Good morning, Broadsheet readers! Longtime Salesforce executive Denise Dressler is Slack's new CEO, a new investigation reveals an alleged culture of misogyny and harassment at the FDIC, and Melinda French Gates has a strategy to redefine what a "smart bet" looks like in venture capital. Have a great Tuesday!
- A new definition. Melinda French Gates has always done things differently as an investor. At Pivotal Ventures, she and her team have invested in women-led funds and early-stage companies with the goal of transforming the way the venture capital ecosystem operates.
In a new op-ed for Fortune, French Gates explains exactly how that will work.
The investor and philanthropist sees opportunities for more “market-based solutions to overlooked problems,” like the caregiving crisis in the U.S. Pivotal has backed founder Helen Adeosun, whose company CareAcademy trains caregivers online.
To reach these goals, Pivotal is rethinking traditional markers of venture-capital potential and success.
For due diligence, Pivotal has introduced "alternative models of evaluating investment opportunities." This mainly applies to its work as an LP backing women-led funds, which are often smaller and newer than male-led funds. Rather than solely seek out funds that have hit a certain threshold of assets under management, Pivotal's investment team takes into account other factors—like founder feedback about working with the fund. "We aren’t lowering the bar in any way, just redefining what it means to meet it," French Gates writes.
With new definitions like this, French Gates hopes to move the needle on stats like the roughly 2% of venture capital funding that goes to businesses founded solely by women each year. She acknowledges the lawsuit against Fearless Fund, the Black women-led fund backing women of color entrepreneurs and its impact on these goals, too.
Openness to new ways of evaluating investments—and its knock-on effects for fund managers and founders—could "change the entire investment industry’s understanding of what a smart bet looks like," she says.
Read French Gates' full op-ed here.
Emma Hinchliffe
emma.hinchliffe@fortune.com
@_emmahinchliffe
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