti-Bias Fund?
Deals are sourced by AVG’s 17 actively managed funds and must first clear our process as a promising venture investment, without any other lens, before being eligible for the Anti-Bias Fund.
- Deals are sourced through our full-time investment team of almost 50, plus our 550,000 member community of alumni, subscribers, and venture connections.
- Our due diligence process involves market research, review of the company’s materials, conversations with VCs and experts, and our own analysis.
- In terms of scoring, the fund team, their Investment Committee, and AVG’s Investment Committee must all pass the deal.
- ABF will have a deep slate to choose from, as AVG funds invest in about 200 deals per year.
Once an AVG sponsor fund has approved and committed to a deal,
- They nominate appropriate candidates for the Anti-Bias Fund. Our 7-member Focused Fund Committee (majority of members diverse) makes the final determination on whether the opportunity is a fit.
- They also look at portfolio diversity. Will this particular deal contribute to diversification across stage, sector, geography, and lead investor?
Anything else that investors should know about?
We’ve been casually socializing this fund with investors for the last quarter and are seeing strong enthusiasm. The minimum investment of $25K is a fairly low barrier to entry, and folks really seem to like our approach. It’s authentic, disciplined, and sustainable.
About Mike Collins
Mike Collins, CEO of Alumni Ventures Group, has been involved in almost every facet of venturing, from angel investing to venture capital, new business and product launches, and innovation consulting. He launched AVG’s first alumni fund, Green D Ventures, where he oversaw the portfolio as Managing Partner and is now Managing Partner Emeritus. Mike is a serial entrepreneur who has started multiple companies, including Kid Galaxy, Big Idea Group (partially owned by WPP), and RDM. He began his career at VC firm TA Associates firm. He holds an undergraduate degree in Engineering Science from Dartmouth and an MBA from Harvard Business School.