When I first saw the name South Loop Ventures, I thought of Chicago, where I lived for almost six years—and I told Zach Ellis, the Houston-based firm’s managing director and founder, as much. The firm’s name references Houston’s South Loop, which connects various historically diverse neighborhoods and is near the historically Black Third Ward, Beyoncé’s birthplace. But the fact that I thought of my own touchpoint is, actually, somewhat ideal. 

“It’s not just Chicago, there are all these regions around the country where diverse communities are,” said Ellis, who served as a U.S. Naval Officer before he was a VC. “South Central Los Angeles, Southeast D.C., South Philly, South Bronx, Southwest Atlanta—SWATS—all these areas. You’re ‘othered’ because you’re from the wrong side of the tracks, and you get this neighborhood affiliation. But it also becomes this point of pride. I’ve even played with the idea of one of our slogans, being ‘we’re all from the south side of somewhere.’”

Ellis recently launched South Loop’s first $21 million fund. Rice Management Company and Chevron Technology Ventures served as anchor LPs, with additional backing from Texas Capital Bank and The Great Commission Foundation of the Episcopal Diocese of Texas. It’s a busy time for Ellis, who was just this week announced as a Kauffman Fellow, the longstanding VC leadership development program. He’s building South Loop Ventures—just an hour’s drive from Galveston, where the Juneteenth holiday has its historical origins—on a strategy that looks quite rebellious right about now: Investing in entrepreneurs of color in Houston and similar urban ecosystems, who are working on problem-solving in sectors like healthcare, biotech, and advanced materials. 

“I don’t do this out of a sense of fairness,” said Ellis, who was previously manager at CVC PepsiCo Technology Ventures and managing director at Rev1 Ventures. “I do this out of a core belief that intentional innovation is good for society. We have problems that need solving and it’d be a crime not to get as many brains as possible trying to solve these problems. Why leave talent on the bench and profit on the bench by not investing in everyone?” 

South Loop’s portfolio currently includes breast milk freeze-drying company Milkify, life science sales AI platform PraxisPro, AI-powered tax software SmartWiz, and AI drug discovery platform CircNova. The firm invests beyond Houston, but it does represent a significant bet on the city and on Texas—which is home to four of the ten fastest-growing counties in the U.S. by percentage growth. Ellis looks to build on Texas’ talent, institutions, and economic strength to generate outsized returns in a high-potential market that remains underserved. When most people think of tech in Texas, they probably think of Austin—but Houston has the right ingredients to be a hub in its own right, he said.

“Houston has the third-most Fortune 500 companies of any city in the country,” said Ellis. “If you think about the IT departments, the engineers at energy companies—from mechanical engineers to systems engineers—the talent is here. It’s just about awakening that talent.”

See you tomorrow,

Allie Garfinkle
X: @agarfinks
Email: alexandra.garfinkle@fortune.com
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Venture Deals

– Maven AGI, a Boston-based enterprise AI agents developer, raised $50 million in Series B funding. Dell Technologies Capital led the round and was joined by Cisco Investments, SE Ventures, and existing investors Lux Capital, M13, and E14.

– Jet HR, a Milan-based HR and payroll processes automation platform, raised €25 million ($28.7 million) in funding from Base10 Partners.

– Multiplier, a Singapore-based AI professional services firm developer, raised $27.5 million in funding. Lightspeed Venture Partners led the $20 million Series A round and was joined by EDBI, SV Angel, and existing investor Ribbit Capital. Ribbit led the $7.5 million seed round and was joined by Operator Partners, LocalGlobe, Script Capital, angel investors, and others.

– Conveyor, a San Francisco-based sales process automation platform, raised $20 million in Series B funding. SignalFire led the Oregon Venture Fund and Cervin Ventures.

– Onebrief, a Honolulu-based operational planning and military staff workflow cloud platform, raised $20 million in Series C extension funding from Battery Ventures.

– Justos, a São Paulo-based auto insurance company, raised $16.5 million in funding. Ribbit Capital led the round and was joined by Kaszek, Endeavor Catalyst, and Scale-Up Ventures.

– Tensec, a Palo Alto-based cross-border financial services platform, raised $12 million in seed funding. Costanoa Ventures led the round and was joined by Quiet Capital, WillowTree Investments, Cambrian VC, and others.

– Grifin, a Tampa-based investing via spending app, raised $11 million in Series A funding. Nava Ventures led the round and was joined by TTV, Draper Associates, Gaingels, and others.

– Typedef, a San Mateo, Calif.-based AI data infrastructure for workloads, raised $5.5 million in seed funding. Pear VC led the round and was joined by Verissimo Ventures, Monochrome Ventures, Tokyo Black, and angel investors.

– Superscale, a Berlin-based AI-powered marketing solution for consumer companies, raised $5 million in pre-seed funding. Creandum led the round and was joined by Interface and s16vc.

– All In Food, a Los Angeles-based snack brand, raised $4 million in funding from Obvious Ventures.

– Other Half, an Orlando-based pet supplement company, raised $3 million in seed funding. Willow Growth led the round and was joined by Habitat Partners and Off Leash Capital.

Private Equity

– Battery Ventures acquired a minority stake in Descartes Underwriting, a Paris-based parametric insurance provider. Financial terms were not disclosed.

– J.C. Flowers acquired Wefox Italia, a Milan-based insurtech. Financial terms were not disclosed.

– PlayMetrics, a Raleigh-based youth sports management software provider backed by Blue Star Innovation Partners, merged with Stack Sports, a Dallas-based sports industry technology provider backed by Genstar Capital, which acquired PlayMetrics from Blue Star Innovation Partners and will be the majority owner of the combined company. Financial terms were not disclosed.

– Roima Intelligence, backed by Corten Capital, acquired TilliT, an Adelaide, Australia-based digital manufacturing services provider. Financial terms were not disclosed.

– Thompson Street Capital Partners acquired Bubbakoo’s Burritos, a Point Pleasant, N.J.-based fast-casual Mexican-fusion restaurants franchisor. Financial terms were not disclosed.

– Turnspire Capital Partners recapitalized USG Water Solutions, an Atlanta-based asset management and rehabilitation services provider to water companies. Financial terms were not disclosed.

Other

– LemFi acquired Pillar, a London-based credit fintech. Financial terms were not disclosed.

IPOs

– Caris Life Sciences, an Irving, Texas-based AI-powered oncology precision medicine platform provider, raised $494 million in an offering of 23.5 million shares priced at $21 on the Nasdaq. David D. Halbert and Sixth Street back the company.