Baltimore-based investor McKeever Conwell II recently left Maryland tech development agency TEDCO to start his own venture capital fund.
With RareBreed Ventures, which launched this month, Conwell is taking knowledge he gained running the first state-backed, pre-seed fund for women and minority-led startups, and applying it to run a new VC firm.
For minority startups, there’s a huge gap in the ability to raise money in the “friends and family” stage of funding, which is often helps companies at the earliest stages as they build and test a new technology, and develop a business plan. That’s where RareBreed Ventures comes in: It’s designed to be the first investor, or among an initial group of funders, backing these companies.
“A lot of investors get their dealflow through networks, and it’s the same networks they’ve had for however long,” Conwell told Technical.ly during an interview for his recent appearance on the Off the Sidelines, an investor education podcast produced by at Technical.ly and sponsored by Project Entrepreneur, a program of UBS. “A lot of these underrepresented founders aren’t in those networks.”
A Morgan State alum and familiar face known as “Mac” to many around entrepreneurial events in Baltimore, Conwell has experience and knowledge from both sides of the early-stage spectrum, as he has been both an investor and founder. With TEDCO, he helped to launch the Pre-Seed Builder Fund, which piloted in 2017 with a focus on supporting Black founders before expanding to include a wider group of disadvantaged entrepreneurs. He also knows what it’s like to be an entrepreneur trying to seek funding, as he has two companies under his belt — one going well, the other not so well.
This experience gave him perspective on how the relationship runs two ways.
“The average early stage investment lasts longer than the average marriage in the United States,” Conwell said of those abusing leverage, whether it’s a founder with a hot startup or investor holding the purse strings. “If you’re going to be tied with somebody for that long, do you want to start off your relationship with a bad feeling — not liking how it all went down?”
To Conwell, the key thing to remember is that the relationship between founders and investors is a partnership.
“There needs to be a give and take from both sides,” Conwell said.
For investors, Conwell has this recommendation: “Go expand your network.”
The goal of RareBreed ventures is to have as diverse a portfolio as possible. When it comes to geography, the investment firm is focusing on companies outside of major tech hubs like New York or Silicon Valley. The firm is open to invest in all industries except life sciences.
RareBreed is seeking “companies building a software product that has a unique or clearly repeatable customer acquisition strategy. Or, in companies building a physical product in a vertical that has lacked innovation in 10+ years,” Conwell stated in a blog post.
The firm is currently seeking investors to raise a $10M fund. With its investments in companies, RareBreed VC is targeting a check size of $250K.
Donte Kirby is a 2020-2022 corps member for Report for America, an initiative of The Groundtruth Project that pairs young journalists with local newsrooms. This position is supported by the Robert W. Deutsch Foundation.