CityRock Fund II, a part of H/L Ventures, recently closed a $24 million fund to support founders from diverse backgrounds. The fund will focus on investing in companies in areas such as climate, healthcare, and the future of work. CityRock has various components including a venture studio and standard funds, which work on co-founding companies and investing capital. There are three funds within the venture studio, two CityRock funds, and a seed program supporting pre-Series A companies within the broader H/L portfolio.
CityRock Fund II will primarily focus on Series A investments, with an average check size of $1 million and a reserve for follow-on investments in companies previously backed by CityRock Fund I. The fund plans to invest in 14 Series A companies and a similar number of seed-stage companies through its seed program. Fund I, which was $17 million and closed in 2021, has already backed 15 companies including AndieSwim, Group Black, and Aunt Flow. CityRock aims to support founders from underrepresented backgrounds, considering factors such as gender, race, socio-economic background, sexual orientation, and military service as part of its definition of diversity. The fund prefers diverse founding teams, although it is not mandatory.
Oliver Libby, co-founder and managing partner of H/L Ventures, mentioned that fundraising was challenging due to the firm’s focus on growth, impact, and diversity. Despite the difficulties, there is still interest in diversity within investment strategies, as research indicates that diverse founding teams lead to positive outcomes. Libby emphasized the importance of supporting diverse founders in sectors like healthcare and climate, as they often bring unique perspectives that drive innovation in areas such as energy efficiency and health disparities.
H/L Ventures, founded in 2009 by Eric Hatzimemos and Libby, plans to deploy Fund II over a four-year period. The firm is dedicated to backing a diverse group of founders with a strong mission that can lead to financial success and benefit society as a whole. By investing in founders from varied backgrounds, CityRock Fund II aims to encourage innovation and positive change in the business world.
