Morgan Stanley Investment Management (MSIM) has concluded the fundraising for the Morgan Stanley Next Level Fund, L.P. (Next Level), reaching its targeted capital commitments of $50m.
The strategy has garnered support from inaugural corporate partners, including Hearst, Microsoft, and Walmart, along with investments from Altria, Ten Figures Ventures, and Phalanx Impact Partners.
Next Level, an integral component of MSIM’s $200bn alternative business, extends its reach by drawing on the expertise of the Morgan Stanley Inclusive Ventures Lab and HearstLab. The fund focuses on investing in primarily early-stage technology and technology-enabled companies, prioritising those with underrepresented members in their founding teams.
Target sectors encompass technology, consumer/retail, financial technology, healthcare, consumer products, and media and entertainment. Beyond financial backing, portfolio companies gain access to the global resources and capabilities of the corporate partners who have invested in the fund.
Morgan Stanley Next Level Fund co-portfolio manager Alice Vilma said: “There is an immense opportunity to provide overlooked entrepreneurs with much-needed capital and resources to help them succeed. With the support of our corporate partners, we are committed to driving a more equitable funding landscape for promising startups.”
Upon its final close, the fund has already deployed a quarter of its capital across nine companies. Many of these enterprises not only have founders from underrepresented groups but also cater to them.
For instance, HourWork, a SaaS recruiting and retention platform founded by Rahkeem Morris and Rob Snyder, received funding to revolutionise hourly work and the gig economy by matching employer demand with workers possessing certified skillsets.
Additionally, the fund participated in Series A funding for Bodily, founded by Tovah Haim, which provides information and products supporting women from pregnancy to postpartum and those experiencing pregnancy loss.
Morgan Stanley private credit and equity managing director and head David Miller said: “We are pleased to increase access to capital for underrepresented founders in our target sectors, and we are proud to partner with like-minded companies that share our commitment to closing the early-stage funding gap.
“In addition to providing capital, our differentiated investment approach alongside our fund partners’ strategic expertise seeks to improve financial and operational outcomes for our portfolio companies.”
Debevoise & Plimpton was the legal counsel to Next Level throughout the fundraising process.
