Backstage reflects after reaching 200th investment
Backstage Capital is excited to announce that we’ve hit our latest milestone in representation: 200 investments!
This milestone signifies Backstage Capital founder and managing partner Arlan Hamilton’s wildest dreams coming true 2x, she said.
“Meaning that in 2014 and ’15, when I was telling anyone who would listen that I would invest in 100 companies by 2020, I never imagined we’d be at 200,” she told Green Room. “It was my moonshot idea. One hundred was my moonshot idea. It also signifies and reconfirms what I knew a decade ago, which is that women, people of color, LGBTQ+ founders and others who are underestimated are simply that, are underestimated. And we’re always here. We were always building and innovating and being simply overlooked. So, this means a lot for the ecosystem.”
The 100–200 cohort includes companies led by underestimated founders, like Atoms, Bitwise, Maven, and Loop, as well as emerging companies where Backstage wrote the first check for the startup, like Frequency Machine, Barb, ReflektMe and AMP Beauty LA. While the average check size for our first 100 investments was around $40K, the blended average transaction 3x’d to $120K for investments 100–200.
Chacho Valadez, a principal at Backstage Capital, said the firm’s 200th investment is indicative of the brilliant underestimated founders building companies.
“They are consistently putting in incredible effort, creativity, and resourcefulness necessary to build great businesses,” he said. “They build with dignity while simultaneously being analyzed with a microscope of scrutiny.”
Backstage’s portfolio consists of companies addressing a variety of problems. There are media companies like The Juggernaut, Black Oak TV and Gal-dem building for large audiences, healthcare companies like Spora and Kiira Health redefining the experience for people of color and fintech startups like Guava, Suma and SoLo Funds trying to create more equitable financial products.
“The theme that runs throughout, no matter if we’re talking about a beauty brand or a space brand or a new protein to help someone walk who was paralyzed, you’re talking about founders who have been overlooked, undervalued, underestimated, and are changing the future for themselves and for others,” Hamilton said.
Javier Evelyn, founder and CEO at Alerje, is one such founder committed to changing the future for himself and for the millions of other people (myself included) who suffer from life-threatening allergies.
Alerje is developing a smart epinephrine auto-injector that easily attaches to a mobile phone. When someone removes the device in an emergency, the connected app will alert 911, parents, spouses and other emergency contacts with their location.
Backstage Capital invested in Alerje through our accelerator program in Detroit back in 2019. Evelyn said it’s “been an absolute value add” being part of the Backstage portfolio.
“Today we have a lot more funds and opportunities, and it’s because of the work that Backstage and even those that have come before have put in to make this a very special opportunity for founders that are underrepresented, under-appreciated, that are the future of this country,” he said.
While 200 may sound like a lot of companies, Backstage Capital General Partner Christie Pitts said the firm has barely scratched the surface. But at the same time, she recognizes Backstage has accomplished quite a lot.
“This milestone continues to prove our thesis that there are so many underestimated founders building great companies,” she said.
Brittany Davis, a general partner at Backstage Capital, echoed that sentiment.
“This again shows that there is clearly no ‘pipeline problem’ of not enough high-potential companies led by women, people of color and LGBTQ+ founders,” Davis said.
Mita Carriman is another founder doing incredible work. In 2019, Backstage Capital wrote the first check in Carriman’s company, Adventurely.
“They believed in us and the market for digital nomads before a lot of other people did,” Carriman said. “And here we are today. The entire world is now working remote. And as a result, the work from anywhere digital nomad lifestyle has gone mainstream and is expanding.”
Since Backstage’s founding in 2015, the landscape for underestimated founders has changed for the better, Pitts said.
“It’s great to have so many other collaborative firms in the marketplace,” she said. “It no longer feels like we are one of just a couple of firms that help underestimated founders with access to capital.”
Another change has been in Backstage’s overall strategy, Hamilton said.
“We have seen so much now that we can better determine what success might look like,” she said. “Our latest funds have been performing in a way that proves that out to us, but I still believe no one truly has it all figured out. I think we will continue to evolve and learn alongside our peers.”
Moving forward, Backstage also plans to focus more on follow-on investments rather than first-time investments in startups. What hasn’t changed, however, is Hamilton’s gut instinct that she continues to use to this day, she said.
“Somewhere around 60 investments,” Hamilton said, “I stopped trying to predict the future and figured out that trusting my instinct and trusting the founders and where they would lead me was the best strategy.”
