Diageo’s investment arm Distill Ventures has announced the launch of a new Pre-Accelerator Programme that is committed to backing early stage founders from underrepresented groups.
As part of the initiative, Distill Ventures plans to invest $5 million in drinks entrepreneurs over the next 12 months.
The new investment drive aims to offer a more accessible runway to unlock seed funding, with entrepreneurs from underrepresented groups often finding this a key barrier. Diageo says racial and gender wealth disparities can mean founders from underrepresented groups have less access to capital.
According to a 2020 Crunchbase Diversity Spotlight Report, since 2015, only 2.4% of venture capital financing across all sectors in the US went to black and Latinx founders.
Distill Ventures says it will identify potential founders via its search pipelines, with an initial focus on the US and UK. Additionally, interested entrepreneurs are encouraged to apply for funding online.
Successful applicants will be awarded initial funding (between $250,000 and $500,000) and will work in collaboration with Distill Ventures to help bring their business plans to life. The companies will also have the potential to create a longer-term partnership with Distill Ventures and Diageo.
“In eight years, Distill Ventures has built a portfolio of next generation brands, but it has become clear to us that we want to dedicate focus on diversifying the ownership of drinks brands by addressing a key barrier head on: access to seed funding,” said Frank Lampen, CEO of Distill Ventures.
“We know that opportunities for entrepreneurs are not equally accessible to all, and so at the heart of our company-wide inclusion and diversity initiatives is the creation of a new Pre-Accelerator that will enable us to work with really early stage founders. This change cannot happen overnight, but we are excited to help evolve the drinks world, one founder at a time.”
The announcement supports Diageo’s commitment to grow a more diverse drinks industry and build a sustainable long-term business as part of its 2030 goals. It also comes shortly after Diageo launched Pronghorn alongside industry experts, a ten-year initiative that focuses on expanding diversity, equity and inclusion across the alcohol industry.
Heidi Dillon Otto, Distill Ventures North America managing director, said: “We recognise that diversity in ownership will fuel broader growth and innovation in our industry and will enable our portfolio to connect with a wider range of cultures and consumers.
“By bringing new, diverse founders into the world of drinks, we hope to create a ripple effect, in turn empowering them to mentor, hire, and train future drinks entrepreneurs.”
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