In 2021, the Carried Interest Fairness Act was introduced in the U.S. Congress. It threatened to raise taxes on private equity and venture capital investments by as much as 98%. The American Investment Council (AIC) asked us to create a campaign highlighting the importance of carried interest. We specifically endeavored to showcase how firms use carried interest to increase diversity among fund managers and invest in economically disadvantaged areas.
To achieve our goal of highlighting private equity firms that invest in underserved areas of business, our team flew to Atlanta, GA to interview the management team at Zane Venture Fund as well as the CEO of a small business they had invested in. We wanted to show our audience that private equity managers are not all Wall Street billionaires; the vast majority are passionate business people who have used their carried interest to reinvest in emerging entrepreneurs. Zane Venture Fund recognizes that diverse entrepreneurs and businesses face far more barriers for funding than their counterparts and therefore focus their investments on bridging this gap. We crafted interview questions to highlight how these founders define carried interest, how they use it to invest in these underserved businesses, and how it is an important risk mitigator.
Through this video, we demonstrated that private equity managers and those who benefit from carried interest are not just Wall Street billionaires. We showed how changing carried interest laws would hurt the opportunity for diverse voices to join the private equity space. We shared this video with policymakers to show the faces behind private equity investment. The bill stalled and never received a vote in Congress.