The venture firm was founded in 2019 with a mission of investing in Black-led companies. In 2021, Burks Solomon and her fellow co-founders closed an initial $51 million fund and subsequently invested in 38 early-stage companies, including Hairbrella and Goodr. The average check size was just under $1 million.
With this $75 million fund, Burks Solomon said they plan to invest an average of $1 million to $2 million in approximately 30 companies, with a portion of the fund reserved for follow-on investment for the top performing portfolio companies.
It took about 18 months for Collab to raise its first fund, but this second tranche of investment took a little longer, from August 2023 to the beginning of this year. The fundraising also happened during a “totally different climate,” Burks Solomon said.
Some potential investors who were ready to sign checks changed their minds during the process because of some of the challenges to diversity, equity and inclusion and the increased uncertainty under the Trump administration, which has taken aim at diversity initiatives through executive orders, administrative actions and in court.
But it’s not just the increased attacks against initiatives perceived as being DEI-focused that made this fund more difficult to raise, Burks Solomon said, noting that economic factors like increased interest rates and less liquidity in the market because of fewer companies going public also made things harder.
The number of tech companies that have gone public in the last few years peaked at 126 in 2021, but has since dropped precipitously, according to venture firm Redpoint. In 2024, only nine tech companies went public. Mergers and acquisitions have also slowed in recent years, though there was a slight uptick in 2024, Redpoint wrote.
“I think that it’s a hard fundraising time for everyone. I have a lot of friends and fellow managing partners of funds who have experienced difficulties regardless of their background or who they’re investing in or what they’re investing in,” Burks Solomon said.
“But I would say that the shift in sentiments around diversity and inclusion has certainly not made our process any smoother or easier,” she added.
Credit: Handout
Credit: Handout
Since the Supreme Court decision in 2023 banning affirmative action in college admissions, conservative activists filed a spate of lawsuits across the U.S. targeting corporate DEI initiatives, chilling some organizations’ work and pushing others to adjust their language to avoid the same scrutiny. Burks Solomon said similar conversations happened at Collab.
“It’s really important to us to be able to stay in business and continue to do the work and, you know, to the extent that we need to think deeply about how we talk about that work, we definitely had to have those conversations,” she explained.
Collab has since shifted its language from exclusively investing in Black-led companies, but Burks Solomon said the firm is proud to still continue its mission of “making sure that capital is going to places that historically it has not gone and into solutions that are going to increase prosperity for everyone.”
“As gaps continue to widen and we see the continued consolidation of power,” she said, “it’s even more important for us to exist because we are really looking in places where other people are not and where resources are being pulled, to find these amazing entrepreneurs who are building the solutions that we need.”
