Houston-Based VC Firm Raises $21M To Invest In Diverse Founders

Houston-based South Loop Ventures announced a $21 million Fund I, led by Rice Management Company and Chevron Technology Ventures. Texas Capital Bank and The Great Commission Foundation of the Episcopal Diocese of Texas also participated in the funding round.

According to its founder and managing director, Zach Ellis, the fund will focus on founders nationwide but hopes to attract founders in healthcare, energy, space, and climate. The firm has made 13 investments and hopes to increase to at least 30.

Investing in diverse founders

The firm launched in 2022, focusing on seed and pre-seed companies and founders of color. “We thought it was important to have a fund focused on diverse founders here in Houston, given Houston’s diversity,” Ellis told TechCrunch.

When asked if he was concerned about the anti-DEI backlash, considering his fund focuses on founders of color, he said, “We strongly believe that venture capital should be accessible to everyone and that underinvested and diverse teams offer a unique opportunity for significant returns.

The website says, “We envision a future where diversity is not just celebrated but ingrained in every aspect of business and where entrepreneurial success knows no racial or ethnic boundaries.”

Who is Zach Ellis?

Before creating South Loop Ventures, Ellis was an active duty officer in the US Navy for seven years. He eventually transitioned into the corporate world, working as a healthcare consultant, where he was exposed to a corporate innovation group.

He became the Managing Director at Rev1 Ventures, corporate venture capital at PepsiCo, strategy consulting at Humana, and commercializing university research at The Ohio State University and the Wisconsin Alumni Research Foundation.

Image: Rice Business