Do What it Takes to Survive: Advice from Arlan Hamilton on How to Face the Post-COVID-19 Reality
Arlan Hamilton built a venture capital fund from the ground up, while homeless. She’s the Founder and Managing Partner of Backstage Capital, a fund that is dedicated to minimizing funding disparities in tech by investing in high-potential founders who are people of color, women, and/or LGBT.
Startup Grind’s CEO, Derek Andersen, recently met with Arlan to talk about what startups and companies need to “Do What it Takes to Survive” in our new COVID-19 world.
You can watch the full recording of their conversation here or continue reading for a few highlights.
Derek Andersen: We all read about [COVID-19] and we probably all know someone who has been really negatively affected by this crisis. Are there certain founders that are more at risk than others from what you’ve seen?
Arlan Hamilton: The title of this conversation [“Do What it Takes to Survive”] is dark — how to just make it. The next 18 months are going to be rough. They are going to be rough for different reasons and it’s going to be rougher for different people. It’s not always going to fall in a line based on race, gender, or proximity. But when it comes to things that institution has control over like PPE, that’s where you’ll find founders being left out. I believe they said 90% of black founders who applied for PPP were rejected which makes no sense at all whereas companies are getting 10–15 million dollars.
There’s that, but also within our portfolio there’s a great data-set to look at and we have some companies that are doing quite well. Some companies are doing quite well because of this situation. Some companies that have been not doing well have been just knocked over. And we have companies in the middle. We are a microcosm of what’s been going on.
Derek: It seems the word “survive” is taking on a new meaning right now. You have survived so many difficult situations, now you’re thriving. I’m wondering — if I’m a founder and I’m just figuring out how to escape this or live beyond it, how should I define survival or success in this situation?
Arlan: Everyone’s going to be a little different. I’m not trying to preach to you or Arlan-explain, but I think we take for granted the idea that some people don’t know it’s okay. It is okay to not compare yourself to other people. It is okay to not be in this hustle race. Even though everything being thrown at us tells us the opposite in startup land. It is okay to be really scared, concerned, worried, or to be mourning something. It’s okay to not know what to do or have a game plan or be wrong about certain things.
Right now, if you’re worried about ‘Well I won’t get to where I want to be. I won’t have a million-dollar company or ten million dollar company. I won’t have it because COVID-19. I won’t have it this year like I thought I would’ —who said you were supposed to? If it’s an investor, then I can have a word to you about that. They are going through stuff, too. But if it’s yourself and you compare yourself to other people or you two months ago, then we need to shake that out. We need to start talking about how you get to decide and you get to change what reality is and what your reality is. That is where there is more accountability and control that we have that we don’t necessarily believe right now. I want to instill that in people.
Derek: If I’m trying to hold onto jobs and people in the company versus doing what’s best for the business — which could be really hard and hurt people I care deeply about — how do I balance the two things?
Arlan: Ultimately, as hard as it is, you have to remember that the company is created as an entity on purpose. It’s created as a legal entity that is separate from you on purpose. You need to be accountable for it and you need to do the best job you can. They put that in place so you can make very sober decisions and you can do what’s right for the company. What’s right for the shareholders or investors is not always what’s right for the company. As a founder, CEO, executive part suite, board member, you need to make the decisions that are right for the company to try and keep the company going in a good way as long as you can. Coming from experience, you can try to keep more people on and the whole company falls apart sooner. It’s kind of like surgery. You have to be a surgeon. You have to think about what’s best for the body, what’s best for the company.
Derek: Change creates opportunity. And pain can create growth. As we look at this changing landscape, I’d love to get your thoughts on — if I’m an entrepreneur looking to shift and take advantage of the new opportunities that exist, are there easy things I can do? Additional income streams that I can find as a founder that I can get going quickly?
Arlan: What I would say is to the entrepreneur types — spend the next few days observing and talking to people about what they need most. You at least have a small moat of people where you could start, where your individualism is your edge right now, even it’s small. Find out what people need and that other people aren’t thinking about. Make a list. Pen to paper. Start brainstorming a list of what people are needing right now. And that’s where you’re going to find that ‘thing.’ Then you can double-down on and see if that works. If you try to go out and find something because you think it’s going to be it — even though it’s not what you’re passionate about because it’s safe — you might as well do what your parents told you when you were leaving home or at home now. You might as well just do that because that’s what you’re supposed to do. But if you have a little bit of curiosity and patience, I think you can find fun things to do.
Derek: Have you had startups pitching you virtually in the quarantine?
Arlan: I get pitched every single day, every hour of my life, truly by everyone.
The same rules apply in person as online. Be cool. Don’t be super aggressive, don’t be passive aggressive either. That really doesn’t work. You can’t believe the things people say to me when we’re alone that they think because we’re not in front of people they can get away with.
Practice your pitch with multiple people, not just your buddies. You want a little bit of friction feedback, critical feedback. At least you’ll know how you’re coming across. You shouldn’t change yourself. You can say you’re rough around the edges. But there may be something that you don’t know you’re doing or coming across a certain way that may be helpful.
Derek: How can we help you?
Arlan: Go get “It’s About Damn Time.” Get multiple. I promise you, the more people know about the book, the more opportunities I get. And the more opportunities I get, the more I can do, which takes it directly back in to this ecosystem.
You can purchase Arlan’s book at https://www.itsaboutdamntime.com/.
To get even more wisdom from Arlan, you can view the full video of the “Do What it Takes to Survive” event here.
For more opportunities to learn from experts, check out Startup Grind’s calendar of upcoming virtual events.
