Japanese conglomerate SoftBank has recently announced the launch of its second fund under the Opportunity Growth Fund, now rebranded as the Open Opportunity Fund (OOF).
The fund aims to raise and invest $150 million in startups led by Black and Latine entrepreneurs.
New name, chairman, & access
Taking the reins as chairman of the fund is serial entrepreneur and investor Paul Judge, who previously served as a founding investment committee member. Alongside SoftBank and select affiliates, Judge and others have agreed to acquire an ownership stake in the OOF.
The rebranding of the fund as the Open Opportunity Fund signifies a more inclusive approach, now allowing external investors to participate. The fund’s primary objective is to deploy the newly raised $150 million within three years.
Judge told TechCruch that the fund’s rebranding signifies a more inclusive approach, as it now enables additional LPs and organizations to invest.
“The lack of funding for Black and Latino founders is still tens of billions away from parity; this is another step in making sure we bring more opportunity to those talented founders.”
Image credit: Paul Judge (Facebook)
Successful first fund
The inaugural fund was launched in June 2020 by SoftBank’s then-COO Marcelo Claure, along with Judge, managing partner Shu Nyatta, and TaskRabbit CEO Stacy Brown-Philpot.
It initially deployed $100 million across 75 companies, including notable startups like Greenwood, Career Karma, and Praxis Labs. Approximately half of Fund 1’s investments were directed toward early-stage companies, while the remaining funds were allocated to growth-stage companies.
Since its inception, the fund has celebrated seven successful exits and invested in five unicorns, including Cityblock Health and Brex.
Diverse portfolio and investors
Last year, the fund briefly operated as an “evergreen fund,” allowing for open-ended investments across different stages without constraints. However, with the transition to Fund 2, OOF adopts a traditional closed-ended structure. Notably, SoftBank’s other funds will continue to selectively invest within the OOF portfolio, solidifying their commitment to supporting diverse entrepreneurs.
Within the OOF portfolio, 61% of the companies are Black-owned, while 43% are Latine-founded. Some companies identify as Afro-Latine, so the total exceeding 100%. Additionally, women-founded companies, including non-Black and Latina women, comprise 12% of the portfolio.
Read: Mark Your Calendars: September 30 Is Now National Black Funding Day!
Combining investments from SoftBank’s Vision Fund 2, Latin America Fund, and the initial $100 million investment from OOF’s Fund 1, SoftBank’s total investment in Black and Latine-led businesses now amounts to $700 million.
“Scaling this is really about enabling more founders to solve problems,” Judge told TechCrunch. “In doing so, they make the world better; they build a company that’s valuable and deliver returns to investors. It creates an impact on many different levels.”
