SWS, Microsoft invest $25M in minority-owned businesses

Seibert Williams Shank Senior Vice President Arion Williams joins Yahoo Finance to discuss the company’s new fund and its partnership with Microsoft.

Video Transcript

ALEXIS CHRISTOPHOROUS: As businesses look to make meaningful internal changes amid global protests against systemic racism, women and minority-owned investment bank Siebert William Shank announced the formation of Clear Vision Impact Fund with an initial $25 million seed investment from Microsoft. Joining us now to discuss is Siebert William Shank senior VP Arion Williams. Arion, good morning to you. Quite a nice seed investment there from Microsoft. What is the goal between the partnership between your company and Microsoft?

ARION WILLIAMS: Well, good morning. Thanks for having me on. I'd like to just give a very large backdrop overview of why the fund was launched. Number one was to bridge the capital access gap. Number two-- to be a part of a larger solution. So number one, we applaud Microsoft with this partnership. They recognize the need to support financially small businesses and in direct connection with communities. So our opportunity set here is to focus on those companies that have been traditionally overlooked by most financial services organizations.

- Have you put any of the money to work yet?

ARION WILLIAMS: Not yet. We are currently actively capital raising, looking for other partners to join us in this. We made a public announcement sometime last week that we are looking to grow the fund to $250 million.

ALEXIS CHRISTOPHOROUS: What kinds of companies? Give us an idea of the criteria you're looking at when you consider which companies to invest in. And also, you mentioned you want to raise a lot more money. Any other big-name partners that you can tell us about?

ARION WILLIAMS: Let's start with higher level. So the kind of companies that we're looking at, number one, are going to be growing concerns. We're not so much focused, this being our inaugural fund, on startups or early stage. But we want to focus on those companies that have a track record of operational performance, number one.

Number two, we'd like to look at companies that are fostering inclusive growth initiatives through sustainable business models and then those companies that are focused on expanding products and services to these underserved communities. So at a very high level, those are the companies that we're targeting.

And then maybe if we were to give some examples of companies, we like to call out that a lot of small businesses have one very large client. And their operations hinge on that one large client. So if that client decides to renegotiate the contract, cut costs, that can have detrimental effects across the board on small businesses. So our idea is if we're able to find those business-- which we've already received a lot of incoming calls-- where these companies are looking to expand beyond one client, companies that are looking to expand with a client-- you have a lot of companies who are saying, if we just had more resources, if we had better equipment, more infrastructure, we could do more, land larger contracts with the clients that we have. So those are two very large ideas, I think, that we're excited about exploring.

- They sound like some pretty compelling potential opportunities. Why do you think the banks are ignoring these types of businesses?

ARION WILLIAMS: I won't get into why some of the banks are not looking at this. But I can say we have always been thinking creatively about how we can do more from our platform as being a leading minority and women-owned investment bank. I believe that as ESG becomes even more topical across the investment conversation, we're uniquely positioned. We have an extensive network of public-private relationships, a very large organizational footprint across the country in more than 20 offices, affiliated with all sorts of civic and other nonprofit organizations where we can influence. We believe we can influence how measurable impact can be achieved with investments that are targeting these kind of underserved communities. So it may not be a focus, but it's certainly a focus for this fund.

ALEXIS CHRISTOPHOROUS: All right. Arion Williams of Siebert Williams Shank, thanks for being with us, and good luck with the fund.

ARION WILLIAMS: Thanks so much for having me. Thank you.