Flatiron, a New-York based venture firm, has launched two funds to promote what it calls “social entrepreneurship”, the Industry Standard reports.
The firm, which previously has funded 45 private companies, will seek to attract charitable givers through two separate funds – a public charity and a traditional venture firm, the Standard reports.
The Flatiron Foundation will make grants ranging from $200,000 to $500,000 to nonprofit organizations in three main areas: spreading technology among children, promoting entrepreneurship among disadvantaged groups, and engaging existing entrepreneurs in social change.
The Flatiron Future Fund, a typical venture capital fund, will back for-profit ventures with a social mission.
The fund hopes to turn budding social programs into self-sustaining businesses, the Standard says.
Initial capital will come from the Flatiron partners themselves, who hope to recruit other investors although the rates of return will be much smaller than what venture capitalists usually expect.
Social benefit – not high returns – will be the top priority for this fund, founder Fred Wilson says.