Best Buy is investing $10 million in a Twin Cities-based fund with a mission to back entrepreneurs of color who have traditionally not been as likely to receive venture capital.
The sizable commitment from the Richfield-based electronics chain is the largest so far for Brown Venture Group, which says it's now 75% of the way to its goal of raising $50 million for its inaugural fund.
"We've got amazing founders and amazing entrepreneurs all over the metro area and all over the nation," said Chris Brooks, a co-founder of Brown Venture Group. "We just need the capital to get their ideas off the ground. So the Best Buy investment is a critical part of making that happen."
Brooks and Paul Campbell started Brown Venture Group in 2018 to try to fill a void in the venture capital world in which a small percentage of funding goes to startups led by people of color.
In addition, realizing that many entrepreneurs of color don't have the financial resources to raise a so-called friends-and-family round of funding, they are aiming to help fill in that gap by providing pre-seed funding to early-stage companies.
Campbell said they're hoping to have the fund fully subscribed by the end of the year. They have five companies in their current portfolio and are in talks with several more startups.
For Best Buy, this investment is its latest initiative in the area of racial equity. Last year, it pledged that 30% of the 1,000 new hires it planned to make in technology would be women or people of color.
And in June, it announced it will spend at least $1.2 billion with businesses owned by people of color by 2025. The $10 million investment in Brown Venture Group is on top of that commitment.
"We're committed to taking meaningful action to address the challenges faced by BIPOC entrepreneurs," Best Buy CEO Corie Barry said in a statement. "Through partnerships like this, we believe we can begin to do this by helping to build a stronger, more vibrant community of diverse innovators in the tech industry, some of whom we hope will become partners of Best Buy in the future."
Brown Venture Group will also work with Best Buy to launch an entrepreneurship program at some of the retailer's teen tech centers.