Amazon to Invest $150M in VC Funds Backing Underrepresented Founders
Amazon.com announced Wednesday it would spend $150 million in venture capital funds on firms that are backing companies founded by underrepresented founders. The online retail giant dubbed the initiative "Amazon Catalytic Capital" and expects to support more than 10 funds and over 200 companies through the next year, it said in a press release. The company will invest in firms, accelerators, incubators, and venture studios that focus on Black, Latino, Indigenous, women, and LGBTQIA+ founders, primarily at the pre-seed/seed stage of venture capital funding. In addition to providing capital, the Amazon Catalytic Capital initiative will also offer mentorship and business opportunities to the funded startups.
Total Retail's Take: Amazon expects the initiative will lead to a financial return and new product development to benefit its customers, coupled with extra capital for those lacking access, Nick Komorous, vice president of corporate development, told Reuters. It would seem to be a win-win for all parties involved.
"There's a lot of data to support that these diverse groups and teams end up seeing more products reach market," Komorous told Reuters. At the same time, "investors are being more cautious with the economy in its current state, so the need's even more critical."