New Community Transformation Fund (NCTF), a Grand Rapids-based venture fund aimed at boosting businesses owned by people of color in West Michigan, announces it has received a $1m investment from the Wege Foundation, marking the first from a private foundation. With the investment, NCTF has $9.75m, putting it just $250,000 shy of its $10m goal – the amount of capital raise necessary for the fund to make its first investments in businesses owned by people of color.
The Wege Foundation, founded in 1967 by Peter Melvin Wege, son of Steelcase co-founder Peter Martin Wege, has a mission of “Planting seeds that develop leaders in economicology, health, education, and arts, and enhance the lives of people in West Michigan and around the world.”
NCTF leaders are confident that the investment by Wege will trigger additional private foundation involvement in the nearly two-year-old fund.
“Thank you to the Wege Foundation, for their continual commitment to diversity and change in our community,” said OIlie Howie, managing director, NCTF. “We are excited to have them onboard and look forward to a long relationship together since our missions are so aligned. We hope that Wege is the first of many mission-driven foundations that will be a part of our inaugural limited partner list. We are grateful that Wege is helping us reach our goal of improving our community by investing in the best diverse led companies.”
Inspired by an idea in 2018 by former longtime Right Place president and CEO Birgit Klohs, who serves as a board member, NCTF publicly launched Jan. 23, 2020.
It was the idea of creating opportunity for entrepreneurs of color that led Klohs to share the idea in 2018 with longtime friend Skot Welch, founder of Global Bridgebuilders, an internationally known diversity, equity, and inclusion consulting firm. Welch then recruited successful venture capitalist Kwame Anku, CEO and General Partner of Black Star Fund, who is widely known as one of the first Black venture capitalists to create a fund with an all-Black portfolio. Anku stepped in to serve as a fund consultant during the first year of operations. The trio, who are all NCTF board members, incubated the idea and socialized it with potential funders. It quickly became clear that the idea was widely supported.
NCTF intends to invest between $250,000 to $500,000 in second-stage, people of color-owned companies involved inadvanced manufacturing, food and agribusiness, e-commerce and information technology, life sciences, and finance technology as well as legacy and transitioning succession businesses. With this Wege commitment, the fund is targeting the first quarter of 2022 to make its first investment.
The fund will focus on three areas: West Michigan-based, people of color-owned companies; transitioning, non-local companies that are willing to place an entrepreneur of color in executive positions and second-stage, entrepreneurs of color who will relocate to West Michigan to grow their company.
