Pacific Community Ventures, a San Francisco-based nonprofit venture capital firm founded during the dot-com boom to fund job creation in low-income communities, is still growing at a time when the weak economy has many traditional venture capital firms struggling, the San Jose Mercury News reports.
In 1999, when many new millionaires in Silicon Valley were rethinking philanthropy, Bud Colligan, a venture capitalist at Accel Partners who made his fortune at Apple Computer in the 1980s, decided to apply the venture capital model of seeding startups to small businesses promising a social payoff in addition to financial returns. Originally called Silicon Valley Community Ventures, the organization set up an investment fund that gives millions to small businesses providing jobs in low-income areas. Colligan brought in advisers from venture capital firms and the nonprofit sector, and Accel gave him one day off a week and office space for the project.
The small businesses funded by Pacific Community Ventures are not held to the standards of traditional venture capital firms looking for double-digit financial returns. Instead, they must make a strong case that they can make money as well as a social impact — what Colligan calls a "double bottom line." Pacific Community Ventures has fared well: it now has a staff of seven, has raised a second fund that stands at $12 million, about twice the size of the first fund, and is looking to fund businesses outside of the Bay Area.