Morgan Stanley Hits $50M Target For Fund Empowering Underrepresented Tech Entrepreneurs

Morgan Stanley Investment Management (MSIM) has announced the close of its Morgan Stanley Next Level Fund, aimed at early-stage tech companies led by underrepresented entrepreneurs.

The fund has closed at its target size of $50 million of total capital commitments with investors including Hearst, Microsoft, and Walmart.

Morgan Stanley’s Next Level

Morgan Stanley’s Next Level is MSIM’s impact-focused private equity business.

It makes privately negotiated equity and equity-related venture capital investments in primarily stage tech and tech-enabled companies with women or underrepresented founders as part of the founding team.

“We believe Next Level offers a differentiated and advantaged strategy to both investors and target companies in that it has the ability to leverage the global resources, brand, and capabilities of Morgan Stanley,” said Alice S. Vilma, co-head of the Next Level Fund.

“For companies, this access and institutional engagement could be critical to their success.”

The Next Level strategy will build off the expertise of the Firm’s Inclusive Ventures Lab, which is Morgan Stanley’s in-house start-up accelerator.

It promotes financial inclusion and provides access to capital for early-stage tech and tech-enabled companies led by underrepresented entrepreneurs.

The Portfolio

In addition to capital, each portfolio company may benefit from access to the global resources the corporate partners invested in the fund.

At close, the fund had deployed a quarter of the capital across nine companies.

Many of the companies were founded by underrepresented groups but also serve them.

For example, HourWork is a SaaS recruiting and retention platform founded by Rahkeem Morris and Rob Snyder.

AptDeco, co-founded by Kalam Dennis and Reham Fagiri as an online marketplace for second-hand and resale furniture with a verified community of buyers and sellers, is also featured in the portfolio.

Educational continent creation platform Encatos enables creators to teach next-generation learning, literacy, and life skills to children via culturally diverse narratives also received capital.

“We are pleased to increase access to capital for underrepresented founders in our target sectors, and we are proud to partner with like-minded companies that share our commitment to closing the early-stage funding gap,” said David N. Miller, Managing Director and Head of Morgan Stanley Private Credit and Equity.