Showing posts with label Black people. Show all posts
Showing posts with label Black people. Show all posts

Tuesday, April 9, 2019

List of Black Women who work for venture capitalists

The following lists some of the Black women working for VC firms. While we think this is a good sign, remember - the problem is with the VC model itself, not with the color or gender of the people who populate the firms. You're still not going to be able to get money from these firms unless you fit the demographic they prefer. See: Small Business Financing, Black People and Venture Capital

Black Woman VCs (click on their name to be taken to their Crunchbase profile...or look them up on LinkedIn.)

Jacqueline Grant
Principal, Abingworth

Karen Kerr
Executive Managing Director
GE Ventures

Nicole Walker
Partner, Venture Capital – Healthcare
Baird Capital

Candice Matthews
Co-Founder and Executive Director
Hillman Accelerator

Tracy Gray
Founder and Managing Partner
The 22 Fund

Abyah Wynn
Co-founder and Managing Director
Twenty65 Fund

Monique Idlett-Mosley
Managing Partner
Reign Ventures

Erica Duignan Minnihan
Founding Partner
1000 Angels and Reign Ventures

Nicole Sanchez
Investment Partner at XFactor Ventures

Diane Henry
Technology Angel Investor
Rogue Capital Collective

Lorine Pendleton
New York Chair, TIGER 21
Investment Partner - Portfolia

Ita Ekpoudom
Partner
GingerBread Capital

Jillian Williams
Investment Principal
Anthemis Group

Mariah Lichtenstern
Founding Partner and Managing Director
DiverseCity Ventures

Monique Woodard
Early Stage Investor

Hadiyah Mujhid
CEO and Founder
HBCUvc

Shauntel (Poulson) Garvey
General Partner
Reach Capital

Sydney Sykes
Co-Founder, Co-Chair
BLCK VC

Adina Tecklu
Venture Investor
Canaan Partners

Uriridiakoghene (Ulili) Onovakpuri
Partner
Kapor Capital

Sydney Thomas
Senior Associate
Precursor Ventures

Saturday, September 8, 2018

Feedback on “How to Finance a Black Women-owned Business in 2018”

We recently held a series of webinars designed “to help black women business owners discover various ways to land capital.” The webinars, titled, “How to Finance a Black Women-owned Business in 2018” were held on July 18th, August 10th and August 24th.

The feedback from the webinars is good. Eighty five percent (85%) of the respondents to our customer satisfaction survey found the webinar useful. Seventy one percent (71%) rated the webinar excellent.
















Of the forty or so women on the webinar (and they were all women) forty two percent (42%) have just started looking for business financing. Fourteen percent (14%) have been looking for business financing over the past one to six months, and twenty eight percent (28%) have been looking over the past six to twelve months. Fourteen percent (14%) have not attempted to get financing yet, but are simply exploring options.


















This dovetails with the recent efforts we have observed in this sector. The table below lists some of the new funds that have been created to finance Black women owned businesses:

We believe this is a recognition of the higher than average returns that might be available in companies founded by those in overlooked communities.

As we noted in a recent article in the Journal of Financial Planning :

“Common sense will tell you that in an environment, a culture, and an economy that is getting more diverse all the time, that the diverse company is going to have more customers, and this should lead to higher revenue and higher profits, assuming their costs are under control. They should do better over the long term than the non-diverse company.

We researched that [premise] and found that that is the case, but there is a but; it really depends upon the industry you’re in. If you’re in a consumer-products type of industry, of course, more customers is better than fewer customers, and that’s all it boils down to.

We did some of this initial work for the magazine, DiversityInc. We did the statistical and investment analysis and found that our thesis about the higher alpha for a portfolio comprised of companies that are top performers within the sector diversity/inclusion was correct.”

We will continue to provide information in this space, and will schedule another broadcast of our webinar. If interested, please email us at info@creativeinvest.com.

Sunday, August 23, 2015

Black People and Venture Capital

I recently gave a talk at the 2015 National Black MBA Association Washington DC Chapter (NBMBAA-DC) Entrepreneurship Expo. My talk, titled “Black People and Venture Capital” available below.
I started with a discussion of the key financial institution in the country, the Federal Reserve, which controls the allocation of capital via monetary policy, the tools used to control the supply of money. The Fed is located at 20th Street and Constitution Avenue N.W. and I encouraged DC entrepreneurs to visit the institution, since the Fed directly impacts the ability of small businesses to get capital.
I also encouraged Black businesses in DC to use the recently established Offices of Minority and Women Inclusion as a powerful potential source of capital and contracts. Section 342 of the Dodd-Frank Wall Street Reform and Consumer Protection Act contains a provision creating an Office of Minority and Women Inclusion (OMWI) responsible for monitoring diversity efforts at the agencies, regulated entities and agency contractors. (For those unfamiliar with these Offices, we offer a seminar describing in detail the duties and performance of the 29 OMWI Offices. http://www.eventbrite.com/e/office-of-minority-and-women-inclusion-omwi-performance-opportunities-for-minority-and-women-firms-tickets-4633212062 )
In my talk, I cite my belief that crowdfunding, or raising money online for people, projects and products, is one of the only viable ways Black companies can get funded, as detailed in my books on the subject: Top 50 Crowdfunding Campaigns: Fifty Most Successful Crowdfunding Campaigns at:http://www.amazon.com/dp/B00RKK4NL0 and The JOBS Act: Crowdfunding for Small Businesses and Startups at: http://www.amazon.com/JOBS-Act-Crowdfunding-Businesses-Startups/dp/143024755X/
Key trends in crowdfunding include the following:
• Kickstarter and Indiegogo continue to dominate crowdfunding.
• Corporate America is into crowdfunding..major brands, including Kia and Kimberly-Clark, have launched campaigns to test the market for new products.
• Startups raised $204 million through equity models in 2013; that number was expected to top $700 million—7 percent of the overall crowdfunding market—in 2014.

I also discuss my belief that the key to getting angel or venture capital funding lies in being referred to investors by another investor or entrepreneur. A good way to do this is via Keiretsu Forum, a global angel investor network, but I noted they have not funded a single African American firm.

I referenced “Dunbar’s Number”, named for psychologist Robin Dunbar, who found that “humans are able to maintain relationships with no more than roughly 150 people at a time.” Dunbar’s research shows that “when it comes to meeting people who can help you professionally, three degrees of separation..is the magic number because when you’re introduced to a second- or third-degree connection, at least one person in an introduction chain personally knows the origin or target person.” 

As I said on Mashable, http://mashable.com/2014/07/21/startup-racism/ 1% of VC funding goes to Black people. This is no accident. Other studieshttp://elitedaily.com/money/venture-capitalists-still-overwhelmingly-fund-white-male-entrepreneurs-minorities-women/ have confirmed that “venture capital funding overwhelmingly goes to white men.” Given this, it makes no sense to solicit funding from people you know are not going to fund you. Viable alternatives include crowdfunding, angels, bootstrapping and possibly, bank financing (but not really).

At one point, I outlined a strategy of buying real estate in Black communities to use as an asset for a startup franchise location. Further, I referenced my Blank Crowdfunding Business Slideshttps://drive.google.com/file/d/0Bx3S91AlzNJ4Uk1qc3czckpKRWRIcC1RX0dVcWlkUjJsZ2M0/view?usp=sharing as one way to begin to outline your startup capital needs.

I discussed using credit cards, personal loans and other resources to accumulate enough capital to start a business and about how “an increasing number of VCs want startups to engage in crowdfunding before requesting backing” but how VCs are still too racist and greedy to allow Black companies the room they need to serendipitously discover and uncover market value. I pointed out how this was exactly how Google uncovered the strategy that eventually led to a $200 billion market value.

Finally, for those determined or foolish enough to pursue VC funding, I discuss the main reasons why people don’t get funded:
  • Your character, integrity or leadership is questionable
  • You failed to spot issues with your team because you’re too trusting, too polite, or too focused on yourself
  • Not referred to investors by another investor or entrepreneur
  • Hard-headed to the point of being unable to listen to input from an experienced, reasonable and knowledgeable investor
  • Not deeply embedded in your niche or area of expertise
  • An inability to stop, and think,
and finally, 
  • 99% of VCs are racist and/or sexist.

Friday, July 5, 2013

'Minority' Bank Designation Has Become Meaningless

We note with interest the designation of Urban Partnership Bank as a Minority Depository Institution. According to Crain’s Chicago Business, “The $1 billion-asset bank based on Chicago's South Side
(formerly South Shore Bank) is officially a minority lender despite an ownership dominated by Wall Street giants like Goldman Sachs Group Inc. and J.P. Morgan Chase & Co.”

A Minority Depository Institution, as defined by Section 308 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 ("FIRREA"), used to be a bank in which 51% or more of the common stock was owned by one or more members of the following groups: Black American, Asian American, Hispanic American, or Native American.

The threshold now for MDI designation is a bank that meets one or more of the following standards:
  • 1.       51% or more of the common stock was owned by one or more members of the following groups: Black American, Asian American, Hispanic American, or Native American.
  • 2.       51% or more of the members of the Board of Directors are one or more members of the following groups: Black American, Asian American, Hispanic American, or Native American and the community the banks serves is primarily minority.
The FDIC expanded the MDI definitions because is says it found the old definition “ambiguous.” Now a bank that does not meet the ownership test can be designated an MDI if 51% or more of the directors on the board are members of those minority groups and the community the banks serves is primarily minority. This is how Urban Partnership Bank was able to obtain recognition as an MDI.

This means that any institution, no matter how discriminatory, can obtain this designation. The MDI designation is valuable because banking regulators use deposits in minority banks made by non-minority banks as evidence that the non-minority bank is not breaking the law by discriminating against racial minorities and that it (the non-minority bank) is meeting community credit needs.

The MDI designation originally helped Black-owned banks, whose historical significance was clear: they were created at a time when discrimination against Black people was legal in the US. They served as the only financial service providers to the community. Black banks do not now have the same level of significance to the Black or minority community today. They are too small to serve the community in any meaningful way. For example, they cannot serve as a line of defense against predatory lending. The result: banks like Wells Fargo are free to target wealthy black communities for predatory loans, in a nakedly discriminatory (and ultimately successful) campaign to strip wealth out of the Black community.

According to a June 12, 2012 article in the Washington Post, one Wells Fargo loan officer, “in sworn court testimony..described watching loan officers comb through heavily African American areas such as Baltimore and Prince George’s County, forging relationships with churches and community groups to sell their members (predatory) mortgages.” This same loan officer “processed loans for (Black) homeowners with sterling credit ratings with higher interest rates than they needed to pay.”

Of course, some will claim that the actions of a few bigoted individuals cannot mark an entire institution as racist. We disagree, and refer to the clear double standard concerning these matters, evidenced by the treatment of ACORN, after a few individuals at that non profit made mistakes.

What’s specifically relevant in this case is that Goldman Sachs, one of the owners of this newly designated “minority bank,” has a history of discriminatory behavior. The firm's bigoted attitude toward Blacks and women is described, in great detail, by author by William D. Cohan in Money and Power: How Goldman Sachs Came to Rule the World, a book released in 2011.

Cohan recounts the case of James. E. Cofield, Jr, an African American Stanford MBA who sued Goldman for discrimination in 1972. On December 6, 1987, a female employee filed another in a series of discrimination lawsuits claiming Goldman had "a hostile working environment in which women were demeaned." In March, 2010, yet another female employee filed a discrimination lawsuit. In September, 2010, three female former employees filed a class action lawsuit stating that Goldman "systematically discriminates against women in pay and promotion." 

This discriminatory behaviour appears to be ongoing. On Sunday, June 2, 2013, an article on Salon.com described a “series of racist and sexist ‘tips’ to succeeding at” Goldman Sachs. (http://www.salon.com/2013/06/02/wall_street_insiders_advice_for_interns_sleep_with_your_female_colleagues_then_brag_about_it/)

Goldman also has a history of manipulating financial data in order to support unethical business activities designed to maximize short term profit. In 2003, Goldman Sachs admitted that it had violated anti-fraud laws. In 2010, according to the New York Times, Goldman paid “$550 million to settle federal claims that it misled investors.” (http://www.nytimes.com/2010/07/16/business/16goldman.html?_r=0)

As part of that settlement, the firm “agreed to a judicial order barring it from committing intentional fraud in the future.”  As an investor in an institution that has received designation as a minority depository institution without actually being one, some may suggest that Goldman has violated that order.

At any case, Urban Partnership Bank’s designation eliminates an honest and ethical explanation of the “Minority Depository Institution” designation. As an analyst who has been producing statistical reports on women and minority banks for 30 years, this change also affects my ability to derive meaningful insights from bank performance data pre definition change and after the MDI designation change. It makes any long term statistical analysis meaningless, as I noted in the Minority BankMonitor, our annual review of the social and financial performance of minority banks.

More importantly, this change removes any real social meaning from the MDI status designation.
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