Meet the woman at the helm of the first institutionally backed, Black-led venture fund in Canada.
A conversation with principal & fund manager, Lise Birikundavyi.
As Vice President, Client Diversity at BDC, Laura Didyk is leading the bank’s efforts to understand and address the challenges faced by underrepresented and underserved entrepreneurs — whether they be racialized, identify as women, identify as members of the LGBTQIA2S+ community, be living with a disability, or exist within a combination of these identities. She’s sharing their journeys through conversations, and this month it’s with Lise Birikundavyi, principal & fund manager for Black Innovation Capital.
In Canada, fewer than one in ten venture funds have a woman as a managing partner. Narrow that down to Black women and institutionally-backed funds, and there’s only one: Lise Birikundavyi. She is principal & fund manager for Black Innovation Capital, a $10 million VC fund that invests in Black-led tech start-ups, backed by BDC Capital, and launched in June 2021.
Before taking the helm at Black Innovation Capital, Lise worked in finance internationally for a number of institutions. Raised in Montreal, her journey has taken her to Argentina, China, Ghana, Côte d’Ivoire, and back to Toronto (picking up French, English, Spanish, and a bit of Mandarin along the way). Through her education and career, she’s steered her work towards social entrepreneurship and impact investing.
Lise is a firm believer in using the forces of capital markets as a basis for the more inclusive wealth creation and sustainable poverty alleviation. I caught up with Lise to discuss her impressive journey, culminating in the recent launch of Black Innovation Capital.
Laura: You’ve focused a lot of your career on finance with a social purpose. How did you get started down this path?
Lise: It started when I was 18 and went back to Burundi for the first time — I grew up in Montreal, but I was born there. It’s a country that’s had its share of issues; poverty, civil unrest, and access to education are some of the main ones. I didn’t know what I’d find when I arrived, but I was amazed by the beauty of the country and the intellect of the people.
One thing that really struck me is that most people’s idea of success meant working at a large institution or at an international organization. There weren’t many locally owned businesses. When I talked with people about their entrepreneurship ideas, they would always say, “you should start one,” or “you should do it.” And I kept thinking, I don’t live here, why don’t you do it? I realized that an unintended consequence of humanitarian aid was that it was weakening the entrepreneurial spirit.
“I realized that this was real empowerment — supporting the creation of role models in different societies by giving them the means to build something on their own which would then have a ripple effect in their communities.”
A few years later in Argentina, I stumbled upon the idea of social entrepreneurship. I found the book How to Change the World: Social Entrepreneurs and the Power of New Ideas by David Bornstein and began learning about microfinance. I liked the idea of doing good while building capacity and making money. I realized that this was real empowerment — supporting the creation of role models in different societies by giving them the means to build something on their own which would then have a ripple effect in their communities, without anyone feeling indebted as the financial benefit would be shared.
Laura: I love that. I know you started out working in hedge funds, though — how did you steer your career into impact investing?
Lise: I loved working in the hedge fund world but I knew there was something more I could be doing, I just didn’t know how to enter the development space from an empowerment perspective. A good friend started talking to me about impact investing, and I began to meet with a group of women bankers in Montreal organising regular events to talk about what it was and exploring how we could develop it in Canada.
I decided I would try to create my own pathway in impact investing with an outlook for emerging markets. I went on to do my MBA in Shanghai with three goals: to learn Mandarin, to create a strong network, and to understand the China-Africa relationship. Everything I did there was around impact investing, and I took the opportunity to carefully craft my next steps.
At the beginning, my focus was emerging markets with a development outlook. The goal was to make sure huge problems could be solved by empowering people to solve them, while making money for the fund I was working for at the time.
Laura: What came next for you after Shanghai?
Lise: I came back to North America, but when I got pregnant with my first son, I decided we should go live and work in Ghana. I had always wanted to experience living on the African continent and I assumed, naïvely, that I would get bored staying home with a baby. I was up for another adventure and wanted to continue my impact work. In Ghana, I worked supporting Engineers Without Borders, Canada. We found a community there and it was a beautiful experience. We then spent three years in Côte d’Ivoire, a country located on the south coast of West Africa, where I was managing an edtech fund for the Jacobs Foundation.
Laura: And then your next step was Black Innovation Capital. How did that come about?
Lise: When I decided to start this adventure with Isaac Olowolafe to found Black Innovation Capital, it felt similar to the work I had done in Africa — despite it being a completely different market. The fund was about economic empowerment, working with a population that is not receiving the funding it should, and wanting to help them create wealth that can be reinvested in the community. For us, it’s not about one community versus another, it’s about the greater participation of all communities in the VC space. It’s about diversity and inclusion and everyone contributing to a better system.
Having BDC come on as our anchor investor really helped to bring the fund together; we’ve loved the experience and the support we’ve received in everything from working out the funding model to facilitating first time fund managers. We launched officially June 7 of this year, and are currently in negotiations for our first investments.
Laura: What’s the vision for Black Innovation Capital? What sets it apart from other VC funds?
Lise: Our hope is to help build successful Black-led tech businesses, deliver returns to our investors, and increase the diversity in the venture capital ecosystem. So overall, our main theme is diversity.
Any business we invest in must be Black-led — that’s at least 25% of ownership or executive management — and an early-stage tech company. We expect the teams will come from various backgrounds, because within Black communities you tend to see many different backgrounds and perspectives.
“So far, what we’re finding among the companies we’re looking at is this embedded resilience. Many have had a hard time finding financing and have had to be really creative to get to where they are at now.”
So far, what we’re finding among the companies we’re looking at is this embedded resilience. Many have had a hard time finding financing and have had to be really creative to get to where they are at now. We are also seeing a lot of inclusive products and services, solving problems from different angles and perspectives. And that’s exactly what we’re looking for: start-ups that are doing things differently, addressing needs that aren’t currently being met, and bringing about serious improvements to concepts that already exist.
Laura: So, is Black Innovation Capital an impact fund?
Lise: To me, impact investing is doing good while doing well — making money while creating a positive change in society. While Black Innovation Capital isn’t technically an impact fund, it does have an impact that’s very close to my heart. I understand what it is to feel like you have to work harder than the rest, that you’re not measured against the same standards and making a mistake is not an option. In creating tools that are helping with wealth creation or empowerment in general, I dream of a world where we don’t have to have these conversations with our children. Where diversity becomes the norm. To me, that’s the real impact.
Laura: Is VC funding right for everyone? What about other options for Black entrepreneurs, like loans?
Lise: It’s great to see more support emerging for Black entrepreneurs, such as the Black Entrepreneurship Startup Program or Black Entrepreneur Loan Fund. Both offer funding and mentorship which is an important combination for growing your business. Choosing between a program like these, extending loans, or VC investment really depends on you and your business — because both come with different terms and serve different needs.
One of the biggest differences between venture capital and a loan is the loan is paid back on set terms. With venture capital, we mainly use equity, which means that we invest in your company and our return on investment generally depends on how well your company does, so the kind of partnership you have with a VC fund can often be a bit more hands-on. We’d expect you to call us for support when you don’t know what decision to make. We’re there for the long run, we’re partners in growth, and we really take the risk along with you.
In any instance, what is most important is to get advice to determine what is the best financing model for you and your business.
Laura: We know that Black entrepreneurs struggle to secure capital and find role models. What do you see as some of the issues causing this, and how do you hope to address them?
Lise: There are many reasons Black-owned businesses aren’t getting capital. It’s important to recognize that unconscious bias exists everywhere, including in investing. People typically invest in individuals and concepts they are familiar with, not always based on their values, experience or a sound business case.
What we often see are mentorship programs that don’t come with access to capital. To be successful, you need both. We’re trying to solve this issue of over-mentoring and under-investing.
“From a role model perspective, it’s really nice that Isaac and I represent a Black man and a Black woman leading this initiative. The goal is to change the perspective for younger generations and make them see that it is possible for them to do whatever they decide to do.”
On the part of the entrepreneurs, there is also sometimes a lack of awareness — they don’t know where to go for help. The investment communities are siloed and often lack diversity. That can lead to a lack of confidence for some Black entrepreneurs. Even if they have a good idea, they don’t necessarily believe others will be interested in it.
From a role model perspective, it’s really nice that Isaac and I represent a Black man and a Black woman leading this initiative. The goal is to change the perspective for younger generations and make them see that it is possible for them to do whatever they decide to do. We will be investing in companies that will eventually create massive success stories, and those leaders will become models of success as well.
Laura: What’s your advice for Black women entrepreneurs, who face barriers both because of their gender and their race?
Lise: My advice is simply to be daring, laser-focused, and know your value. A lot of Black women are actually fearless, not afraid to be louder and go where they should not be. Many feel they have nothing to lose. I want us to teach our daughters to educate themselves, to never be afraid to express an opinion if rooted in truth, even when it seems unpopular, and to seize opportunities when they present themselves. Just because we haven’t seen many others who look like us be successful in a certain field, it doesn’t mean we should put limits on ourselves. And, be sure to support others along the way!
Laura: In five years from now, what do you envision for the Black Innovation Fund?
Lise: I’d like to see a lot of success stories, for the companies we invest in, for ourselves, and as importantly for the VC space in general. We’re also working to shift the investing lens by training Black investment managers who will be placed in the VC ecosystem to help create more diversity at the decision making level. We hope for that to be the norm — more diversity not only in the companies seeking investment dollars but in those making the investments. In five years, my hope is to see larger size funds for Black-led or BIPOC-led initiatives in the private equity and venture capital space. In 15-20 years, I hope they no longer exist because they won’t be needed anymore — that diversity will be business as usual.