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Base10 Partners Joins Forces with Robert F. Smith's Student Freedom Initiative to Grow the Endowments of Historically Black Colleges and Universities (HBCUs)
June 14, 2022
The world's largest Black-led Venture Capital Fund partners with the founder of the world's largest Black-led private equity firm to address systemic inequalities in college endowments
- Base10 Partners, the world's largest Black-led venture capital fund, announced today that it has entered into a formal partnership with Student Freedom Initiative to expand the investment options available to Historically Black colleges and Universities that are members of the Students Freedom Initiative.
Building intergenerational wealth for the Black Community, this partnership will ensure that HBCUs have greater access to venture capital investing, without the traditional barriers to entry, including limited investment capital, smaller endowments, near term needs for capital to meet operational expenses, which have preclude them from investing in this asset class in the past. This partnership will eliminate these traditional barriers to entry with the following scalable solutions: (1) no minimum investments, (2) no management fees, (3) reduced holding period, and (4) sharing of profits with HBCUs. Expanding access to venture capital investments provides the opportunity for HBCUs to potentially increase their risk adjusted returns for their endowments which typically lag that of those colleges and universities which invest in in this particular asset class. These increased risk adjusted returns provide the resources to reduce the student loan debt burden and to increase the resources available to student services .
"This partnership is another example of what is possible when we are intentional and collaborative. By specifically addressing barriers (e.g., minimum investment, liquidity, expenses, and holding period) which have typically prevented HBCUs from gaining access to alternative investments, this solution will become an integral component in addressing the endowment wealth gap between HBCUs and their white counterparts," said Robert F. Smith, Chairman of the Student Freedom Initiative, as well as the Founder, Chairman, CEO, Vista Equity Partners. "We look forward to working with Base10 Partners and other strategic partners to assist HBCUs taking advantage of this opportunity, and we call on others to join us in increasing the competitiveness and resilience of all HBCUs using similar, scalable solutions."
This partnership builds on Base10's Advancement Initiative, which was designed specifically for HBCUs, provides these institutions with greater access to alternative investments by allowing them to invest in pre-IPO tech companies with shortened holding periods and time to liquidity without paying traditional fees or meeting investment minimums. Importantly, the Advancement Initiative donates 50% of carried interest to HBCUs to support student scholarships and university endowments.
"Thanks to the work of Robert and Vista Equity Partners, private equity has outpaced venture in terms of bolstering others and opening doors to those with underrepresented backgrounds," noted Adeyemi Ajao, co-founder and Managing Partner at Base10 Partners. "Through this partnership with the Student Freedom Initiative, we're leveraging the power of the two largest asset classes. It's particularly meaningful to be doing this as the largest firms led by Black managers in each. We're looking forward to working together to challenge existing systems and increase opportunity for HBCUs and their students in new ways."
- Alabama A&M University
- Benedict College
- Bennett College
- Bowie State University
- Claflin University
- Clark Atlanta University
- Dillard University
- Fisk University
- Florida A&M University
- Hampton University
- Interdenominational Theological Center
- Jackson State University
- Jarvis Christian College
- Lemoyne-Owen College
- Miles College
- Morehouse College
- Morris College
- Prairie View A&M University
- Shaw University
- Texas College
- Texas Southern University
- Tuskegee University
- University of the Virgin Islands
- Voorhees College
- Xavier University of Louisiana
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