A Financial Investment with a Guaranteed Return
What a week! Starting on Monday — continuing on Wednesday and concluding on Friday — I had the pleasure to lead the selection process for the Venture DC Black Tech Pitch Competition. The competition yielded 53 tech companies from DC, run by African Americans who are disrupting their respective sectors. On Thursday, I attended the State of Entrepreneurship, hosted by the Kauffman Foundation. Surrounded by peers and colleagues — the majority of whom were white and male — I was pleasantly surprised with the content of the Foundation’s presentations. @KauffmanFDN publicly acknowledged that entrepreneurship is not equally accessible by all people in the United States. More specifically, Wendy Guillies, President and CEO of the Foundation, noted that the “changes in the composition of America’s population are not yet fully reflected in the composition of our nation’s entrepreneurial population. This means that the portrait of U.S. entrepreneurs — 80.2 percent white and 64.5 percent male — looks a lot different than that of the overall U.S. population.” Kauffman’s research is available in their #ZeroBarriers report; I think it could easily be renamed #entrepreneurshipsowhite.
When I left the session, I was moderately excited. Victor Hwang, the Foundation’s new Vice President of Entrepreneurship, noted that moving forward Kauffman would focus on “ecosystems, market gaps and turning big ideas into action.” Maybe now the world would pay attention to what so many Black and Brown entrepreneurs have known and more importantly, experienced, for years. While the statistics are readily cited about increased entrepreneurship amongst African Americans, especially women, there seems to be little action (i.e. increased funding), or evidence of outcomes, that a change is underway.
So, what made my optimism rise? Kauffman funds a majority of entrepreneurial research and activity in the US. With an endowment of $2 Billion, and a new commitment to invest in big ideas, maybe Kauffman can turn this sinking ship of American economic prosperity and wealth creation around — especially for communities of color.
As I returned to listen to pitches from Black tech entrepreneurs my optimism turned to a sense of urgency. Over the course of three days I saw 22 companies. Many of these companies have made money and proven their value proposition. Others have proven customer adoption via beta sites and demo products. Every entrepreneur has made significant sacrifices and has given blood, sweat and tears to their ventures. And all need money!
As many individuals seek to create million dollar funds, take on LPs and begin the path to 10x returns, these entrepreneurs need help now. And the funds needed are not excessive. I met a Ph.D. graduate who with just $5,000 could create groundbreaking technology in healthcare. I met a woman who left her job and is helping parents and children across the US and with an investment of just $50,000 is now poised to generate over $1M in revenue. And I met three men of color who are moonlighting in the shared economy to help homeowners across the country who have chosen to self-fund because they are tired of being taken advantage of by prospective angel investors.
When will we stop talking about the problem and make an equitable investment in entrepreneurs of color?
I am calling on everyone who has access to funds to help Black and Brown entrepreneurs across the US — NOW. A small amount of money can go a long way — from supporting product or sales expenses to providing validation of the entrepreneur. Rest assured I make this request based on experience. I founded Venture DC in 2015. Since its inception it has awarded six African American entrepreneurs with cash support, mentorship and training. During the first year of the competition, one of our winners received $2,000. With those funds, she left her job, created a beta site and secured a provisional patent. During the second year, one of our winners completed her product and secured a contract to initiate sales. Another winning team was selected as a “Company to Watch” at Startup Grind Global in San Francisco next week.
Who knows what great entrepreneurs will be discovered at this month’s Venture DC Pitch Competition?
Join me and many others on this journey to make entrepreneurship accessible for communities of color in the United States.