BOA Merrill Lynch CAF invests in promising private equity funds

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VonsheJenkins BOFAAt the recent National Minority Supplier Development Council Inc. Conference, Bank of America received the Corporate Excellence in Access to Capital Award. Bank of America Merrill Lynch Capital Access Funds Management LLC is a key component of the institutions goal of facilitating access to capital – a pivotal component, as MWBEs strive to compete in today’s increasingly global market.

CAF is devoted to investing in promising private equity funds that are either managed by emerging managers and diverse senior partners or that target underlying portfolio companies that are:

  •  Located in or employing residents of low- to moderate-income geographies,
  •  Owned or managed by ethnic minorities,
  • Owned or managed by women,
  • Focused on delivering products or services to an ethnically diverse customer base or
  • Located in urban or rural areas with limited access to investment capital.

According to Vonshe Jenkins, Bank of America senior vice president of supplier diversity and development operations, CAF’s investing efforts continue
to seed emerging private equity firms – particularly those with diverse management professionals and portfolio companies that utilize the talents of managers and owners of all backgrounds and provide employment in underserved geographies.

Documented Success

As a result of the team’s dedicated efforts, CAF has facilitated an allocation of more than $1 billion of institutional capital to 38 private equity funds led by diverse managers, Jenkins said. Furthermore, 82 percent of all CAF funds have general partners that have at least one female or ethnic minority partner and 58 percent of all CAF funds have general partners that have more than one ethnic minority or female partner.

Additional evidence that CAF is successfully executing on its mandates include:

Sixty-four percent of the companies provided capital to at least one of CAF’s targeted, underserved markets and nearly 40 percent addressed at least two of these markets.

  • Thirty-nine percent of the companies are partially owned by women entrepreneurs.
  • Thirty percent of the companies are majority-owned or managed by ethnic minorities.
  • Forty-one percent of the companies had some form of ethnic minority ownership.
  • Thirty-seven percent of the companies were located in low to moderate income areas in 2011.

“By the end of 2011, CAFís underlying portfolio companies employed approximately 102,000 individuals representing $2.9 billion in combined payroll,”
she said.

Upcoming Events

One way Capital Access Funds finds candidates is through hosting a series of strategic events. The M&A Summit is a prime example. This event is also hosted
by Bank of America Merrill Lynch, Council of Urban Professionals, National Association of Investment Companies,U.S. Department of Commerce Minority Business Development Agency and NMSDC. It is focused on how mergers and acquisitions, private equity, joint ventures and other strategic initiatives can create large-scale MBEs.

The M&A Summit provides CEOs, CFOs and corporate development leaders from several Fortune 100 corporations – as well as representatives of successful MBEs ó the opportunity to discuss their experiences and share best practices. Additionally, participation from private equity firms and firms from other sectors, e.g. professional services firms, critical to these transactions, contribute to a robust dialogue around increasing the number of MBEs of scale thriving in the marketplace.

CAF also hosts the Inner City Capital Connections program, which is a series of events designed to stimulate the flow of capital to inner city businesses.
To date, 375 inner city businesses have participated and raised more than $700 million in capital. In addition, more than 90 percent of participants secured
debt or equity capital within two years of participating.

Jenkins told MBN USA that MWBEs interested in learning more about the program, its upcoming event and how to get involved should start by visiting
the website at http://corp.bankofamerica.com/business/smb/bacaf-team.

MBN USA Vol. 2, 2014

 

By Peter Fretty

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