In our efforts to bridge the great divide that is entrepreneurship and funding, we thought a trip to Miami to participate in Black Tech Weekend 2017 might shave a few miles off the expanse. My initial expectations as I walked through registration on opening night are best summed up with a little help from my friend Jerry McGuire.
Being my first foray into the world of startups and venture capital, my layperson impressions were understandable. Michael Seibel quickly extinguished that flame within the first few minutes of his presentation, proclaiming that 99% of all startups are destined for doom by virtue of their very existence (sic). As the CEO of venture fund Y Combinator, and co-founder of a little billion dollar company called Twitch – you may have heard of it – I was inclined to believe him. As he related anecdotes on his experience as an entrepreneur and venture capitalist, my occasional chuckles were soon replaced with a sinking feeling of despair and the sensation that I was waaaay out of my element. I fumbled around my 2 minute chat with him in the meet and greet that followed, mumbling something about MVPs (minimum viable products) and dissonance between startup partners, and headed back to my car the picture of dejection.
I took a breath, and shook that shit off. The thing that stuck with me the most that evening was a question he posed to would-be startup founders.
Why should I fear you?
It was a little less about intimidation, and more about regret; as an investor, the very notion of failing to get behind your project should give them nightmares at night. Coupled with maintaining the upper-hand and retaining as much leverage as possible in any dealings with VCs, the likelihood of funding increases exponentially.
I skipped the after-party and headed home to contemplate how I’d tackle Day 2, which really translated to what I’d be wearing. I figured the day would take care of itself.
I got to the Little Haiti Cultural Complex a little earlier (read “a lot”) than everyone else the next morning, but dismissed any thoughts of the event being on “coloured people time” as I sipped my first of 17 cups of coffee. Pro-tip: stay caffeinated. These all day events are gruelling, with short breaks and large heaping helpings of soul food to add to the mix. The morning session proved substantive, starting with Peter Walker of Spawn Labs providing invaluable insight on the necessary sacrifices and overcoming the struggles he encountered leaving the security blanket of his steady 9-5 and pooling all his efforts and resources into his venture. The main takeaways from his presentation focused on the importance of a strong support network during the transition, with mention of how his wife held it down for him during trying times drawing applause from the audience, as well as seeking validation of your idea and product from outside your circle, through surveys and market studies of your key constituents.
As the day progressed, each new black success story ate away at whatever despair I had felt the day before. Our perception of black success and black wealth is incredibly skewed; at last count, there were at least 110,000 black millionaires in the Unites States. Of this number, athletes and entertainers make up less than 10%. Representation beyond what the media and popular culture portrays is important, especially for fledgling black entrepreneurs seeking their own validation, and Black Tech Weekend quickly proved the perfect outlet for getting the word out. The idea of under / mis-representation isn’t lost on Kraas; it lies at the very crux of the problem we’re trying to solve.
Lauren Maillian, Venture Capitalist and Arturo Nunez, Apple Latin America Executive reiterated the need for articulating the response to the question “What problems are your startup solving?” later that afternoon. Other speakers shared the lesser known aspects of when the startup and VC worlds collide, culminating in what’s commonly known as the term sheet. Keeping your house in order is pivotal to successfully navigating the periods before, during and after getting an offer from a potential investor, ensuring all your legal and financial documents are current and in place. Winging it is simply not an option. Attendees were also introduced to convertible notes as a viable investment alternative, as well as the notion of “sweat equity”, which is often informally used in negotiations involving stakes in partnerships and compensation. This segued into the affirmation of actual employees being a better option than contractors, where intellectual property lines can often get blurred.
We were treated to an intimate case study of the relationships between investors and tech startup founders by the pair of Marlon Nichols (Venture Capitalist, Atom Factory) and Rodney Williams, Founder of LISNR, a communication protocol that sends data over audio, which he hopes will eventually replace Bluetooth as the defacto standard. Their interaction was for the most part cordial, but Rodney warned that investors are not your friends, something we’ll be absolutely mindful of in Kraas’ future dealings 😉
A wind-down / turn-up in Miami’s Wynwood art district concluded the day’s proceedings, where I had a chance to flap the wings of an otherwise very antisocial butterfly. Big up to the two Jamaicans I met and immediately bonded with, fellow entrepreneurs Chris Williams and Larren Peart (pictured below), both reminders of the tremendous pool of potential to be found in our relatively small Caribbean Sea.
First impressions of being immediately bankrolled aside, Black Tech Weekend 2017 proved to be insightful and memorable, and we must extend our heartfelt thanks to the organizers Felecia Hatcher and Derick Pearson for staging an event which should ultimately become a staple within the Black startup community.