Constellations Brands Ventures Set to Invest $100 Million in Selected Black-Owned Beverage Companies by 2030

On June 29, 2020, Constellation Brands (STZ) under its venture capital arm announced that the company is set to invest $100 million in Black-owned alcohol beverage startups by 2030.

Part of the company’s commitment to achieving greater equality for all its black employees and colleagues is initiating the “multi-initiative social justice action plan.” “The conditions that have allowed systemic racism to persist in the US have existed far too long,” said Constellation Brands President and CEO Bill Newlands.

In late 2018, the company started an initiative called the “Focus on Female Founders” which was targeted at empowering female-owned businesses in CBV’s portfolio. The percentage has soon increased from 20% to 50%.

This new initiative targeted at Black-owned small beverage companies is tagged “Focus on Minority Founders. The program follows the same template used to create the “Focus on Female Founders” program. Part of the company’s reason for initiating this program targeted at Black owners is to encourage and support Black-owned businesses in the industry. A study by Rate My Investor showed that between 2013 and 2017 the recipients of venture capital nationwide, had only about 1% of Black founders. Based on the study, 77.1% of the total number are white, and 90.8% are male.

Another study by the Brewers Association’s Brewery Operations also showed that only 1% of brewery owners in the industry are Black. 52.3% of breweries in the industry are solely male-owned, 31% have equal male-female ownership (usually a husband-wife kind of partnership), and 2% are solely female-owned.

According to Constellation Brands CEO Bill Newlands, the program “reinforces there is a real need for these programs, and they can drive measurable improvement in minority representation for our industry.” “These businesses serve as the fabric of their respective communities and we must make it more equitable for them to access the capital needed to have a fighting chance at success.”

In its press release, Constellation Brands also said it will put more efforts to “create greater equity for African American/Black colleagues.” Included in the release had a review of its unbiased recruitment, hiring, and talent development process. In addition, Constellation will also review its advertising policies, sponsorships, and brand activations, ensuring that they are “aligned to brand and company values.”

Earlier this year, Constellation Brands acquired a minority stake in Press Premium Alcohol Seltzer, one of the companies in the “Focus on Female Founders Program.” In the first year of the program, seltzer maker, Vivify was connected with over 150 wholesalers, while Austin Cocktails had a package redesign to boost sales.

In addition to its $100 million plan to support Black-owned businesses in the brewery industry over the next decade, Constellation said it will donate $1 million to the Equal Justice Initiative to begin a multi-year partnership.

Other alcohol beverage producers have also supported Constellation’s initiative. Constellation Brands CEO Bill Newlands signed onto CEO Action for Diversity and Inclusion, which is a business commitment to promote corporate diversity. Other alcohol beverage CEOs such as Lawson Whitning (Brown-Forman CEO), Gavin Hattersley (Molson Coors CEO), Albert Baladi (Beam Suntory CEO), Carlos Brito (Anheuser-Busch InBev CEO), Darrell Swank (Standard Beverage president), Steve Fechheimer (New Belgium CEO), and Deirdre Mahlan (Diageo North America president); have also taken the organization’s pledge.

“We categorically denounce bigotry, racism, and social injustice. They are clearly inconsistent with our company values and our commitment to embracing diversity and creating an inclusive environment where all employees feel safe, respected, and valued. We stand in solidarity with the Black community and we are committed to achieving meaningful and lasting change,” Newlands said in a release.