PayPal Holdings, Inc. (NASDAQ: PYPL) announced it will invest $50 million in eight early-stage, Black and Latinx-led venture capital funds: Chingona Ventures; Fearless Fund; Harlem Capital; Precursor Ventures; Slauson & Co.; VamosVentures; Zeal Capital Partners; and one additional fund. The investments are part of PayPal’s commitment to invest $530 million to support Black-owned businesses, strengthen underrepresented minority communities and fight for racial equity and economic equality.
“Black and Latinx founders have been underrepresented in venture capital funding for far too long,” said Dan Schulman, president and CEO, PayPal. “By directing our dollars to investors from underrepresented communities, we’re supporting their investment in Black and Latinx entrepreneurs at the earliest stages. We’re honored to support this outstanding group of venture capitalists as we seek to bring more equity to the fundraising process.”
PayPal will work collaboratively with these early-stage funds and, in some cases, invest directly in businesses through PayPal Ventures, its venture capital arm. PayPal Ventures invests in series A through later funding rounds of startups in areas of strategic relevance to PayPal, including financial services, commerce enablement and payments infrastructure. PayPal will also begin offering a three-month fellowship to a Black or Latinx graduate student each semester, through which the PayPal Ventures team will provide coaching, training and mentoring.
“PayPal recognizes that our lived experience allows us to deeply empathize with the journey of other women of color entrepreneurs,” said Arian Simone, founding partner of Fearless Fund. “Women of color should be able to pitch to people who look like them on the other side of the table. We’re excited to begin this relationship with PayPal.”
“I believe this initiative from PayPal will have real impact on the demographics of founders that receive funding at the seed-stage,” said Charles Hudson, founding partner of Precursor Ventures. “Not only that, but the PayPal team can bring unique counsel and expertise to these companies as they grow.”
“We’re proud to welcome PayPal as an inaugural investor in our new fund,” said Austin Clements, founding partner of Slauson & Co. “Through our investments, we hope to be a catalyst for positive change for people who face historic disparities in access to capital and opportunity.”
“Not only is it undeniable that there is a pipeline of extraordinary diverse tech visionaries who are being overlooked, it is also imperative to the country to fully utilize and incorporate their ideas, talent and gumption,” said Marcos C. Gonzalez, founding partner of VamosVentures. “PayPal’s investment, alongside those from our other limited partners, will help us support this group and improve the landscape for everyone.”
“Now more than ever, it’s abundantly clear that we need more businesses delivering solutions to bridge the wealth and skills gap at scale,” said Nasir Qadree, founder and managing partner of Zeal Capital Partners. “We’re thrilled to have PayPal recognize that our Inclusive Investing™ strategy positions us to source, invest and scale high growth early-stage businesses across the U.S. and beyond the major finance and technology hubs.”
In September, PayPal awarded approximately $5 million in grants to 20 nonprofit community partners to support Black-owned businesses across the U.S. in their recovery from the impact of the COVID-19 pandemic. In August, PayPal completed the distribution of $10 million in empowerment grants to Black-owned small businesses to help them stabilize and reopen during the pandemic. The company also announced a $50 million deposit in Optus Bank, a Black-owned bank based in South Carolina dedicated to providing equal access to capital and financial services for minority communities, as part of an initiative to make deposits in Black- and minority-owned financial institutions.