Silicon Valley Superwomen: No BS Breakfast Recap with Brittany Davis
Originally published by James A Wilson. August 6, 2018.
For the last few months our Bay Area Early-Stage team has been hosting a “No BS Breakfast” for a small group of founders and investors. Most recently we were fortunate to be joined by Brittany Davis @ Backstage Capital. Since Arlan launched Backstage in 2015 the fund has invested roughly $5MM into 100 startup companies led by underestimated founders; about a year and a half ahead of their original 2020 target ! Backstage also launched a new fund for black female led companies, and is looking to announce another funding opportunity soon.
Below are the top 5 things to know from our conversation with Brittany:
- What is the story behind Backstage and how did Arlan decide to focus on female, minority and underrepresented founders?
Arlan Hamilton, the Founder and Managing Partner of Backstage Capital built our venture capital fund from the ground up, while homeless. In 2012 she began to see how money was being made through investments in fast-growing early stage tech companies. However, it became clear that these investors were not investing in certain types of founders — in particular, women, people of color, and/or LGBTQ led companies.
Arlan saw first hand some of what recent data has shown about VC funding available for women (2% of VC goes to women, 0.2% of VC goes to black women). Whether consciously or not, many VCs are underestimating founders that are people of color, women and/or LGBTQ, because they might not fit the mold of what has been successful in the past. She saw this as an opportunity and put everything she had into launching Backstage Capital in 2015 as a fund dedicated to investing in high-potential founders who are of color, women, and/or LGBTQ. Not because it is a nice thing to do, but because many other VCs are missing out and leaving money on the table, and we truly believe this to be one of the biggest opportunity in venture investing today.
Arlan set the goal of investing in 100 companies by 2020 to show the industry that these types of founders are out there building companies, and help disprove the notion that there is a “pipeline problem” of not enough diverse entrepreneurs building investable companies. This really is not true !
2) What qualities does Backstage look for in founders when making investment decisions?
We spend a lot of time understanding the founder and the problem that they are solving. As early-stage investors, we realize that the solution itself might change over the company’s journey, but we believe the founders need to have deep passion and knowledge for the problem they are solving in order to be successful in their market over the long-term.
We also look for founders that know how to get a lot done with a little and do what it takes to build their business even when resource constrained. This type of hustle is necessary to make it through the ups and downs of building a company. I have been blown away by the founders who are truly able to make a way out of no way and this is a characteristic of founders we like to back.
Importantly our investment team consists of folks of diverse races, genders, educational backgrounds, and career experiences so that we are able to see different opportunities and avoid some of the blind spots that many investors have.
3) What advice do you have for female and minority founders when they are out raising capital?
Be CONFIDENT in your company and what you are capable of !
- When speaking to investors, it is your time to shine and give us an opportunity to back you, so it is definitely not the time to hold back or undersell what you are bringing to the table.
- Present optimistic projections and OWN them, showing us exactly how you plan to get there. I really want to know how you see the true opportunity of your business, while still being thoughtful and realistic.
4) How does Backstage work with portfolio companies to help them grow?
Essentially, Backstage has become a hub for a lot of resources and interest in underestimated founders, and we are working to take all that support and route it to our founders. A few key things that come to mind are our platform of services including:
1) Mentorship — Backstage has built a network of mentors who are all leaders in their fields and are excited to lend their time and effort into supporting our Headliners (our portfolio companies)
2) Community — We have a thriving community of Headliners; all underrepresented founders in our portfolio that are now connected to each other, and have become a great resource to one another
3) We also do a great job of amplifying what our Headliners are doing and increasing the public’s awareness of their impressive work. To see for yourselves, follow us on Twitter @Backstage_Cap, check out our podcast Bootstrapped VC read our Blog.
5) Can you highlight a recent investment that you are excited about and why?
One of our most recent investments is in a company called Airtailor led by Founder and CEO, Joshua Brueckner. Airtailor is building an innovative solution to clothing fit through their leading-edge clothing alterations platform that connects skilled tailor shops with consumer’s closets and favorite retail brands.
When Joshua initially reached out to us, he explained his story about personally having to learn how to alter clothing to be suitable for job interviews after a layoff. He turned that into an online necktie alterations company serving thousands of customers. After realizing that the need for more convenient clothing alterations was huge, he began building the business to address the opportunity he saw. Joshua has a big vision and plan to solve a multi-billion dollar challenge that customers and retailers face, but it was also clear and impressive how he has been scrappy in building what they have so far, and we are excited to have the opportunity to back him.
The No BS Breakfast is an exclusive monthly event for a small group of clients in the SVB community. We hope to create a space that allows our founders to connect and engage with VCs and fellow founders who are at a similar growth stage. Stay tuned for the next recap of our No BS breakfast in August with Andrew Byrnes @ Comet Labs. If you are interested in joining future sessions feel free to reach out to me (jwilson@svb.com).
