Mainframe organizer plans $10M venture capital fund for early-stage black tech entrepreneurs

A leader in Tampa Bay’s black tech community is in the preliminary stages of organizing a $10 million venture capital fund to support black entrepreneurs with early-stage tech companies.

It would be the first dedicated VC fund for black tech entrepreneurs in Florida, and one of 30 nationwide, said James Faison, an insurance industry professional and organizer of The Mainframe. The Mainframe is a Tampa Bay-based initiative to support the growth of black technologists, professionals, innovators and entrepreneurs throughout Florida.

“There are a lot of great things happening in Tampa that the rest of the country doesn’t know about,” Faison said. “I want to make Tampa the epicenter for black tech talent.”

Historically, black founders and other under-represented entrepreneurs have struggled to get venture capital backing, according to Tech Crunch, which reported in September that Base10 Partners raised a $137 million fund and was the largest debut to date for a black-led venture capital firm.

Florida is the third-largest state by population and 17th largest economy in the world, with recent numbers GDP numbers hitting $1 trillion, Faison said. “Yet there’s still a huge economic opportunity that we’re not capitalizing on by not having an established black tech hub and ecosystem.”

Faison said he is in the early stages of forming the fund now. He has some preliminary commitments and is building out a team of advisors with direct ties to the venture capital space, but he’s not identifying them until the official launch of the fund, likely next year.

He also expects to announce the name of the fund during The Mainframe’s next meeting in the first quarter of 2019.

Here are excerpts from the conversation between the St. Pete Catalyst and Faison about the new fund.

Why raise a fund?

I came into this with the goal of wanting to create jobs and opportunities as we move into this tech-centric future … and to build the foundation to open doors for a new class of generational wealth. I felt the best way to do so was to address the long-standing sticking points that most often hinder individuals in my community from turning their ideas from a thought to reality.

So over the next 5 years I’m going to activate 1,000 ideas from a class of people that in most cases, no one has paid attention to in the venture capital and startup community. To do that, I’m raising a fund.

I’m also going to continue building a brand for The Mainframe, one that generates a buzz and warms up the region to what’s happening here in Tampa, with the aim to incubate and grow those ideas into revenue-generating products and services.

Who’s on the team?

I have an amazing team of advisors that provide a wealth of knowledge in the VC and entrepreneurial community. As both the fund and The Mainframe initiative continue to grow, I will look for people that are smarter than me, better than me, and most importantly just as committed as me.

Are you planning to limit the fund to accredited investors or will you have non-accredited investors? [NOTE: An accredited investor is financially sophisticated, has $1 million in net worth and can deal with securities not registered with financial authorities]

Both. Just as there’s untapped innovative talent here, there’s also an untapped pool of investors that have no idea about the benefits and possibilities of investing in the startup community.

Who are the investment targets? 

The fund will invest in the earliest stages (often the first check) in roughly 30+ companies, whether you refer to it as true seed, pre-seed, early stage or anything else. Eighty percent to 90 percent will be deployed right here in the Bay area. The rest will be dedicated to founders around the region and other geo locations. I want to do more to put more founders in business.

Who are you looking for?

I’m looking for a wealth of founders, and their ideas. I want to be able to learn from as wide of a group as possible. So that for fund No. 2, I can be much more explicit about categories and expectations.

What about The Mainframe?

The Mainframe initiative will continue to play a critical role in reshaping and impacting the overall conversation around venture capital and black tech in general. The mission of educating, connecting and inspiring the entrepreneurial and innovative mind still remains intact. In our latest event held at Microsoft, we announced the 2019 rollout of The Mainframe’s virtual hub. This will aid in extending our reach to founders and technologists, regardless of geographical location.