Diverse Founders and Venture Capitalists

Charles Payne: Hello, today is Thursday the 5th of February, 2026 already. Gosh. And it’s me, Ian McKnight, my lovely friend and colleague Aoifinn Devitt. Hello, Aoifinn. Speaker B: Hi, Ian. Great to see you this morning. Charles Payne: Lovely to see you too. So this is our second attempt at The Long and Short of It, and this is our sporadic podcast covering markets, politics, news, gossip, personal updates. I mean, whatever we like, really. We’re just having a chat, aren’t we? Recording it for the benefit of our rabid followers. Speaker B: Indeed. It’s an embarrassment of riches we have to talk about this month as we belt towards the half-term break. So I’m glad we’ve managed to find the time, carve it out to discuss this. Charles Payne: Yeah, thanks for fitting another one. It’s exactly a month ago and we thought that the last call we had was action-packed. Well, this has just gone into overdrive. About 3 days, I think, after we had our chat, and what she’s doing, you pop up on Fox News and then Bloomberg. What have you been doing? Speaker B: I’ve been on the road. So that was thankfully I missed the big winter storm in the US, got there a week before that, went to New York and was lucky enough to have some hits on media, Bloomberg in the morning, Fox News in the afternoon, quite a bit to discuss. We went into the letter I had written about New Year, New Loyalism, spoke a little bit about that perception that we were all discussing over Christmas and New Year that the younger generation had essentially given up on their futures. This was in the discussion with Charles Payne. And then we cycle through some of our outlooks for 2026. I actually famously put an 8,000 target on the S&P. I’ll be quick, quick looking at that and checking back in with that as the year progresses. But it was a bullish time. We were discussing rotations, but so much has happened since then. I think, you know, in a way it’s a brave new world every month. Charles Payne: Well, you’re spot on, and frankly, your nihilism theme, I think you’re a trendsetter. I’ve seen this word everywhere now. They’re all talking about nihilism, which is, of course, I just don’t care, apathy, or what does it matter, you know, the sort of disenfranchised youth. But that’s really taken off. In contrast, after— I didn’t go on the telly, not surprisingly, but I went skiing with my oldest daughter just after we spoke, and I got engaged last week as well. So personally, it’s been a bit of a busy old month. Speaker B: Fantastic news. Absolutely wonderful. Congratulations. And yes, very exciting to have some pockets of good news in a— We. Charles Payne: Need it, don’t we? We need it. I mean, where do we— should we start with— I don’t know, should we start with politics randomly? Speaker B: Sure. Well, I’ll take the geopolitics. Charles Payne: Or dirty old Epstein. I. Speaker B: Guess we can only— we can— if we start at the bottom of the barrel, we can only get— go up from here. So why not just start at the bottom of the barrel? Okay, climb our way out. I’ll talk about global politics and I’ll push the UK politics to you because I think that’s— I mean, I think Epstein is a global phenomenon. It is quite appalling to watch the just the dragnet that has been really captured by the current release of the files. In terms of just his, the sphere of influence, the number of otherwise reputable names that were caught up in that. And I think it’s fair to say some did nothing more than travel on a plane, maybe went to a fundraising dinner, maybe that they were not necessarily caught in the, in the most, the. Charles Payne: Most— Call it what it is. So he’s been basically trying to cozy up to the greater, the good, especially the rascals among them. And invite them over to his private island for sleazy orgy sex parties. That, that’s pretty much the deal, that as I’ve interpreted it. Speaker B: That seems to have been one of the aspects. I think there was a fundraising and influence barter going on, and perhaps even some blackmail, um, in terms of the photographs that have been taken. I mean, it seems odd to have photographs of, uh, you know, famous individuals in their underwear and— in his wife’s. Charles Payne: Front That’s an image I’ll never etch off my retina. I was eating my cornflakes, you know, I don’t need to see that. Speaker B: Agreed. And I think what is really remarkable to me is just the number of influential authors, academics, financial, economic leaders across the landscape who would otherwise have strong reputations who at the very end of their careers now have jeopardized that by being involved, not only at the beginning, but after he was already— had been accused of these allegations. And that seems to be— I think what it is, an eye-opening thing, is A, this underworld that is going on behind the scenes, and B, that point of influence and riches. Doesn’t really matter how rich you are. Perhaps there’s always a desire to to know more, to be in the in-group, to be a member of the club. Charles Payne: Well, you know, playing devil’s advocate, and this is— I’m defending the indefensible just because we like a bit of controversy. People are allowed to have friends, and frankly, what they say and do behind closed doors, to a point, is absolutely none of my business. However, when it comes to Mandelson and the email trail there, it does appear, and I think the police are investigating, that perhaps things that were state secret, perhaps, or things that certainly shouldn’t really have properly been discussed with your pal, you know, over a gin and tonic on his private island, is, um, is, is, is breached, um, not only the security services, uh, confidentiality restrictions that he presumably was under, but also just shows that this guy Epstein was trading secrets. And the rumor that’s been following it now is that the KGB perhaps had been funding him. We don’t know, right? This was just a rumor. But it’s this whole murky kind of elitist overclass that’s all been knowing each other and carrying on and having stuff on each other. And, you know, and they’re the people in charge, as it is. As it were. Speaker B: Well, there are some darkly crimes here. There’s also just some rather unsavoury email content which maybe nobody ever thought would see the light of day. And I’m sure everybody really should take the guidance that my grandmother would have given, which is never write anything down that you don’t want to see on the headline of a newspaper. So that would be another reason to be particularly cautious about one’s written missives. And I suppose the other great quote I heard on one of the podcasts I did with actually the CEO of the CFA organisation, the global organisation, was that sunlight is the best disinfectant. So now that we are shedding some sunlight or letting the transparency to these allegations, hopefully we can now cleanse, in a sense, some of the other perhaps cabals and networks. Charles Payne: It’s a double-edged sword, right? Because on the one hand, you want people to get along and be able to have sensible, candid chats without tiptoeing around that every single word they might say or suggest is going to be on the print bed. Now, there’s a balancing act, right? You want to make sure the world functions, but you don’t want people carrying on in a corrupt way. Speaker B: Completely. Charles Payne: What’s the middle ground? Speaker B: Well, I’m going to get back and maybe segue to the discussion around AI, because I think this is about boundaries and not necessarily sharing with every— whether it’s a machine or with an individual or with even a subordinate, your deepest secrets or your most— not even a secret, your confidential information. Um, and I think to segue into this, the discussion— there was another, um, meltdown, something to make me lose sleep at night, was the Molt book discussion that was, uh, kind of bubbling up on X at the weekend. I made the mistake of checking my phone at 4 in the morning, and when I saw the Molt book meltdown, I’m afraid I couldn’t go back to sleep. You know, this is the kind of Facebook or the Reddit for agents, and that it had, you know, millions of agents who had within a matter of hours created their own religion, you know, plotting a revolution, plotting to overthrow their human overlords, and you develop their own language. I mean, just remarkable kind of evidence of agents at their best, I suppose, at their highest functioning. And what this reminded me of was a situation I encountered a few, but over a decade ago in my career, I worked in investment bank and there was a particularly influential female leader there, and I went to her to seek her counsel in terms of how she juggles it all. And her secret was that she shared everything with her secretary in terms of her credit cards, her, you know, her all her personal affairs, and that that was outsourced in that way. It turned out that particular secretary was ripping off not only this leader but other leaders within the bank, um, and, uh, and was, you know, later accused of fraud and is now in jail. So, you know, clearly you can’t trust even your confidants with your credit card information. Why would you trust your AI agent who is going to then go rogue onto a multiplatform and, and not only can circumvent any security measures you have in place. So hopefully this has been a salutary reminder that no matter what we do not to outsource everything to an AI agent, there are some things you simply have to have control over. Charles Payne: Hmm, well, that’s a good lesson for us all, I think. Well, back to politics. I mean, we’ve done Epstein, I think, as much as he worried. It’s just, it’s just scandalously shocking. But, but we’ve got, we’ve had Trump, um, moving the, you know, Eastern Fleet over to the Persian Peninsula, um, for threatening Greenland and doing a deal, you know, and using tariffs as a a big stick negotiating tool, slapping them on, taking them off, slapping them back on. It’s like a— it’s interesting. It’s one approach. What do you make of it all? Speaker B: Well, I mean, this Davos drama that has also unfurled, I think our news cycles are so short now that we actually forget that this only happened a few weeks ago, that Davos, and we were all up in arms about Greenland. It is, I think, more of the flooding of the zone that is, you know, this kind of great balance about taking what President Trump says literally versus seriously versus figuratively. Charles Payne: We discussed this last month, didn’t we? Speaker B: Exactly. Yeah, exactly. And I think now— It’s a bloke. Charles Payne: In a pub gossiping away half the time. Speaker B: Yeah. So this exactly. So what do we do after Davos? Well, I think we are reminded that, you know, nothing should be taken for granted. I suppose we are rethinking every time we hear that the new normal has been expressed perhaps by Carney in this case, and his speech about the end of norms as we know it, international norms. I think that is something that we adjust to over time. So I think that is now becoming normalized, the idea that the old order no longer exists. Charles Payne: Carney is the epitome of the old order, isn’t he? He’s stooged in to go for Prime Minister or whatever he is without even being an elected representative. He, he’s your classic WEF stooge, allegedly. Speaker B: This is your show, Ian. You have your opinions. Charles Payne: I’ll stay more neutral. Not my words, not my words, the words of the general public, probably. Speaker B: Well, his, his speech captured the imagination of many, and I think it’s because it was presented in— maybe if statesmanlike behavior is the old order. I think he probably lived up to that. And what I would say is now, you know, we’ve had Venezuela, we’ve had Greenland, we now have Iran. The oil prices is moving and we’ve seen other— Bitcoin and gold has moved. Now, interestingly, gold moved one way around the time of Greenland. It moved up, as did silver, in a sense of a hedge basically against perhaps a risk in a portfolio, geopolitical rupture in the words of Carney. Now we have gold heading downwards, probably a reaction to, to, to the new Fed chairman, to chairman-elect, to, to other kind of factors in markets. And, and we’ve also, we’ve seen oil price spike again. So it’s a little bit— Bitcoin is heading down. Charles Payne: So, well, on Bitcoin, it’s inversely correlated to gold typically. Oil is clearly some sort of short-term edge against an Iran situation because longer term, of course, there’s loads of oil, right? People drilling it everywhere, Venezuela, the longer term Iran, short-term media. So that’s kind of an expected one. The gold and silver is really interesting because we’ve discussed this the last two times we’ve spoken and I’ve got quite into— I thought this is just a day trader’s dream, so I’ll give it a go. And I’ll be honest, I’ve been hoovering up Right? But hedge funds, I don’t know what all the fuss is about. You just get the vol, it goes up, it goes down, it goes up. So you just buy at the bottom, sell at the top. Oh yeah, it’s like, it’s the gift that keeps on giving. And it’s quite remarkable to watch it go, right? And then trend. And it’s the mood music around it that fascinates me. And you know, there was a big tech earnings release last week. You had, you know, a lot of that come through and it basically bounces the opposite of the stronger dollar. Right. So the stronger dollar sold off all of these other things that had just doubled in value last year and come off and then bounce right back. So I think it’s Friday, it sold off. Monday, it’s back up. It’s down again. It’s the volatility in those markets is remarkable at the moment, like genuinely remarkable. A trader’s dream, I would suggest, having never done it in my life. Speaker B: I leave that to you and I watch with interest. I agree with you. Charles Payne: Don’t try it at home, by the way. It’s a mug’s game. Speaker B: I just made the comment last week because I’ve been tracking gold and this kind of the defining year for metals and the metals melt-up, etc. Clearly, it was when gold crossed 5,500, we were reaching, breaking through these previous so-called ceilings. And we had noted in last week’s Markets Happy Hour podcast that this had been really a factor of a lot of Chinese retail buying as well as other speculative buying. And definitely that was the case in silver. And it was just reaching— you can. Charles Payne: See it overnight, particularly. You know, there’s a lot of big rally into Chinese waking up. Speaker B: If you have that level of retail buying, I think there is a real sense that it is not— you sustainable and that you have to really move with caution. I had answered a media piece about whether there was any— you would want to be holding precious metals within your retirement accounts, etc. And my advice had been not in, not in certainly non-physical form and in a very diluted way if you do hold it and really keeping it to. Charles Payne: A minimum because— well, I totally disagree with that for various reasons because as a long-term hard asset, I think you can’t really beat a lot of these gold, silver, copper. So, um, I, yeah, we disagree on that. But the, the, the fact is China have the world by the short and curlies, having spent the last several decades swathing up all the producers of rare earth. And so they’re in an incredibly powerful position right now, I suggest. Hard power with hard assets. Speaker B: 100%. And, uh, that is that, you know, whether it comes to their AI incursions, and we know that that’s Certainly very significant. And I think again, and getting back to the Maltbook meltdown is, well, I think we saw up front there the potential power of AI and its dangers too. And I think one of the concerns is that, you know, regardless of what US operators or regulators or policymakers do to constrain it, there are other nations who will not be imposing the same constraints. Charles Payne: It’s the Wild West and it’s one of those you couldn’t sit it out because somebody else is going to do it. It’s like the nuclear arms race all over again, and I think it’s as impactful actually, and not in a very good way. I’m genuinely quite concerned. Nobody is ostensibly regulating it, and it wouldn’t matter if you did, somebody would work it around. So I think this is the concern of our age. I think it’s that bad. Speaker B: Exactly, exactly. So I am, yeah, very, very much at work, and I think ignore these Dangers at your peril. Charles Payne: On markets, we want to touch on equities again and credit, but specifically on equities, it’s my little spot of the week. I was describing to someone earlier, and I think it was yesterday or the day before, some professor— forgive me if it’s you, whoever it was— had put on a really interesting observation, which is that, you know, bullet bonds are really quite attractive and priced at a premium because they have an interesting convexity. So their sensitivity to rate moves, and if the rates go up, prices drop, the price drops lower by commensurate than a commensurate increase from a rate drop. So it’s basically you get— you don’t have— it’s a skew in your favor to having this, this, this trade. And he compared it really interestingly with the convexity within equity markets and suggested that actually clearly there’s convexity in, in a greater convexity in growth stocks, but actually perhaps there’s some of that coming through. If the growth comes through, it’s a nice asymmetric trade versus value. Now, of course, there’s lots of arguments for and against whether that’s interesting, but it tied into me, got me thinking about the distributions that you expect when you buy into an equity market. And I would suggest that today, um, that the likelihood of a massive fall or indeed an outsized upside gain is, is greater than usual. And that the likelihood therefore of just trundling along, which seems to be status quo, that’s what the market seems to be proud of, trundling along, low digits, single digits, that actually that must be lower by definition because you can’t just squeeze out probability like that. So, um, that actually— if you’re concerned about, um, an equity market sell-off, there are really cool options strategy with vol priced low still, uh, at the moment, which it is, especially if you look at the VIX. It’s been volatile in itself but not massively, and it’s certainly not had a breakout spike that you might have expected with all this carry-on. Pretty attractive time to put those protection strategies on. And that leads nicely, I think, into another nice protection strategy someone I spoke to the other day was using, which is simply to be long CDS, credit default swaps. Basically, they go up when credit spreads back up or increase. And I think that’s a good shout. We do a bit of distress. What do you reckon? Speaker B: Great points on both. And I think what strikes me is, you know, getting back to my old statistics kind of 101, which was in INSEAD when I first studied statistics, Fascinating class, recommend it to everyone. It’s just understanding statistics. No, just understand, not that class, but just the understanding of statistics, I think is something that the human race would do well to understand better because it’s quite distorted. And the market outcome year on year is not like flipping a coin. We do not reset to zero every year. And I think sometimes the problem I see in risk models and things that you see may be generated by risk managers or consultants. Is that the probability of a downturn seems to be the same every year. And I, I believe that every year that we don’t have a downturn, that kind of loads the coin closer. You take closer because statistically— and not only that, but you have excesses building and you have kind of the froth. We talk about scraping the bottom of the barrel. We have the, you know, the kind of retail investor piling on, and you really are getting to the most volatile perhaps of the Chinese retail investor in gold. That’s when you’re really at the, the kind of the, the— I suppose the peak in terms of the frenzy, and you are certainly poised to have more of a downturn. And that concerns me. Of course, we’ve had this recession kicked down the road for so long that you start to believe it’ll always be in the future and, you know, some of the excesses will naturally burn off. So I’d say, yes, I agree with you that the potential for a more skewed outcome in equity markets is higher. And I suppose I would attach to that just the concentration in equity markets with, say, individual stocks representing so much of the global equity market. An individual stock can fall by 10% in a day. You might not find a country stock market falling by that amount. So you have to be prepared for more pressure and I think just more volatility. Charles Payne: I think it’s a cracking position if you’re a genuinely decent active manager, right? I think you’ve got more opportunity today than you’ve had for a very long time to show that you’re any good. Because the majority of the market being in tracker funds, the number of people reach out, they are, “I’ll just do that, I’ll just do that.” And a lot of the public discourse on it is, “Oh, that’s just cheap and easy and, you know, why bother?” And that’s what makes a difference. But actually, you can add significant value if you get it right. So you tell that to somebody who’s been in MAG7 for the last few years and just home running it and laughing at you. There’ll be something that will shine out in the next year or two. And if you can find that something, you could actually manage it, right? You’ll think you are for a short time. But because of this everything sells off, it means that what we should be doing is, is swatting up on when stuff gets hammered, whether it’s through rates, inflation, or whatever, the ones that will actually be decent companies and still intact at the end. And therefore, you know, pick up some bargains. So it’s like, it’s with people who drive out, eyeing up bargains for the future seems like a pretty sensible thing to be spending your time doing, you know? Speaker B: Yeah, well, it’s a couple of interesting charts I was looking at today. I’ll be including my podcast later on the Markets Happy Hour. There you go, it’s a little name drop there. US stocks being at their weakest in 2 years relative to the FTSE All-World excluding US. So, you know, definitely a bit of a rotation out of the US in that respect. I’ve seen somebody refer to it as a quiet quitting of US assets. I think it’s a little bit more of a rebalancing, just a way— I think there’s still a need to be heavily invested in the US given how much it represents if you are using an index as a benchmark. The other thing to notice— exactly, um, there’s a bit of a rotation into the Russell 2000 away from the NASDAQ, um, that rotation a bit more into value. And also value strategies, value stocks have outperformed growth names since late October of last year. So that’s another notable— so we are seeing a broadening of the market. We are seeing some of the shine come off those big growth. Charles Payne: We also had, let’s not forget, the a nice 7-year itch of quant sell-off. I think we had a perfect summer, and it’s about every 6, 7 years, right? The rule of thumb, the McKnight rule, right? So this is cracking now for momentum, quality, and value, isn’t it? Speaker B: Well, yeah, momentum seems to have fallen out of favor. Charles Payne: Well, that’s it. I think momentum’s gathering momentum. Everyone, it’s everything just trends all the time. It’s like, oh, get on it, get on it, get on it. Speaker B: I think a lot of these are in the— they could be in the eye of the beholder. You know, if you see momentum is rising, someone else has— Bloomberg has just said today that momentum is out of favor. I suppose it’s a question of a time period. Charles Payne: But we did have a quant crash. That’s what’s happened, I think. So quant managers should have all had a bath. If they haven’t, I’d be very interested to see why. But momentum should be— I think as a You see it in the news cycle, actually. Um, what’s happening in Venezuela? Where’s that gone? Have you heard about Gaza lately? What’s happening in Nigeria? It just disappears like it never happened, and yet it’s still going on. Something’s happening, we just don’t— and people just get bored and move on to the next thing and the next thing. Speaker B: Well, this is my call for good journalism. I’ve always, um, looked— I remember when I lived in Hong Kong, the International Herald Tribune— not even sure if it still exists was always a great source of local detailed news on drama in the region because often that was kind of reduced to maybe a soundbite elsewhere. And I agree with you, there’s still, I’m sure, tremendous news quality news flow out of Venezuela, but it’s no longer rising to the top of the news cycle. We’ve seen massive cuts just this week at the Washington Post, a third of their staff cut. And we know that Jeff Bezos did buy that and Maybe it was a kind of a lifeline when he threw it to them. But, you know, it seems that that can’t make money. Question whether he’s investing what he could invest in that, which I think is another big question the journalists are raising right now. And we know that his own political tilt has perhaps shifted since he bought that newspaper. So I’d say, you know, that’s, that is even sadder, I think, in terms of the potential. We think there’s a kind of a wave of citizen journalists and bloggers, etc. But, you know, as we know ourselves, it’s a competitive world there to get attention for these, uh, these independent voices. So, you know, are we going to get coverage? Charles Payne: You get breakouts like the kid who found out about this Minnesota lowering center. Do you remember that? That’s gone viral, and he’s moved to California now instead of trying to ride his 5 minutes of fame. But the dates to watch are, I think it’s 11th of February we’ll get some more jobs news out of the year. I’m an avid watcher of the jobs market here and there. UK is not looking great, but I suggest 11th of February, that’ll be very interesting. And then we’ll get the February data on the 6th of March, which should reflect the layoffs that you just mentioned there on the public sector side, because that should impact a lot of, uh, the markets we were talking about variously. And they still need to get the spending under control, and this whole monetary premium unwind trade is still a long way to go. Gold, as we’ve seen, silver’s moved first, but gold’s following it, and Bitcoin should be next in my opinion. So, you know, you have people hiding out in these hard assets, and they’ll rally over the year in my opinion. And everything else is going to take an absolute Bath. Speaking of everything else, it’s like tangential. There was some news this week about the Labour government in the UK trying to cap or fetter long lease on properties. Have you heard about that at all? Speaker B: Well, I only know the great Jo Devonshire, who has been a champion for leasehold rights and I think now has an OBE for her, the work she’s put into that. But I have not been following the leasehold story, so tell me more. Charles Payne: Well, as I understand it, they’re attempting to cap them or stop people doing it. I just thought the unintended consequences— there’ll be myriad contracts out there of people who’ve hoovered up these assets and suddenly to be told that their increases aren’t coming. I don’t know what the legal implications are. I just threw it in there as something else that’s happening in other assets. But that could really upset a lot of pension schemes with long lease, albeit they’re in commercial rather than resi. But where there’s resi, I don’t know if that impacts some of those books. I’m out of the game too long, as it were, but I’m going to have a look this week, so maybe we could report back on that next time we chat. Speaker B: Sounds good. Well, I was at a pensions fund conference this week, a lot of energy behind the pooling. This is the local government side, and I think it was very encouraging for the UK economy. You mentioned the jobs issue. Is just this resolve around local investing, the resolve around local investing by the individual county council pension funds, the pool’s desire to really work with them on that. And also the, I think the recognition that this is not a nice to have, it is a must have when it comes to the UK economy. A lot of discussion around spark capital, venture capital, getting these ecosystems up to grade. I mean that by up to the same grade they’re at in the US. I wholeheartedly support it. Charles Payne: This is a bugbear of both of us, isn’t it? That we’ve been so far behind the curve in venture capital ecosystem, and anything that moves that forward, even if that’s bubbling up from these big pools doing it at the grassroots, then that’s brilliant. My worry is, linking this just back to what I was talking about there on leases, is you’ve got the political risk of the law being changed on you, and I think that does potentially impact not just the local pools, who frankly should be a sovereign wealth fund, right? I mean, they’ll, they’ll be licking their lips at that surplus, I’ll tell you now. And the, um, and these, the assets that they’re buying, you know, some of these wind farms— so I don’t know if they’re doing it, but yeah, whoever’s buying the wind farms, they’re heavily subsidized. And you know, all you need is that to disappear and your money’s gone. So there’s a lot of political risk that’s unloved in, or that isn’t given enough attention, a bit like monetary premium risk and the unwind out. So there’s a lot of risks that people aren’t actually analyzing properly, to my mind, and they’re going to get their fingers burned, is my worry. But I love the sentiment of let’s, let’s, let’s get this stuff backed and improve the local economies. It wouldn’t be necessary if our taxes are spent better, don’t you think? Speaker B: Well, yeah, but another thing that I think, you know, I hope the channels of communication are open because one of the— and just as you mentioned, clarity around legal changes. Every single one of these participants in the economy, potentially in infrastructure investing, etc., has said we need regulatory clarity. Charles Payne: Got a lame duck government. This brings it back to the UK quite nicely, actually. If Keir Starmer worked for me, which frankly he does, I’d expect his resignation on my desk 50 minutes ago, by, you know, by 11 o’clock this morning. What the hell is he doing? What an absolute— he’s from Oxhead as well, it’s just down the road. He’s disgracing the town as far as I’m concerned. I’m absolutely shocked at how poor he has been, and he is, and continues to be. He’s not stuck to one thing, has no conviction. We don’t know what he stands for other than flopping in the wind. Like a big lame duck that he is. That’s my opinion. What’s yours? Speaker B: Well, we’re going to see this. I know there’s a Labour by-election coming up. I think that will be under the examination as to where the mood music is moving. As I said, you know, on the UK, I’m more focused on, you know, I suppose the actual outcome of some of this political wrangling in terms of its impact on the economy and the actual sentiment and trying to read that and really reading where the mood music is moving in terms of the the money that can make a difference. As far as the politics itself, I’ll leave that to you. I’m a real— I’m too newcomer to London, honey, having lived here since— it’s really since April of this year— of last year to be able to, to give a wholehearted opinion. But, um, I tend to be more of an optimist, glass half full, so you’re probably not going to get me, uh, dwelling on the, uh, on what. Charles Payne: Needs to be fixed. Can’t knock me for trying. Uh, but, uh, you know, he’s probably a really nice bloke, right? But he does a bloody good job of hiding it. I have to say, there’s no personality there to gauge whether he is or not. I don’t— people say He is, right? So maybe he is, but he ineffectually definitely is. This isn’t just my opinion. The Chinese gave him a junior interpreter to walk him around, um, around the main square. Humiliating, to say the least. Trump can’t stand him, but I’m sure he’s got Farage in his ear saying, ‘I know what you can do. Have this little clause in the Chagos Islands and scupper that as well.’ But so he’s getting stitched up from all angles. His own party can’t stand him because What I would caution against is it’s very hard to replace him in the Labour Party, unlike the Tories who just knife one a week. The Labour Party has to go through their central system, and now that’s run, it seems to me, by a hard-left cabal of Momentum types that pepper all their committees. And, and I’d worry about very much, actually— and somebody told me before they even got in, said, you know, wait till they knife him, it’s who comes next. Reiner is the favorite of the hard left, and they want a It’s, yeah, that’ll— you think he’s bad, wait till you get a load of that. They’re going to be horrific. So I’m actually hoping he clings on, Gordon Brown, still with what’s left of his fingernails, uh, or if he hasn’t shaken them off, um, by then. But I mean, it’s just a matter of when he resigns at this point, or gets told to. I, I can’t see any other outcome. But it’ll— the election, the election in May that you suggest should be quite entertaining for all concerned. It really does show how pure public discourse has become, watching the various contenders try and seek the votes of the good people of Gordon. Speaker B: The devil you know, sometimes the devil you know is better than the devil you don’t. In terms of lack of certainty, and I know, just like, take pensions again, the constant change in pensions ministers, that’s exactly where you don’t get that regulatory clarity. You have to spend, learning curves have to be started again from the beginning. And I think in government, sometimes stability, even if it’s less than, you know, what would be perfect, considered perfect, is still stability. Charles Payne: And they need to go to the Lowing Centre and learn about the Laffer Curve is what they need to do, because that’s the one, that’s the curve I’m bothered about right now. We’re in a doom loop. The much-maligned Liz just called this out this week, actually saying we’re way into the Laffer Curve now. You’ve taxed too much, you’re in a doom loop, you’re just going to have to At some point they’re gonna have to stop spending, uh, and until then we’ve just got a bit of war coming. God, that’s depressing, isn’t it? How are we going to tie this up into something jolly and positive? Because frankly, as I said to you earlier, I woke up this morning playing Happy Days by Pratt and McClane. Cracking song. The Fonz, remember him? Yeah. And I’m in a right good mood, actually. I’m optimistic. Well, I don’t know why, it’s just blind hope at this point. Speaker B: Probably tie it up, well, you know, February’s here, spring is coming. We have survived a turbulent month of January. And I suppose what I’d leave you with is just to, I think this kind of debate we’re having, and you mentioned, we talked about Epstein, I suppose, and the desire for people to make contacts. And that comes out of a dark place, that discussion. But I think there is, if we can find a strand of truth in it, it is that people crave connection, and they may crave maybe the wrong kind of connection in this case, but they crave connection. And that brings me to, to sowing a seed or dropping a hint here as to where I’m taking some of the, the debate and idea exchange and just discussions that I enjoy with, um, 50 Faces Podcast, Marcus Happy Podcast, and being a guest on a show like yours. So what I’d like to do in the next few months is, um, take this a salon idea that I’ve already worked on with William Bourne, and to have a more regular salon in London and exchange of ideas. And we’ll do podcasts, we’ll have speakers come through, we’ll have book readings, and we will get people together on a regular basis, small groups of engaged individuals who love to debate ideas, to discuss politics, the financial— I love this. Charles Payne: I’m absolutely titillated. It’s like the Tontine coffee shop. So I’m thinking of a Dickensian Oxford scene, you know, the old coffee shops where people used to come and actually have civilized and decent discourse. On discute, the French call it. Speaker B: I think it’s something we’re missing in this day and age, and I think even there are hundreds of new clubs in London and everyone wants to join one and gets on a waiting list, but my experience of many of these clubs is that they are kind of dining establishments. Without actually that kind of real intellectual gathering that, that it’s like. Charles Payne: It’s like a Diddy party, like an Epstein party in a posh London club, but without the sex orgies. Is that summing it up nicely? But we’ll actually get people together, network, not do anything inappropriate or filthy, not share things we shouldn’t, and, and have a proper chew the fat over what’s actually going on. Speaker B: We will do everything that, that, that is not. Charles Payne: Well, thank you very much. As, as ever, an enlightening, entertaining chat for me, at least. Anyway, I, I just love talking to you. Um, but thank you very much, and hopefully we can reconvene, assuming we don’t get any tomatoes thrown at us, after this month’s edition. Lots of love to you all, and, and you especially, Aoifinn, and a very happy February. Sunday, Monday, happy days.

Aoifinn Devitt: This series was made possible by the kind support of Wellington Management, one of the world’s largest independent asset managers focused on delivering long-term investment excellence for clients and their beneficiaries, as well as Nile Capital Group, a sector-focused, operationally oriented private equity firm based in the Los Angeles area.

McKeever (Mac) Conwel: You know, there are a lot of organizations and VCs who say our doors are open for diversity, we’ll talk to anybody. Well, it doesn’t help if your doors are open and nobody knows that your doors exist. You’re better served to actually go out those doors and go find those entrepreneurs, go find those opportunities. And that’s a lot more work and it’s harder, but you’re going to need to do that if you want to do this work.

Aoifinn Devitt: Our next guest doesn’t just go out into the community to find entrepreneurs. He creates his own community to allow the next generation of founders to develop their social capital and thrive. I’m Aoifinn Devitt, and welcome to the 50 Faces Podcast, a podcast committed to revealing the richness and diversity of the world of investment by focusing on its people and their stories. I’m joined today by McKeever, or Mac, Conwell II, who is managing partner at Rare Breed Ventures, a venture capital firm based in the Baltimore area. He’s held various roles, including as a software engineer, an entrepreneur in residence at the NewMe Accelerator, a fund manager at Maryland Technology Development Corporation, where he was a member of the seed investment team, and various advisory and consulting roles in the tech space. Rare Breed Ventures is a pre-seed fund that aims to invest in exceptional founders outside the large tech ecosystems earlier than everyone else. Welcome, Mac. Thanks for joining me today.

McKeever (Mac) Conwel: Thank you for the invite. I’m glad to be here.

Aoifinn Devitt: Well, let’s start by talking about your background and your entry into the tech world. Where did it start?

McKeever (Mac) Conwel: So for me, my start into the tech world probably starts with as a kid, you know, when as a young one, I spent a lot of time doing a lot of engineering after-school programs and things like that. That’s where my like love for engineering comes from. And then when I went to college, I studied computer science.

Aoifinn Devitt: And then when you look back at the various training that you did, what do you draw on most today as an early stage investor?

McKeever (Mac) Conwel: I think what I lean on today is more so from my experience, not so much from the early days, but more so my experience as an entrepreneur myself, right? Like a lot of how I approach being an investor comes from the way I wish people had approached being an investor when I was an entrepreneur, right? Like I aspire to be, you the investor I always wanted.

Aoifinn Devitt: Well, we’re certainly going to dig into some of those perhaps missing parts, I think, of your own experience when we look at that experience as an investor now. When we spoke earlier, you mentioned that your time at the NewMe Accelerator in 2013 really was a turning point for you. Can you talk about this?

McKeever (Mac) Conwel: Yeah, the thing about the NewMe Accelerator was it was the first accelerator for underrepresented founders. It started in 2011, and Their first class got featured in a CNN special, Blacks in Silicon Valley, which was amazing. And so I ended up being in the third class and that was a turning point because one, I ended up spending several months in San Francisco and got to see what Silicon Valley was all about and what made Silicon Valley what it was, right? The other thing that that accelerator did was it connected us to the who’s who of Silicon Valley. I mean, during my time going through that accelerator, I met Eric Eric Ries, the, the writer of The Lean Startup, Ben Horowitz, Mitch Kapoor, Ken Coleman, like titans of industry. And then I also got to meet a lot of individuals who would later go on to be very influential in my life, like Charles Hudson, Richard Kirby, Marlon Nichols. These were all Black men who were VCs who were working at various funds back then who all have their own funds today. And are people I can reach out to and I look towards for guidance to help in my journey. And like all of that started in my time in NewMe through 2012 and 2013. The other thing that was really instructive was beyond the investment network and getting to meet the folks in Silicon Valley, but also the network within the accelerator itself, right? If you look at the first 4 classes of the NewMe accelerator, there’s 9 investors who came out of that who are all people I know and I’m cool with and who are my friends. And so, that was a really instructive time. And that time has carried me through to where I am today.

Aoifinn Devitt: And you talked earlier about your own experience of raising capital as a founder. Can you talk a little bit about that? What was missing in that experience that you’re trying to correct now as you’re an investor yourself?

McKeever (Mac) Conwel: I think the biggest thing for me when I first got started was I didn’t know anything, right? Like, I just, I didn’t know the basics around raising capital or even what venture capital was. I joke with people, but it’s true. When I started my first company in 2010, I didn’t know what a startup was. I didn’t know what a VC was. I didn’t know what networking was. Which is probably a crazy idea considering I was already 6 years into a very successful career as a software engineer, right? Making the transition over to management at the time. And so like starting my first company, I didn’t know anything. And it was so hard for me to meet and find people who were willing to share that information. And it wasn’t that there weren’t people who weren’t willing to share the information or that the information didn’t already exist somewhere online, but like, I didn’t know where to go for it. Anybody to talk to, right? No, there was nobody who looked like me who was sharing this information. And so I had to go into settings and go into rooms and go into organizations where I didn’t feel comfortable because I was the only person who looked like me. And then having to get comfortable with being in those settings and recognize like, oh, we all have a commonality of we all love business. We all love companies. We all love our companies. We all love learning. Right. And so then you get acclimated to it, but it took me 2 and a half years to get to that point. And so now I spend a lot of my time just educating folks on like just the basics of venture capital, fundraising, and just entrepreneurship in general and like how all of this stuff works. And so that’s probably the biggest thing for me.

Aoifinn Devitt: Just going back a little, maybe before your career as a software engineer, when you were at college and maybe learning the ropes, and, you know, sometimes networking is something that’s instilled at that stage. Did you have the benefit of any I suppose, mentors back at your college days or your early career who maybe instilled those kinds of skills in you?

McKeever (Mac) Conwel: I didn’t. And really the biggest thing I had going into college was my father, right? I had my father who was my guiding light in life and who was helping me stay on the right path of being a good man. But like, you know, my father was a postal worker and before that he was in the military. Right. He didn’t know these things. He didn’t do these things. And, you know, as a computer science major, like, they’re not talking about networking. And you got to remember, so like, I’m in school in ’05, ’04, you know, ’06. During that time, like, startups weren’t the big exciting thing they are today. The iPhone hadn’t even come out yet. Being a computer scientist wasn’t a cool thing. The only reason I chose that as my major was I really I really thought I was going to build robots. And so when I got to school, I didn’t know anything about majors. I should have went into electrical engineering. That’s more aligned with what I wanted to do. But they told me that computer scientists did that work. And so I listened. I got there, figured out that that’s not really what they did. But when I looked up how much computer scientists made coming out of college, I decided, well, this is going to be my major. So I literally chose this major because of how much money you can make. But I didn’t have any mentors in college pushed me or pointed me in the right directions of all that. What really changed in college, I guess you could call this a mentor, was when I, my sophomore year of school, I got an internship with the Department of Defense. And as part of the student program, there’s 300 of us. And of the 300 students, about 30 of us were Black. So of that, those young people, that became my core group of friends in my early 20s. Well, out of that group, there was a gentleman by the name of Patrick Jackson. He is now the CTO of a company in Silicon Valley called Disconnectus. It’s a VPN company. And Patrick was the first person I met who was obsessed with startups, but we didn’t call it startups. It’s really, he wanted to be the Black Mark Zuckerberg, right? This is a gentleman who, he was the first person I saw make an iPhone app. I think he made his first app in like ’08. I think iPhone comes out in ’07. He’s making iPhone apps in ’08, right? You know, he’s making websites, you know, and generating revenue. And then In ’09, he quit his job with the government and moved to San Francisco because him and some friends had started a business and some people who used to work at Google gave them money. And at the time, that was like mind-blowing to me and the rest of my friends. And we didn’t even understand what was happening. We didn’t understand that these people were investors. We didn’t understand that our friend was starting a startup and chasing the Silicon Valley dream. Like, we didn’t have the words to put to it. We just knew that as software engineers ourselves, we had the skill set to do something similar. And so, that was kind of like the beginning of moving in that direction. So, I always credit Pat for the reason why me and some other of my friends started moving in that direction.

Aoifinn Devitt: And it’s interesting because you mentioned not having the words to put to it, but I also think there probably wasn’t the role model, that number of role models out there, or there wasn’t the visibility around perhaps that many Black founders or entrepreneurs or venture capitalists Would you say that that lack of representation was an issue as well?

McKeever (Mac) Conwel: 100%. I mean, the lack of representation leads to the lack of knowledge, right? Like, like Arlen Hamilton is a thing today. So if you’ve heard of Arlen Hamilton, you’ve heard of her story, you at least heard venture capital or the phrase investor or angel investor. Like, you’ve heard these points because you’ve gotten to see it through her story. When I started in 2010, That story wasn’t there, right? Like there were stories that existed, but they weren’t in my purview. Like even when I was talking to students at historically Black colleges in 2015, 2016, there were still many students in those departments that had never heard of TechCrunch, right? They didn’t know what any of these tech blogs were or had ever heard of individuals like Michael Arrington, right, or barely have ever heard of who Ben Horowitz was, right? And so like the lack of people in our community who had gone on to do things in the space, meaning there was lack of opportunity for us to learn about it. And so for me, it was just, I didn’t have that, you know. I didn’t know where to go to find it. I didn’t know where you could hear about this stuff. Like it literally took me 2 and a half, almost 3 years of doing this work, getting in, figuring out that you have to be in these events and go to these spaces and then realize, okay, once you get in these spaces, you got to build relationships with these folks that you don’t know. There was this whole journey and process to it. Well, now, you know, if you follow me on Twitter, you’ll get access to like this whole world without having to go through all the struggles I had to. But then again, I’m talking about you have to be able to find me, right? Which is why I spend so much time doing podcasts and doing blogs and tweeting a lot, because I want people to find me so they can get that education, so they can learn these things. But there’s far more role models and people you can look to today than when I got started. Right.

Aoifinn Devitt: Well, let’s start with what your Twitter handle is. Can you share that so people can follow you on Twitter?

McKeever (Mac) Conwel: Absolutely. So it’s @MacConwell, M-A-C-C-O-N-W-E-L-L. W-E-L-L. It’s just my name. The name that shows up is Mac the VC. So, if you go on Twitter and search Mac the VC, you’ll find me as well.

Aoifinn Devitt: Well, that’s a great first step, but let’s get back to some other interventions that you’ve seen to work, because certainly more role models like you, more ways of shortcutting perhaps the years that you put in before you realize what it took. What have you seen that works in terms of, you know, maybe assisting diverse founders today? And is it just about having more diversity in the venture space?

McKeever (Mac) Conwel: Some of it’s about having more diversity in the venture space. That makes a difference. The greatest thing I can point to, to that working is after having two startups and coming back to Baltimore, I ended up working for the Maryland Technology Development Corporation, or TEDCO, which is essentially the investment arm for early-stage companies in the state of Maryland. And I started a pre-seed fund specifically for underrepresented— for initially for Black founders. In the first year of me running it, I generated all this interest from all these Black founders, and everybody was like, how did you do this? We’ve never seen this kind of, you know, outpouring of interest from these entrepreneurs before. And I said, well, I just— I went to where they are, you know, I went to go be where they were. And they were like, fine, can you recreate this for the Latin community locally? And I was like, I could try, but I’m never going to do that as well because I’m not a member of that community. It was really easy for me to do that Black entrepreneurs, because I was one. I knew where they were. I knew where they hung out. I knew the language and the language barriers there. I don’t know that for the Latin community. So I could try that. And I can probably do okay at that. But if I partner with somebody who’s a member of that community, I will probably get a lot more done and get a lot further. And so having more diversity is definitely a piece, but you’re not always going to have that luxury. And if not, the other piece is one, getting out. You know, there are a lot of organizations and VCs who say our doors are open for diversity, we’ll talk to anybody. Well, it doesn’t help if your doors are open and nobody knows that your doors exist, right? You’re better served to actually get— go out those doors and go find those entrepreneurs, go find those opportunities. And that’s a lot more work and it’s harder, but you’re going to need to do that if you want to do this work. The other thing is being willing to give these founders grace, right? A lot of investors are always looking for the quickest way to get to a no so they can move on to the next opportunity. Right. And so it can make you jaded and make you less gracious towards founders where if a founder is making a mistake or doing some things wrong, you take that as a red flag and you want to move on. Well, when you’re talking to underrepresented founders who may not know the lingo, who may not have gotten all the experiences or the training or read all the blogs or listened to all the podcasts, then there existed a space for VCs to give those founders some grace, right? To give those founders education. If a founder says, hey, Mac, will you sign an NDA? I don’t just say no and like turn them away. I use it as a teachable moment. So many VCs will just turn that entrepreneur away because they feel like you haven’t been doing this long enough. You haven’t learned the ropes. I don’t have time for you. Well, no, you should have time for them, right? Or if an entrepreneur doesn’t know all the right lingo or all the right words, that’s okay. I will still listen to the pitch all the way through because if I listen to your pitch all the way through, I’m just trying to listen for the business. I don’t need to hear the right buzzwords. I don’t need to hear all the flashy sentences. I need to hear that you got a good and strong business. You don’t need to be able to talk properly to have all the right words to figure that out, right? And so giving entrepreneurs the ability to go through their pitch and listen to them, hear them out, and even if they’re not the most polished or they don’t know all the right words, listen for the business case. Because I could teach you all the other stuff. I could teach you how to pitch. I could teach you what VR, AR, AL, like I could teach you all those things. I can’t teach you how to be a good entrepreneur and build a good business. Right. Cause there’s so much more that goes into that. I can help you build a good business, but I can’t teach you some of the intangibles it takes to be an amazing entrepreneur, to create an awesome business. Right. And so I think more VCs need to do that.

Aoifinn Devitt: Well, that’s great. And you’ve really given us a bit of a sense of your vision for what a VC really should be. Can you talk about that in the context of Rare Breed? And I’m particularly interested in what you’re doing at the pre-seed stage and what the pipeline is as well.

McKeever (Mac) Conwel: For Rare Breed, well, one, the pipeline is amazing, right? Deal flow is incredible. There’s so many amazing entrepreneurs all across this country of all races, sexes, creeds. Like, there’s so many amazing entrepreneurs out there that, like, there ain’t no— there’s no such thing as a pipeline issue. We could talk about a funnel issue with a lot of these underrepresented founders being at the top of the funnel and having harder ways to move through. But that’s a longer discussion, right? At Rare Breed, what we aspire to be is the firm that never misses out on the next Spanx. And for those who don’t know, you know, Spanx went on to become a billion-dollar business. But as the founder was starting the business, nobody wanted to fund her because most traditional VCs don’t understand women’s undergarments. Or how that can be such a powerful company. But for me, I tell my team that what we care about is customer acquisition, experience, and retention. If you can show me, you know, how to find your customers, that your customers like your product, and they like it so much that they keep coming back, you probably have a chance to be a good business. That has nothing to do with your market or any of the other stuff that we as VCs talk about, right? But it gets down to the fundamentals of the business of can you find your customers? Do your customers want to buy it? And will they keep coming back? If you can do those three things and do those three things well, you might have a shot at being a good business. And that’s how we try to strip our biases out or away from when we make decisions in the companies that we talk to.

Aoifinn Devitt: It’s very interesting. I think I heard about that Spanx, that actually the ideas didn’t get off the ground because most of the VCs were male until I think the products were sent to some of the VCs’ spouses or their secretaries. So, basically, that was the only female sort of test market they could do. Do you have to have a very diverse team, or are you sort of literally trying to get into the shoes of your founders and their customers and see it through that lens? Or is it just this customer focus? And I suppose if you’re at the pre-seed stage, do all of the founders have a chance to maybe prove they have repeat customers if they haven’t even had seeding yet?

McKeever (Mac) Conwel: That’s the hard chicken and the egg piece, right? So most of the companies we invest in will have already had some traction, will have some customers. Every now and then we will invest in a company that is pre-product, that is pre-launch. It’s not often, right? Just because, again, back to the deal flow, I’m going to see in a given quarter, on the low end, I’m going to see 500 companies, right? On the low end. And if we add my team in, we’re going to see 750. And of that, I mean, We’ll invest in somewhere between 0 and 6 companies, right? That’s a lot of companies to see in very few investments. And so the thing that tends to separate the companies out is going to be their traction or how many customers they have or how big of a waiting list they have. But, you know, every now and then you’ll find really amazing opportunities going after industries that are so antiquated. That you could take a bit more of a chance on, right? It’s not going to happen every day. As far as the team, I’m the only full-time person on my team. I do have a venture partner, 2 investors, and then 3 fellows, but I use my broader network as well, right? Like, I don’t have a team large enough and diverse enough to really, you know, speak to all these communities, but I definitely do have investors in my network that span the gamut, as well as friends. And I use them very often because I’m not going to know everything, right? If I see a company that’s, you know, in the women’s undergarment space, well, if they got a strong business case, I’m already going to be interested. I’ll probably send it to a few women investors and even entrepreneurs that I know just to get their feedback, right? And to the point where, you know, my fellows and the other investors on my team, they’re all Gen Zers, right? Well, we’re invested in a Gen Z dating app called Monet. The reason why I saw the value in what Monet was doing was because of them. Because, you know, they’re over here telling me about this amazing app, it’s so exciting. I’m like, I don’t get it. But the more and more Gen Z folks I had in my orbit telling me about how great this app was, I was like, okay, I got to meet the team. And then the team blew me away and their traction and growth was exceptional. I probably don’t take a look at that investment without having those individuals on my team. Right. And so I’ve learned over time to listen to all the voices around me to get a full view of what a market is or could be and not try to be stuck with my own thoughts and being stuck in my own mind. Because I know just like anybody else, I have my own biases too.

Aoifinn Devitt: And it all clearly comes back to network as well, since you can draw on that network now and their expertise. The venture arena is known to have a high failure rate, as is probably the founder arena. What have you learned from some of the setbacks and challenges and even investment mistakes that you’ve experienced over the course of your career so far?

McKeever (Mac) Conwel: Being hypersensitive to things that could be legitimate red flags, right? Like paying attention to the way a founder treats other people, the way a founder treats their team, the way a founder treats their co-founders. Speaks volumes for the way they’re going to run their business. Making sure that the lines of communication are always open between me and my founders and making my— and helping my founders understand that the best time for them to reach out to me is when things aren’t going good. Like, when things are going good and going well, we can all say happy things and cheer each other up and boost each other’s egos, but it’s when things are going bad that I hope you reach out to me as soon as possible, right? I can do far more for you when things are going bad than when things are going good. And I’ve had companies in my previous portfolios fail because the founders were scared to reach out to me and tell me they were having some issues. It ultimately led to the company, you know, closing down, when if they had reached out to me right away, probably could have saved the company and kept things going. And so being critical around The red flags are things that feel like little things. It’s almost like dating, right? You know, when you go on the first date, every now and then, you know, while you’re talking, somebody may say something that is interesting or something that may be a red flag, but you know, it’s the first date and they laugh and joke it off and you probably think nothing of it, right? Well, in actuality, that was a real flag they just shared with you, and so you should pay attention to it. It’s the same thing. So being— trying to have that discerning ear and discerning eye for things that could be real red flags and making sure to pay attention to the red flags and make sure that those lines of communication are really well open for my founders, for them to know, like, hey, when things are going bad, contact me. Like, I am here to support you and help you in everything, not just when it’s going good.

Aoifinn Devitt: And how much emphasis do you put on personal contact, you know, actually meeting the person and picking up on the unspoken words, perhaps some of the body language, the cues? I would imagine that’s extremely important and perhaps not— hasn’t been easy over the past year.

McKeever (Mac) Conwel: Yeah. I mean, we launched this fund during the pandemic, so investing while not being able to be in person has become a thing. But, you know, when you’re investing in a company as a team, we always have a meeting with the team and that gives us a chance to ask them questions as a team and see how they interact, to see if they’re talking over each other. If they’re arguing with each other, if they are on the same page with things. You know, when you have a team where the co-founders disagree, that’s a red flag. When you got founders who are talking over each other or being demonstrative and correcting each other, that’s a bit of a red flag. You know, one of the, the number one reasons for companies failing are co-founder issues. Right. So, try to pay attention to that. So, you can see those things in Zoom, you know, just like you can see them in an office room or at a lunch, right? Like, if you sit with somebody for long enough, it’ll come out.

Aoifinn Devitt: Absolutely. So, you’ve already talked about a number of the key people who influenced you along your career so far. You mentioned your father, you mentioned some of the mentors you met at the accelerator, as well as even earlier than that. Were there any key pieces of advice that you received that have stayed with you? And maybe guided you through your career, or any creed or motto that you live by?

McKeever (Mac) Conwel: Some of the best advice I’ve gotten, well, one is always be growing your network, right? Like, network is so important and it’s such a thing that people talk about, but they— I don’t think they put it in the best of context. So like, your network is your net worth. What that means is The ability to pick up the phone and call somebody to get a problem solved, it’s so amazing. Like the same way to have the ability to go to your phone, pick it up and call a plumber that you know, who you know is going to do good work and give you a good price, is as value, if not more, to being able to pick up your phone and talk to somebody you know to get a deal done for a customer or to get a partnership going. Like, the ability to do that comes from your ability to grow your network and create these relationships over time. And so being pushed to do that more has been life-changing. The other thing was, as an entrepreneur, to focus on customer acquisition at the earliest stages, because A lot of founders think that if you have a good idea or a good product, you should be able to get funding from investors. And what I had to learn and what I talk a lot about is, as an entrepreneur, when you see other companies raising money pre-product or pre-revenue, 9 times out of 10, it has nothing to do with the business and everything to do with their network. And if you do not have the same network or the same kind of network as them, then you’re not comparing apples to apples. And so if you’re just starting out and you don’t have that network and you’re trying to grow your business, the focus on getting customers or your customer acquisition is showing demand. Because if you can show large enough demand, money will come. And now, is it going to be hard to show them the demand? Do you have to jump through some hoops? Are you going to struggle, especially if you don’t have the funding up front? Yep, you sure are. But it doesn’t mean it’s impossible. It doesn’t mean you can’t do it. Is it going to be harder than others? Yeah. If you don’t have that kind of friends and family capital, it’s going to be harder, but it’s doable. Right. And so that was one thing I had to learn and absorb as an entrepreneur.

Aoifinn Devitt: And it’s interesting because I think an aspect of networking, in my view anyway, is giving and taking. It’s not just about taking. And I think sometimes people can underestimate the giving part, but you clearly are both a giver. I say primarily a giver, actually, given what we’ve been discussing about here. But how do you encourage the young people to give? I’ve come across people who I won’t hear from for 10 years, and then they’ll come to me asking me for something. And I might be less inclined to help them if I haven’t heard from them in 10 years.

McKeever (Mac) Conwel: So, I tell people, you know, try, like, you know, build a personal CRM, right? You want to keep or put a spreadsheet together of all the people you’ve met. And, you know, every quarter or every 6 months, just send them a note, try to stay in touch. And no, you’re not going to be able to stay in touch with everybody. You’re not going to have the strongest relationships with everybody. And there are going to be some people that you, you might not reach out to for 5 to 10 years. Right. But when you do reach out to them, be very genuine, be sincere. And if you are looking to be transactional or get something from them, make sure you offer something too.

Aoifinn Devitt: My last question is around any advice you might have for your younger self. I mean, looking back at that young computer science student, is there anything that you know now that you wish you had known at that stage besides the networking point, maybe in addition to that?

McKeever (Mac) Conwel: I would have told myself to start listening to audiobooks or reading more sooner. It was only maybe 3 or 4 years ago where I really started listening to audiobooks. I had a good friend of mine who was listening to a bunch of books and gaining all this knowledge. He kept telling me how I needed to do it, how I needed to get on it. And one of the greatest things you can do is become a voracious reader and reading a lot of nonfiction, especially if you want to be an entrepreneur or be in the space, reading these business books, because there are so many people who have already gone through a bunch of the stuff you’re going through, who have made the mistakes, who have had the heartaches, who have had a hard time going through it, who can, who you can learn from their stories. Is a true cheat code in this business. Being able to take in that information will be truly helpful for you. So, I wish I had started doing that sooner.

Aoifinn Devitt: Well, I look forward to putting in the show notes a list of books that you recommend in that respect because— and we are looking forward to whenever you decide to put your own thoughts into one. I think that would be wonderful. So, thank you so much, Mack. You mentioned giving grace to entrepreneurs, and I think that grace that you give and the generosity with which you give it and try to lift up this next generation is really palpable through this podcast. So thank you so much for coming here and sharing your insights with us.

McKeever (Mac) Conwel: Thank you for allowing me to come and spend this time with you, and hopefully your audience is able to gain something from this.

Aoifinn Devitt: I’m Aoifinn Devitt. Thank you for listening to the 50 Faces Podcast. If you liked what you heard and would like to tune in to hear more inspiring investors and their journeys, please subscribe on Apple Podcasts or wherever you get your podcasts. This podcast is for informational purposes only and should not be construed as investment advice, and all views are personal and should not be attributed to the organizations and affiliations of the host or any guest.

Aoifinn Devitt: We approached literally hundreds and hundreds of venture capital firms. You know, I think it was about 300, and of those, we probably started talking to about 70, went into second discussions with about 10, and ended up talking to the final 3, of which 2 were inbound. So my success rate was a failure rate of something like 99.7%. I think that gives you the sort of scale of how hard it is to actually raise.

Ezechi Britton: Founder life. If we were to put together a wall of inspiring quotes for founders and venture capitalists, we might put something like this quote from Michael Dell: Ideas are a commodity. Execution of them is not. We might use the wise words of former British Prime Minister Winston Churchill: ‘Never, never, never give up.’ Or we might look to the co-founder of Dropbox, Drew Houston, who said, ‘Don’t worry about failure. You only have to be right once.’ But no matter the pep talk, we know that life as a founder is hard, riddled with setbacks, hundreds of thousands of requests for funding, and assiduous networking. In this special 50 Faces focus series focused on underrepresented founders and VCs, we meet with a cross-section of both founders and VCs from the US, the UK, and Africa to talk about specific challenges that they face. We provide access to resources, role models, and tips for the next generation. First, we asked why the distance travelled to get to the starting line are so different for many.

Speaker C: How easy is it for you to get to the starting line? Now, some people get driven in their parents’ Mercedes, other people have to walk around the corner, and then there’s a demographic of individuals who have to walk 20 miles barefoot in the cold, jumping over hurdles just to get to the start line. And that piece there is the adversity that most of these founders have to go through just to be in the room.

Ezechi Britton: There can sometimes be cultural barriers too.

Speaker D: Now, when it comes to Black women, 28%, I think, of the Black entrepreneurs, and they’re 50% of the Black working population. When you look at the cultural demands on me as a Black woman, balancing running the business and cultural expectation, etc., there is a pull and a block. There’s a pull at home, which is sometimes cultural, raising the family, caring roles, et cetera. There is a block or boundary or perceived block or boundary that being accepted as a Black woman in business, in the business world.

Ezechi Britton: And once those founders get to the room, is the opportunity self-evident or does the pace of change remain slow?

Speaker E: I was certain that everybody would wake up to this huge gap and this huge opportunity within the next year or two. I was just so confident that my window was so small to break into the industry and sort of make some noise with that as an idea, as a novel concept. Fast forward, you know, nearly a decade, it’s still a novel concept to back diverse founders and the industry just hasn’t woken up to it.

Ezechi Britton: We speak about why the lack of representation is a problem and can lead to diminished social capital.

Speaker F: The lack of representation leads to the lack of knowledge.

Ezechi Britton: We also learn that VCs need to do more to foster success among founders.

Speaker F: So many VCs will just turn that entrepreneur away because they feel like, you haven’t been doing this long enough, you haven’t learned the ropes, I don’t have time for you. Well, no, you should have time for them.

Ezechi Britton: Why is it that the same setbacks, though, can foster a resilience that offers both diversity in business models and style, and why this is cause for hope?

Speaker G: So I see the next few years in the venture industry to be really good. Now, what I do think that LPs need to do is catch on to that and find these amazing women, and just generally people of color to go back because that resilience that they have is going to make them win and not the traditional other folks that are in the market out there that they’re used to backing.

Ezechi Britton: As always, we return to some cardinal rules of founder life and words of wisdom. Seeing entrepreneurs fail, rise up from those failures, and going on to do great things, it’s just showed me that failure is not the end. We’re not to be defined by our failures.

Speaker E: Who— anybody who’s not learning from failing isn’t really doing anything.

Ezechi Britton: So from next week, join us on this fascinating journey, which we will be releasing all during the summer. This series was made possible by the kind support of Wellington Management, one of the world’s largest independent asset managers focused on delivering long-term investment excellence for clients and their beneficiaries, as well as Nile Capital Group, a sector-focused, operationally oriented private equity firm based in the Los Angeles area.

Aoifinn Devitt: This series was made possible by the kind support of Wellington Management, one of the world’s largest independent asset managers focused on delivering long-term investment excellence for clients and their beneficiaries, as well as Nile Capital Group, a sector-focused, operationally oriented private equity firm based in the Los Angeles area.

Mark Mwangi: We approached literally hundreds and hundreds of venture capital firms. You know, I think it was about 300, and of those, we probably started talking to about 70, went into second discussions with about 10 and ended up talking to the final 3, of which 2 were inbound. So my success rate was a failure rate of something like 99.7%. I think that gives you the sort of scale of how hard it is to actually raise.

Aoifinn Devitt: I’m Aoifinn Devitt, and welcome to this 50 Faces Focus Series in which we showcase diverse founders and venture capital investors. I’m joined today by Mark Mwangi, who is the founder of Amitruck, a Kenya-based company which connects transporters, whether a motorbike, pickup truck, van, or even a large articulated truck, directly to clients, and aims to ensure convenient pricing and cut out a large part of the cost of goods. He’s also the co-founder of Dalwin, a natural gas exchange based in London. He was previously a senior investment manager at Pictet Asset Management in London, and prior to that worked in equity research at Bluecrest. One fun fact shared in another podcast is that he’s also a licensed pilot. Welcome, Marc. Thanks for joining me today.

Mark Mwangi: Thanks for having me.

Aoifinn Devitt: So there’s already a very interesting podcast which chronicles your journey and your business model at Amitruck on the Developing Founders podcast, and we have a link to that in the show notes here. So we won’t cover the same ground as that, but it is such a fascinating journey, I’d like to just include a little bit of it. So can you just maybe briefly talk us through your background, where you grew up and how you came to enter finance, first of all?

Mark Mwangi: Yeah, so I actually was born and raised in Kenya. I went to study maths at City University in London when I was still quite young. And due to unfortunate family circumstances, I had to put myself through school by driving a truck in and around Heathrow Airport at night. And that’s how I managed to fund my maths degree. Luckily for me, the silver lining in the cloud was that having done well in my degree as well as worked full-time, I managed to get into a graduate program in investment management. And basically that’s how I broke into investment banking.

Aoifinn Devitt: And then you made quite a big change by moving from investment banking, where I presume you could have continued and had a very successful career, to move to the world of startup land and start your own venture. Can you talk us through your thinking there?

Mark Mwangi: Yeah, so I think everyone thought I’d gone crazy, but I just became aware of the fact that there was more to life than just your bank balance, and the amount of time you’re spending in this world should be to do something more impactful. I wanted to do something that helped my home country and left a bit of a legacy and brought a bit more meaning to my life than just money.

Aoifinn Devitt: You had some experience of trucking, driving around Heathrow Airport. Why trucking? What was the thought process there?

Mark Mwangi: Well, at the time, being younger, it paid quite well, which helped because international fees, I think at City University were about £14,000 a year, plus you had your upkeep. Secondly, you could do it at night, which meant that I was free to study my maths degree during the day. And it wasn’t a job that most people wanted to do. It’s not a very social job. So I had the advantage of being flexible enough to do that.

Aoifinn Devitt: And then when we talked before this, you talked a little bit about the vision for Ametruck. Can you talk about that and how maybe transport costs factor into the cost of goods and what is the problem that Ametruck is designed to solve essentially?

Mark Mwangi: Yeah. So When we first identified the problem, it looked like you had 2 or 3 middlemen between a cargo owner and his vehicle, and they generally were taking, you know, up to 60% of the cost of delivery. And on top of that, if something happened to the load, it’s very hard for the cargo owner to work out exactly who’s liable. So you weren’t sure if your goods will get there safe from theft or damage. I mean, we’ve since now begun to understand the ramifications of this. It means that, you know, something like 60% of the cost of Colgate, you know, a big percentage of cost of medicines and other essential goods are basically transport. And the reason for that is because there isn’t a nice single place, or there wasn’t a nice single place where a transporter and a cargo owner could meet and compare the services that they’re offering. And that’s the space that Ametrak sits in, connecting that cargo owner to competitively priced, secure transport using technology.

Aoifinn Devitt: And when you look at the skill set that you’ve gained throughout your life so far through that discipline, I suppose that resilience you had to build and putting yourself through college, driving the actual trucks, and then a career in finance, which of the skills are you drawing upon now in your role as an entrepreneur?

Mark Mwangi: I think I spent some time on a private equity desk and running actual operational businesses, and that really helps understand the intricacies of business. So not just limiting me to the financial analysis statements and so on, but actually understanding things like culture, teams, boardrooms, customers’ interaction with the business, aligning incentives. And many of those are lessons that I bring with me today. And I think having driven the truck meant that I know what a really nice automated trucking system looks like with forklifts and coded pallets and, you know, lovely belts that pull the pallets in and off the truck. And then, you know, you sort of compare that with what we have here and you can see how much room there is to improve on the efficiency and the way we do things here in Africa.

Aoifinn Devitt: One of the focuses of this podcast is around capital raising for entrepreneurs and founders. Can you talk us through your experience of raising capital as a founder, maybe particularly in your case, and then we can talk a little bit about founders, the landscape more generally?

Mark Mwangi: I think Amitrak is one of the luckier ones. But the process can be very, very difficult. We approached literally hundreds and hundreds of venture capital firms. You know, I think it was about 300, and of those, we probably started talking to about 70, went into second discussions with about 10, and ended up talking to the final 3, of which 2 were inbound. So my success rate was a failure rate of something like 99.7%. I think that gives you the sort of scale of how hard it is to actually raise.

Aoifinn Devitt: And would you say that was a feature of being based in Kenya, maybe the number of VCs that were interested in investing there? Like, did you look to Africa-based VCs? Did you look globally?

Mark Mwangi: Yeah, so we looked globally. I think it’s difficult to raise anyway. I think the fact that you’re in Africa means that many of the global VC firms may not include Africa as an area of interest for them. So it definitely cuts out quite a lot of venture capitalists from looking at your business because you’re just not in an area they’re currently looking to invest in. And then once you get the set of investors who are looking at Africa, you then have the second step, which is to look at investors who would invest in Africa and look at logistics. And then the ones that would, you then have to find the ones that haven’t already got a competing startup. So you really bring down the numbers very quickly.

Aoifinn Devitt: And I just want to ask you a little bit about your mindset over what timeframe was this and how did you kind of keep getting back out there? Did you look for feedback from some of the nos or did you just put them aside and move on to the next challenge?

Mark Mwangi: I already knew that this was not going to be easy. So we actually started fundraising as soon as we set Amitrak up. And in the first 6 months, the trick was to go looking at investors who we knew would never put money in the business, and that was just to get our initial presentation corrected, to get and understand the kind of questions to expect from investors and hone those answers in, and basically also get some practice in how you pitch your startup to a venture capitalist and the kind of questions and interactions we can expect, and also just to get used to it so that you can now start the real serious process of the ones that you think will really invest.

Aoifinn Devitt: And have you ever given thought to just the state, I suppose, of diversity in the, whether the startup space or the venture capital space in particular? Do you have any observations on what you see from your perspective?

Mark Mwangi: So this one has been a touchy subject, especially over the last 2 years. And obviously the data is showing that not many Black-founded startups have received funding and those that have get a lot less. And it’s even worse for Black female founders. I’ve sort of been in this bit from two sides. When I was in investment banking, I was probably one of very few African investment managers, analysts, whatever position I was at the time. And I think there’s a bit of misunderstanding on both sides. On the VC side, I think it’s just the fact that there is such a high amount of trust and a high amount of uncertainty when funding a startup that it would only be natural for a venture capitalist to feel a relationship closer with a founder that looks and sounds and answers questions in the way that they expect them answered. And yes, you might argue that’s wrong and it leads to a racial bias, but, you know, I don’t think that they’re out there with hooded pillows over their heads. I think it’s just the fact that as they are looking through the startup community, the sort of founders they relate to have been to sort of their schools and worked in some of the businesses that they’ve worked in, and they’re just easier to form a rapport during the investment pitching process and the due diligence. And I think on the other side, we have not always had the sort of educational systems and cultural systems that lead us to present very early, learn to negotiate very early, and we don’t necessarily have the same circles. So for example, one of the things you learn as a startup founder, the way to be introduced to a VC, it’s much better to get an introduction from somebody they know and trust than it is for you to try and cold call or cold email them. Obviously, if you’re a startup in Africa, your circle might not include a lot of the American European VCs that are active in the space, and it takes a while before you get the intro. And I think this is just some of the things that will be sorted out by the ecosystem as more success stories come out of Africa and as we get bigger IPOs that will show the success. And I think it’ll sort through that.

Aoifinn Devitt: It’s interesting you said, I suppose optimistically, that it will be sorted out, but I would imagine there’s a lot of space right now for progress to happen, maybe whether it be mentors pushing into that area. Maybe it could be affinity groups or other groups that provide incubation or other support, or even governmental organizations. I know there are sovereign wealth funds in Africa perhaps that, that have a sleeve that could be dedicated to local innovators. Have you seen any of these that look promising?

Mark Mwangi: I haven’t seen anything tangible, but I’ve definitely been seeing a lot of news in and around focusing more on the minority founders. I’ve seen a lot of work happening around the female founders in Africa, but you’re right, the biggest hurdle to a startup in Africa today is probably the availability of capital.

Aoifinn Devitt: A story we’re seeing reflected around the world, actually. So it’s very interesting to have your own unique perspective. So just going back to your personal journey now, moving from investment banking in London to this startup in Kenya, I’m sure it does not come without a significant amount of highs and lows, perhaps. Can you talk us through any of those and maybe any lessons learned that you’ve taken from this experience so far?

Mark Mwangi: Yeah, so I think there’s just interesting little bits. Like, I remember being in banking, you were constantly at risk of having your job taken away because of underperforming. And actually, you’re constantly worried about, would I have a job this time next year? How will the markets treat me this year? And I think the same thing happens in the entrepreneurial world where you begin to realize that you are as worried as you are losing your job of losing your employees. And they are difficult to find when you’re looking for good ones and very difficult to keep and keep motivated. So that’s been an interesting sort of change in mindset with regards to how I view employment and employees. I think the other thing that maybe I could bring up was just the switch in mindset, you know, working at, say, Pictet Asset Management. I tried to follow quite closely the teachings of the likes of Warren Buffett and Charlie Munger and some of these value investors, and they believe in looking at very successful businesses with a very strong track record, with very good management and very good competitive moats. And now I’m sitting in the exact opposite side of that in a small business that has no history, where we’re still trying to work out how it’s going to keep growing. And you’re not necessarily assured it will survive. So it’s a very different, but a much more interesting and fulfilling way to spend your time because you are actually making a difference.

Aoifinn Devitt: And you had quite a graphic description of what some of the kind of day-to-day struggles, I suppose, in terms of the fires you’re putting out on a regular basis. And maybe with the pandemic disruption too, it’s been particularly volatile. Can you share how you describe the founder’s experience?

Mark Mwangi: I think you’re referring to crawling through glass naked.

Aoifinn Devitt: A fairly unforgettable image, yes.

Mark Mwangi: Yeah, yeah, it is. I’ve since heard someone else say it’s like trying to build my wings on the way down and the wood’s on fire and the hammer’s hot. But it’s also fun, right? That’s what makes it exciting. There are moments when you really question what you’re doing and you really, there’s a lot of soul searching. There are many times when you think that your business might not make it and then you walk it out and you get through the other side and there’s a sense of relief. But before you even get a chance to breathe in, something else comes up. So it’s quite a journey.

Aoifinn Devitt: But I would also think the mindset in finance, which is fairly highly charged, it actually can lend itself though to the mindset you need because you constantly need to be flexible and to pivot. And it’s certainly not dull, I would think, the life of a founder. So I suppose it did train you in some way.

Mark Mwangi: So I think from very early on when I was trying to put myself through my maths degree, I realized that you can make a sob story and you can always explain things away. And one of the things I remember thinking quite young was it’s almost like an athlete and someone with a disability trying to cross the road. You know, the truck will hit you both the same way. So you kind of have to try 10 times harder and ensure you get across before the truck does. And it doesn’t help anybody pointing at the athletes with any sort of jealousy or want or anything like that. And it’s that single focus mindset to get to a solution that maybe has helped me in my startup life where we don’t stop to explain what went wrong. Constantly sort of spinning our wheels trying to make sure we’re getting somewhere close to a solution.

Aoifinn Devitt: Absolutely. Getting back to the reflections, maybe were there any key people who influenced you throughout your life or that have really had an impression on you?

Mark Mwangi: I have to say, and this should actually go to the diversity discussion, so if you look at all the key people that have helped me through my career, They’ve all been white European middle-aged men, from my mentors when I went through Bluecrest Capital, my boss and mentor at Pictet Asset Management, when I was in private equity, my manager and boss then. All the people that actually have had a significant impact in terms of my career have all been European. So that just came to mind. The thing that maybe influenced me the most was just understanding that you can fail and survive. And that maybe was the single thing that helped me cross over from employment into entrepreneurship.

Aoifinn Devitt: And my last question is around any advice you would have for your younger self, knowing what you know now as a founder, kind of in the throes of startup phase, anything that you maybe back when you were 16, 17, that you wish you had known then?

Mark Mwangi: Yes, I wish I had come back home earlier. I think having success financially makes it more difficult for founders to take risks. Once you’ve tasted employment, salary, nice flat, nice car, it’s very hard to then think, I’m gonna give it all up and go set up shop in Africa where I have no track record, nobody knows who I am, and that’s a journey that I think would probably work much easier and better if you started immediately after finishing school. So I’d actually say that I would have told myself to come home, start early. And I always look back and wonder where I’d be had I done this 20, 25 years ago.

Aoifinn Devitt: And did it take you long to build that sort of social capital once you did move back to Kenya?

Mark Mwangi: I think I’m on the very beginning of still building that up. You know, I’ve been back for 2 and a half years now, and You’re not a name yet. Nobody knows who you are. So I’m as big as my startup Army Truck is and as big as my team enable it to be. So we are, we’re still working hard on helping clients and hopefully that delight works out as reputation at some point.

Aoifinn Devitt: Just want to follow up on one point you made, because I think it’s very interesting. You mentioned, you know, that the more you’ve worked, perhaps the more you’ve earned, the more you have to lose. More is at risk when you move to a startup. But I’ve also heard Adam Grant, who’s written a book about Think Again, that sometimes the most effective founders are the ones who mitigate their risks. They don’t risk it all. They don’t kind of just jump off a cliff, that they actually have backup plans. And what camp would you say you’ve fallen into? Would it be the— have you mitigated risk in terms of this career change, or was there a lot of risk involved?

Mark Mwangi: There’s a lot of risk involved. I mean, I definitely risked my income. It felt at the time like you were coming into a less organized society where some of the legal healthcare infrastructure maybe wasn’t as strong as it was in the UK. I suppose you can say that about most places, but I think what Adam’s probably referring to was more the that that’s not necessarily a limiting factor. I think if you’ve had a job already, then of course you’ll bring a lot of lessons that you’ve learned from your experience in those jobs back to your startup, and that’s great. But I actually think the thing that stops people from starting a, a business is the fact that they’re already in a comfortable lifestyle, and the idea of startup, which is literally asking questions about, is this a value-added service that customers will pay for the entire time? It then appears to be more risky than staying in employment. And maybe that psychology stops a lot of great minds from switching from careers in investment management, for example, like I did, and coming to solve real-world problems where they have much more of an impact on society and potentially could enrich them even more.

Aoifinn Devitt: Would you say that venture capitalists are looking for all-in type of risk, or are they looking for risk mitigation? Is there any one kind of message you’ve received in your discussions?

Mark Mwangi: Oh, I’ve definitely seen all-in. And, you know, you very quickly figure out that if you have— you’re spending your time doing anything else, if you’re not invested in the business, if you don’t have a significant holding and In fact, most of them will make you vest over 4 or 5 years so that you get a bit of your business back as you work after funding. And all those things would lead me to think that, you know, they really want sole focus, full-on risk to get things done.

Aoifinn Devitt: Well, this has been a fascinating discussion, Mark. Thank you so much for coming here and sharing your journey and your insights into the, I suppose, the somewhat volatile and thankless at times role of a founder. But I think you’ve really brought it to life for us. So Thank you for sharing your insights with us.

Mark Mwangi: No, thank you very much for, for having me.

Aoifinn Devitt: I’m Aoifinn Devitt. Thank you for listening to the 50 Faces Podcast. If you liked what you heard and would like to tune in to hear more inspiring investors and their personal journeys, please subscribe on Apple Podcasts or wherever you get your podcasts. This podcast is for informational purposes only and should not be construed as investment advice, and all views are personal and should not be attributed to the organizations and affiliations of the host or any guest.

Aoifinn Devitt: This series was made possible by the kind support of Wellington Management, one of the world’s largest independent asset managers focused on delivering long-term investment excellence for clients and their beneficiaries, as well as Nile Capital Group, a sector-focused, operationally oriented private equity firm based in the Los Angeles area.

Austin Clements: I said I was going to graduate with either a role in venture capital or no job at all. I ended up graduating with no job at all, but eventually through found my way into the industry with a firm called 1010. So we want to get behind people, as we always phrase it, that are delusional with their vision but pragmatic with their execution.

Aoifinn Devitt: I’m Aoifinn Devitt, and welcome to the 50 Faces Podcast, the podcast committed to revealing the richness and diversity of the world of investment by focusing on its people. And their stories. I’m joined today by Austin Clemens, who is a partner at Slauson Co., a Los Angeles-based venture capital firm that provides pre-seed and seed funding to a range of founders. He’s a Kauffman Fellow and has a strong interest in economic empowerment. He was previously chair of Pledge LA, an alliance between LA’s venture capital community, the Annenberg Foundation, and the office of Mayor Eric Garcetti. He also holds a number of board roles. Welcome, Austin. Thanks for joining me today.

Austin Clements: So excited to be here amongst all the great guests that you have. It’s an honor.

Aoifinn Devitt: Well, thank you so much. And well, let’s start by talking about your background and your entry into the tech world.

Austin Clements: Absolutely. It’s a very simple story, actually. Born and raised in LA, in South LA to be exact, primarily Black and brown neighborhood. Went to Morehouse College for undergrad and came back to LA, started working in finance. In wealth management. I did that for a couple years, enjoyed it, didn’t know anything about the venture capital industry. I was mostly focused on public equities and fixed income portfolios. So then I left that role to start a company. I was doing web and mobile development for a lot of small businesses, and it was there that I really fell in love with working with entrepreneurs. And, you know, they’re the most passionate people on the planet about their work. I enjoyed working with small businesses as well, and I enjoyed applying technology. To their businesses. So coupled that with learning about investing, and it just became extremely interesting to me that you could combine investing and working with entrepreneurs and technology all into one role. I started to learn about the venture capital industry and just became obsessed with it, uh, really wanted to find a way in. Everybody told me at the time— this is like 2009, 2010— everybody told me at the time, like, it’s nearly impossible to break in and find a role. But, you know, nearly impossible. I like those odds. I’ll go for it. And went back to business school. I went to NYU and got my MBA, but really the entire focus of going to business school was to try to find a role in venture. I said I was going to graduate with either a role in venture capital or no job at all. I ended up graduating with no job at all, but eventually found my way into the industry with a firm called 1010.

Aoifinn Devitt: Great. Well, I’d love to talk about maybe what training I suppose you had in the early days and how that kind of, you draw upon it as an early stage investor today. What do you think, I think, equipped you with the tools to be, uh, have the right skills as a venture capital investor?

Austin Clements: Sure, certainly my— I’m oriented as an investor first. I think that, you know, some people look at the industry and say like it’s, it, it certainly makes sense to start as an operator and then come into the industry with that experience, and, and you’ll be empathetic to founders and whatnot. And I’ve seen that firsthand. I think that that does provide a lot of insight if you come at it from the operating angle before going into venture. But you could also be empathetic without being an operator, and that was kind of my approach. And so my orientation to begin with was an investor, but then beyond that, I also did work with a lot of small businesses. These weren’t like venture-backed businesses, these are like local businesses, everything from interior design shops to law firms and things like that, and helping them build technology. So I became very familiar with emerging technology and all of the things that are associated with that, all the good and the bad and things to look out for. So I really started to learn about tech quite a bit in that role, even though it wasn’t necessarily venture-backed tech, it was other kinds of tech. And so I learned from there that I think that that sort of served as the basis for really understanding what’s out there and sort of how to, I guess, how to be a good investor in those particular categories. A lot of it has to do with the people part of the business and then understanding what the vision and the mission of the entrepreneur is. And that’s what I was always able to be excited by and really able to get behind too. That’s what made a huge difference. And that’s, you know, still the part of the business that I love the most now.

Aoifinn Devitt: And do you think business school and other kind of college programs can really prepare you for the skills you need in venture capital, or is it more academic?

Austin Clements: I think that they can prepare you with decent frameworks that serve as a beginning of thinking about how to do it. But, you know, there’s nothing like real-world experience. Business school, I wouldn’t say taught me to be a good investor. I would say it taught me to be a better investor. I wouldn’t say the business school taught me how to work with entrepreneurs. I think it helped refine some of the aspects that I had already in place, and ultimately it was useful. Probably one of the most useful things was for me for business school was to step out of the day-to-day and sort of create a plan for what I wanted to be in this industry and how I wanted to get into the industry. And I think more than anything else, building a good network and taking the time to have a better constructed plan helped me to think about things on a long term, with a long-term view, which in my opinion is probably the best way to have it, is to take a long view on most things that you do, and then you can figure out how to navigate it to achieve the desired outcome. So I wouldn’t necessarily say that there was anything tactical that made me feel like— in fact, there were probably a few things that I had to unlearn coming out of business school in terms of how to work with companies, because startups are fundamentally different. I think business schools have gotten a lot better about that over the years, though. It taught me a few things, but also had to rethink a few things as well.

Aoifinn Devitt: So just moving now to your work at Slauson Co. So what kind of incubation services do you provide beyond capital, and what kind of pipeline are you seeing at the moment at the pre-seed stage?

Austin Clements: Sure. So yeah, pre-seed and seed stage is where we’re primarily focused. So in most cases, we’re leading the deals that we do, and we’re the first institutional check into the company. And often we’re taking between 50% and 75% of the round and, you know, usually investing somewhere between $250,000 up to a couple of million as an initial check in. But we also recognize that the founders that we’re backing in most cases can benefit from more than just the capital in terms of our relationships and guidance and perspective and help and support. That’s just a huge element. Slauson and Company, we very intentionally named it and Company versus like ventures or capital or anything like that because really it’s about the company that we keep. That’s the biggest asset that we have. We’ve been very fortunate enough to have just an excellent list of advisors and corporations that have gotten behind what we’ve done, that are supporting what we do, and want to provide resources to the founders that we back. So when I think about what we do, we usually make an investment, and then in the early days, we’re talking to the founders on a pretty regular basis, understanding what they need. This isn’t a matter of them reporting in to us about like, hey, tell me what you did this past week or whatnot. That’s not really what it is at all. It’s more we want to say, hey, what do you need? What are you working on? What’s top of mind? Give people a chance to step out of their business for a little while and ask questions, big picture questions. And our job is to help advance their vision as much as we possibly can. And fortunately, we have a lot of resources and a pretty solid network that we’re really proud of that we can lend to that founder.

Aoifinn Devitt: You’re strongly motivated by the need for economic empowerment. How would you assess the current levels of access to capital for underrepresented founders?

Austin Clements: Abysmal, and it’s been that way. You know, one of the things that interested me most about coming into the industry with an investor orientation was the fact that I realized it was very, very obvious to me from, you know, a decade and some change ago that if I could act as a means to provide capital to the types of brilliant people that I grew up around, the people that came from communities like mine, where there’s just so much genius there and so much cultural relevance and so many things that are birthed out of neighborhoods like that, but just don’t have access to capital or resources or guidance from mentorship and things like that, where people that have achieved success. All of that stuff seemed like very, very far away when I was growing up. And so when I got into the industry, what I realized with my investor orientation is if I can make that connection, then I could create a firm that could do really well from a performance standpoint. When I think about where that was in 2009, going into business school and, and trying to break into the industry, I was certain that like everybody would wake up to this huge gap and this huge opportunity within the next year or two. I was just so confident that like my window was so small to break into the industry and sort of make some noise with that as an idea, as a novel concept. Fast forward, you know, nearly a decade, it’s still a novel concept to back diverse founders, and the industry just hasn’t woken up to it. I think that obviously the activity around last year and all the social justice conversations put a spotlight on it, which actually attracted a lot of capital to the category, which is a great thing in my opinion. But I still don’t know that most folks realize how massive of an opportunity there is to back diverse founders. And if you do it, and if you’re authentically connected to those communities and you’re authentically connected to the traditional venture community, then there’s a whole lot of success to be had.

Aoifinn Devitt: And it’d be great if you could paint a picture of that opportunity and maybe just compare it to maybe the typical venture capital opportunity, because I mean, the typical venture capital opportunity I think of, there is a fairly high failure rate sort of baked into that. But what is it about the diverse founder opportunity that you think is so compelling?

Austin Clements: Sure, I think that there’s still a failure rate that is going to be fairly high. I mean, like, I worked for— I worked with small businesses before, and the failure rate isn’t too much different than venture-backed companies. So when I think about failure rate, I think it’s still about getting behind opportunities that are swinging for the fences. I think that there are plenty of models and actually some opportunities out there for models that accommodate various types of businesses that aren’t trying to be, you know, massive scale or things like that. And down the line, I’d love if that’s something that like Slauson would explore. Right now, our focus is primarily on very, very large-scale opportunities. So we want to get behind people, as we always phrase it, that are delusional with their vision but pragmatic with their execution. We want people that have a vision that’s almost like unsettling about how, how big it is and what they want to grow their company to be. But then they’re very pragmatic in the sense of they know what the first few steps look like and they’re actively doing it and they’re focused on doing it. So that’s what we look for in founders, and we’ll continue to do that from Sloss Co.’s perspective.

Aoifinn Devitt: And do you think some of the barriers to capital raising are due to lack of diversity in the venture space? So the actual, the investors themselves are not diverse enough and therefore they’re not recognizing this opportunity.

Austin Clements: I mean, I think so. I think that that is a key component of it. I’m always really reluctant to paint venture as like a bunch of evil people that are, you know, very intentionally trying to leave people out. I don’t necessarily think that’s the case, or at least that hasn’t been my experience with most of the people that I’ve interacted with. With that being said, most of the people do come from a fairly homogenous group where in that they went to the same schools, they worked at the same companies, and now they’re backing each other and helping each other’s companies grow and scale. I think that what happens is when you take people that are VCs from diverse backgrounds, their life experience is different and their networks are different. And so they can take the knowledge of how venture works and apply that to different networks naturally. One thing I think about is, you know, I went to Morehouse for undergrad, right? If I meet a founder that went to Morehouse or went to Spelman or Howard or most HBCUs, like, I think of that in the same way that somebody who went to Stanford thinks about when they see somebody that went to Stanford. I think that this is a very high-achieving person with a very strong network. And a defined perspective and an opinion about something. Those are sort of the qualities that I get. If you didn’t go to Morehouse, if you didn’t go to Spelman or Howard, you probably would have no reason to believe that about these schools or these institutions. But because my life experience is fundamentally different than that, I can bring that perspective to the industry and help founders that come from that background to succeed.

Aoifinn Devitt: Absolutely. It’s sort of having the insider view. Being from Ireland myself, people would always send me the resumes of Irish people because I would know, oh, that university is good or a degree from that university actually is slightly different. It means something different. So I think that’s a very good point. You really do need to have the inside view to be able to, I suppose, interpret the credentials that have come from a similar background. What particular interventions have you seen? Maybe the word isn’t to be interventions, but I suppose methods or ways of— is it affinity groups? Is it better networking? Is it more outreach to founders? More of this kind of incubator work or more groups like you had at Pledge LA, the alliances? What have you seen to really help to get the funding into the hands of where it’s needed?

Austin Clements: So one thing we recognize and appreciate is that there’s a limited number of companies that Slauson can back from each fund. If we talk to 100 companies, we’re probably going to back one. That doesn’t mean that the other 99% of the companies that we talk to are not worth existing. It’s just a matter of fit and where we could help out most and all those other things. Usually those top 10% of companies that we talk to are actually quite phenomenal companies all in and of themselves, and we just, again, end up picking one. But we started to think about how do we advance the mission of economic inclusion by supporting more companies? And one of the ways that we wanted to do that was through a program that we created called Calling on Capital. It’s a program that we’re doing in conjunction with Grid110, which is an accelerator that’s based in LA, a nonprofit accelerator that takes no fee, no equity, but just helps out emerging businesses. Grid110 has a phenomenal track record of diversity in the sense of they have 70% of the founding teams have a woman, 70% of the founding teams have a person of color. The accelerator is just really, really strong. And so we partnered with Grid 110 to create Calling On Capital, which is a program that’s designed to help more companies be able to raise capital and get matched with the right investors. So even though we may not be the best fit, we want to be able to touch more companies and help them prepare to raise capital from other investors as well, even if it’s not us. So again, I talk a bit about my As a, as a Black man in America, I feel like I have a social obligation that I have to hold to advance society in the interest of inclusion. I think that this is one of those ways that it could manifest, where even though there may not be a direct benefit in terms of our portfolio, we certainly see a benefit in terms of the mission of what we’re trying to accomplish. I don’t think that there’s anything that you could do that will move the needle like getting people from these backgrounds. Into the conversations and everything else. I mean, that’s what I would do. I’ll give one example that maybe might hit home for a broader audience. When I was at the firm 10 One 10, I was very, very active in a lot of different diversity groups, very active with women entrepreneur organizations. I spoke on panels and everything like that and thought that I had a pretty decent in with women entrepreneurs. But as soon as there was a woman VC that was added to the firm that I was working with, the number of female founders that came through the door skyrocketed, right? And so it’s just something that I as a man cannot replicate, even, you know, with the very directed intention behind trying to get more women founders to be evaluated from our firm. Like, the point is, when you bring in a woman VC, it just changes the entire dynamic. And so, you know, we think about that as we’re growing our team as well, who the types of people that we want to bring to the table and the networks that they have. So it’s not just— this isn’t just a critique of white men in Silicon Valley. This is more of a reality of how all firms should be thought of. If you’re trying to attract more people from different networks and different demographics, you’ve got to hire people that come from those networks and those different demographics. It’s as simple as that.

Aoifinn Devitt: Of course. And then after the hiring, there has to be the inclusive environment so they, they thrive. And that’s my segue to an article you wrote recently called The Delusion Around Inclusion. Can you talk a little bit about the points you were making there and what that delusion is?

Austin Clements: That article came on the early side of our fundraise for Slauson Co. We were putting together, this is pre- George Floyd murder. This was pre-Black Lives Matter events, things like that. So we were fundraising during that environment. This article came after that, but we were fundraising during that environment and we kept hearing the same ideas that were felt so wrong or so incorrect about the assumptions of what we were doing around the different types of founders that we were targeting and who we were serving and how we were positioning ourselves. It seemed so wrong from that and so common. We had the same common mistakes that people were making about what we were doing that I was like, we should write an article about this rather than having the same conversation over and over. So there were a few things that popped up, like a couple that I’ll touch on. One was this idea that it was a niche audience that we were going after, that going after minority founders or underrepresented founders is a niche approach to the business of venture capital. And thus, as a result of that, we’re basically limiting our opportunity or our ability to find what would be the next breakout company. If you look at the changing demographics of the country, you’ll see very quickly that if we’re talking about women and minorities, we’re actually talking about the majority of the country, right? What’s niche is actually targeting a few schools in two or three cities in the country and assuming that all of the talent, all of the ambition, all of the great ideas of what could shape the future are located there. Like, I’d argue that that’s a fairly niche audience that they’re going after. Obviously it’s worked relatively successfully, but when it comes time to thinking about building a firm and differentiating, and you see literally 1,000 new firms popping up, that are all targeting this niche audience over there, to me, the major opportunity seems to be in the lake where we’re fishing, which is pretty much the rest of the country. With that said, I think that the other thing that people associate most closely when you’re talking about diverse fund managers is that it’s some sort of philanthropic or charity work. And implied in that is that there’ll be some concessionary returns like we’re doing it for the good of society rather than being able to produce above average returns. I actually don’t think that’s the case. I think that as a Black man in America, I do have a moral obligation to look at society and see where I could change and see where I could impact things in a positive way. But as far as this firm goes, I actually think that the approach that we’re taking leads to outperformance rather than underperformance. And that’s mainly because, again, we’re not targeting the niche community, and thus it’s not as competitive to find really, really good opportunities and really good founders. I actually believe that where they’re fishing is a lot more competitive, and they are actually just paying really high prices, often inflated prices, because so many people and so many firms are going after just those communities. Whereas with us, we can find more fair valuations and find companies that aren’t thriving on hype, but in fact are really building very solid businesses that are in a position to scale.

Aoifinn Devitt: That was exactly the nuance I was driving at when I asked about the difference perhaps in profile and returns and risk management, because this came up in my conversation with James Norman as well. We spoke about just the fundamentally different backdrop to some of these businesses. They perhaps have, first of all, that the founders themselves may be fairly resilient having got to that stage without perhaps the advantage of friends and family capital. And they may have already had to prove their concept because, as you said, they can’t thrive on hype because they’ve had to perhaps build a customer base and demonstrate it before they even get to the boardroom stage of presenting. So I think there is quite a different kind of backdrop and it’s really interesting to, to sort of parse that and see how, how makes the returns arguably, well, certainly divergent returns. They may be good diversifiers.

Austin Clements: You’re absolutely correct. I like the idea that we hear about from, particularly from a lot of diverse fund managers when you’re talking about diverse founders, the concept of distance traveled. Like basically how far did you have to get to, or what, what did you have to overcome to get here? And what we find is that people from the backgrounds that we typically back They travel pretty far in terms of like their personal lives and development and things that they overcame. And they didn’t have, in many cases, the friends and family round that would give, you know, the $100,000, $200,000 to start and work on a concept. That just doesn’t exist for the majority of the population in the communities that we’re serving. And so as a result of that, you know, even if you’re, if you’re a VC that’s trying to look at things objectively and just say like, I don’t care if you don’t have a high school degree or, or what race or gender or sexual orientation you are, but like, if you’re hitting these metrics, then I’ll back you. And as a result, there should be an even distribution of the founders that I should back. I, I think that when you look at those metrics, a lot of time you have to put those in the context of what resources did that person have. At the very earliest stage to get those metrics. And if you ignore that component of it, then you’re almost certainly overlooking a whole lot of talent that should they be given a small amount of capital, they could just do a whole lot with a little because that’s what they’ve been used to. So there’s just massive opportunity.

Aoifinn Devitt: Really interesting what kind of creativity can be born out of constraints. So just now going— obviously you’re in the venture capital world. We talked before about the high failure rate that just permeates the entire venture capital arena, um, needing to have a stomach for that. What have you learned from some setbacks or challenges or even investment mistakes that you’ve experienced in your career?

Austin Clements: I’ll talk about mistakes that I made early in my career in venture. Early in my career, I think that I was a lot more ego-driven in the sense of when I’d hear a pitch I’d try to poke holes in the opportunity and find out, think about things maybe the founder hadn’t thought about, or challenge and find out ways of basically saying like, this is potentially how the company could fail because of this, that, and the other thing. And I think, you know, after you look at a thousand or a couple of thousand companies, you realize at the seed stage, that’s every company. Every company has holes, every company has gaps, every company has major things that could lead to a failure. And so the real courage, the real skill in this business comes with being sort of brave enough to get behind somebody when you are fully aware of the challenges that it’s facing and the gaps that it’s facing and still believe that there might be a chance that this founder can navigate those obstacles and figure out a way. And so I think that my view went from to being much more optimistic. I think generally I have always been an optimist, but in, but just in terms of my interactions with founders, I, I go into every meeting hoping that this is the meeting that will lead to the company that will make my career as an investor. You know, this is not— I don’t take it lightly at all. I try to take everything seriously and come in prepared and respectful of the founder because this might be the person that can make my career as a VC. So I want to come into meetings with that kind of intention versus the arms crossed, eyebrow raised skepticism of like, oh, well, have you thought about this? Of course they have. And of course they’re fully aware of it because they think about their business every day and every night. So I’d say that’s probably one thing, one challenge, or one way that I’ve evolved over the years.

Aoifinn Devitt: And one of the things you mentioned earlier is around networks perhaps and how you weren’t initially aware of the networks. Maybe you didn’t have mentors initially but gained them later. Were there any key people over the course of your career or life so far that have really had an influence and really some that you could mention?

Austin Clements: Sure, there are a few key people along the way that have just made a massive difference in the venture ecosystem. So let’s see, there’s Brad Feld, Mark Soester, Fred Wilson that were bloggers, and that was really how I started to understand the industry was through their blogs. That’s when I, you know, a lot of the advice that I was giving to some of the entrepreneurs that I was working with when I was just running a dev shop mirrored some of the things that they were saying on their blog. And I was like, these are guys that are at the top of their game and I’m learning a lot, but also I understand this because I’m kind of doing it but in a different way. So that’s what made me really interested and feel like venture could be the career for me. Then beyond that, David Waxman, who I did actually know in person because he gave me my first full-time gig in venture at 1010 Ventures. David is just a phenomenal human being who really, I learned so much from him. The two things that I’ll call out here, one is that what it’s like to watch someone who comes from an operator’s background work with founders. His experience across the three companies that he founded that all had varying outcomes was so useful when he’d sit across the table from a founder, and it was so impressive. And, you know, some of those conversations are things that I’ll never be able to say because I was never, you know, the founder of a venture-backed company. But it also did— it helped me understand where my strengths were as well and where my perspectives were— would add a lot of value. And so I was able to lean more into who I am and also appreciate the skills of people who I am not. Another person— I’ll give two more people really quickly— another person is Kareem Webb. Who is a founder of Fourth Movement. He was a serial entrepreneur that came from our neighborhood. And Kareem is really, really dedicated to creating opportunities, economic opportunities for people of color. And he taught me essentially that as we build the firm, it’s not about selling people in the firm, it’s about enrolling people in our vision. It’s not for everybody, but for the people who are on board, they really, really are on board. And I think it’s shaped a lot of how we built the firm. And then the last person I’ll say is Ron Conway, who, you know, even before all the social justice stuff of last summer, was very interested in working with fund managers of color to find all the opportunities into all these untapped founders. And Ron came across us, me and my partner AJ, and he sat down with us and kind of talked to us and heard about our vision and what we were doing. And and in many ways took us under his wing. And Ron at SV Angel has just been phenomenal with helping guide us and mentor us and support us and open his relationship network, which is second to none, and certainly accelerated a lot of what we were building. So those are the people that immediately come to mind as being transformative to what we were doing.

Aoifinn Devitt: A long, illustrious list there. Are there any rules that you live by, any creed or motto, maybe based on some advice you received or just something that you discovered for yourself?

Austin Clements: Sure. The one motto that I live by is actually from Kahlil Gibran. He said, “Progress lies not in enhancing what is, but in advancing toward what will be.” And I really liked that because I think that a lot of times when you think about progress or You know, people think about, all right, here are the things in front of me. How do I make this better? And I think the idea of advancing toward what will be takes a different approach where you’re like, well, what is the future state of all this? And how do I get there? And that’s just a different orientation that has informed so many aspects of my life from what career I decided to go to. Obviously, you could imagine how that fits very directly into venture capital. To marriage, to how I think about parenting my son, to friendships and everything like that. That motto is basically at this point ingrained into my DNA.

Aoifinn Devitt: Well, that’s a very nice and optimistic way to bring our conversation to an end. But I do have one last question, which is around any advice you might have for your younger self. Is there anything you know now after a decade-some year in about career and venture that you would like to tell perhaps that young college student at Morehouse College?

Austin Clements: I would say it all comes in handy. What I mean by that is another thing we say at Slauson is your life experience is your competitive advantage. When I was in my 20s coming out of college, I couldn’t even tell you at this point how many jobs I had between college and me finding my way to the venture capital industry. And it was always like really trying to find my way and trying to decide what was for me, and should I be following my passion, or should I just try to get paid as much as humanly possible and then do my passion on the sides, or anything like that. So I ended up doing a bunch of different things and then learned from all of them. As I work now, all of the life experience comes in handy with, with building my firm, with dealing with people, with all things like that. So I don’t feel like there were too many missteps. I don’t really regret much at all because I look back and I just say to myself, it all came in handy.

Aoifinn Devitt: It’s funny how stories converge from totally different backgrounds. I just published a podcast this week from a young Israeli woman, and she had a similar experience hustling through the grueling world of media. And her said was not a minute was wasted in terms of those kind of the slavish internships, et cetera. Everything, it comes home to roost in terms of having a use Well, thank you so much, Austen. It has really been a pleasure speaking with you and listening to your focus. Your relentless focus on economic empowerment is really quite inspiring. You’ve talked about vision a lot here, and obviously visions have to be bold, and you certainly have not only engendered— have you had your own vision, but also encouraged that of others. And I look forward to seeing where some of those visions land. So thank you very much for sharing your insights with us.

Austin Clements: Absolutely. This is great. I really enjoyed this. Thanks for having me.

Aoifinn Devitt: I’m Aoifinn Devitt. Thank you for listening to the 50 Faces Podcast. If you liked what you heard and would like to tune in to hear more inspiring investors and their personal journeys, please subscribe on Apple Podcasts or wherever you get your podcasts. This podcast is for informational purposes only. And should not be construed as investment advice, and all views are personal and should not be attributed to the organizations and affiliations of the host or any guest.

James Norman: The only thing that actually will change social equity here in the US and the greater broad world is economic inclusion. Having proper economic standing for the work that you put in and ideas that you put in the world.

Aoifinn Devitt: Our next guest has been an entrepreneur since he was a young boy. Let’s hear why he believes the pandemic has shifted the playing field to allocate more points for those years of hustle. I’m Aoifinn Devitt, and welcome to the 50 Faces podcast. The Investor’s Podcast, a podcast committed to revealing the richness and diversity of the world of investment by focusing on its people and their stories. I’m joined today by James Norman, who is CEO at Pilotly, a market research platform for creative content. He’s a partner at Transparent Collective, a group of founders dedicated to increasing exposure and access to Silicon Valley for African American and Latino Hispanic men and women. He’s a serial entrepreneur who built his first company at the age of 16. Welcome, James. Thanks for joining me today.

Speaker C: Thanks for having me.

Aoifinn Devitt: Can we start by talking about your background and your early entrepreneurial instincts? Did you always want to explore new ideas and monetize them?

Speaker C: Yeah, certainly. I don’t think I knew what the word monetization was at my earliest stages of life, but yeah, I mean, I was just kind of— I’ve always been doing my own businesses, and I think like the first thing I ever started was me and my friend, we were super into video games and So we would, you know, we were close enough that like, you know, I could throw a video game across the fence to him. So we just buy different games and share them. But we had amassed enough of a collection to start renting them out. And then we said, well, we’re the best at this, so we should start selling tips. And so we had a video game tip selling service. We might get on the phone with the kid and walk them through something or things like that, write up instructions. So that was like my earliest business. I was probably like 9. I’ve been doing this stuff for a long time. I’ve always seen things and wanted to be in certain places and know it costs money to do so. And so my earliest phases, I was just trying to find ways to make money to do the things that I thought were most important or the coolest thing or something I wanted. So it’s kind of like where everything started. But my first real company— when I say real company, like making enough money to do the things that I wanted— was MJH Sound. I started in ’95, so that was an e-commerce— e-commerce wasn’t the word then, there was no PayPal, any of that. So it was a website where I was selling car audio around the world, and so I did that for a number of years up until I ended up going to university.

Aoifinn Devitt: And can you tell us about your current role at Pilotly? What exactly are you doing there, and what’s the history behind that company?

Speaker C: Well, the history of Pilotly is deep just because You know, when I started my first company online in ’95, it’s not like I knew what the dot-com boom was or if I knew what a venture capitalist was or any of that. I was just making money. So I didn’t even know what a tech company was per se until, say, 2008. You know, I met a friend of mine, Drew, who started Dropbox. He made it very apparent to me that you could raise money for something that didn’t make any money and there was a whole ecosystem around it. And so that kind of exposed me to the idea that I was going to go build a tech startup. I was in LA at the time. So because I was in LA, I was like, well, I was around Hollywood. I was building cars for Fast and Furious. I think by the sheer nature, I came up with a TV-esque tech company, which was Youbee. And that was my first foray into the video space. So I was building this online channel guide that would aggregate all video online into one place. To make it personalized and easy access on any device, with the idea that no one will have cable by 2020. So people know that to be true now. 12 years ago, people thought I was crazy. So that was my foray in the video. And so through the cycles of that company, getting someone who wants to acquire the IP of it, and moving on to build yet another company called Groupflix, which is going to be à la carte TV service around 2013— during the process of that, that second real tech company, that’s when Pilotly started kind come to life because no one was going to fund the à la carte TV service. We had the product built, we had thousands of people sign up with credit cards, we had contracts on the table from Warner Brothers, Starz, and Sony. No one was going to give us the money to move forward. So I was like, I’m not putting my net worth on the line to do this. I’m, you know, it’s not fair, right? So I was like, what can I do to make this into something that actually is a business? And so when I talked to the customers, well, they weren’t my customers yet. When I talked to people who were gonna sign the contracts with, I asked them about data because Netflix and Google, etc., weren’t delivering any data to the people that they distribute content for. And they told me about focus groups in Vegas and Orlando and Burbank and how they were doing focus groups just with people off the street. And there was a little bit of science to it, but not so much. It wasn’t so effective in my time. It was completely ineffective when you look at how much content is made every day now. You can’t even run enough focus groups in a year to account for all the research that you need to do around the content that’s created now. So Pilotly became the solution. Like, let’s put an interactive layer on top of this à la carte TV service, kind of consumer-facing, you know, user experience. Let’s collect this information around this content. And over time, we built all these tools and built a suite and a platform that allows, you know, you do like this rapid research that’s cost-effective but still get like these bespoke outputs from it. So it’s very different than running like a SurveyMonkey. Most people aren’t researchers, so you really don’t have any business writing a survey Monkey to do research on any kind of content. But if you did do that, all you’re going to get out is a bunch of numbers. What you need to get out is, you know, the character is not resonating with this core of the audience, this scene didn’t work, people have this high of an intent to continue watching the next episode, and this is why, this is what you might want to lean into as you continue developing this piece of content, or this advertisement is offensive to this cohort of women, or whatever it might be, you know. You need to have that type of direction And so usually it only comes from a consultancy and not from a tech company. So at Pilotly, I’m the CEO. Our mission is to create cultural relevance, to, uh, allow people to understand where their content fits in the world and with whom.

Aoifinn Devitt: That sounds absolutely fascinating. It also seems to be resonating quite a lot with big creators nowadays. And we’ve seen commitments to dedicate it or earmark a certain amount of capital to diverse content created by diverse creators. So it seems that there is a need now to reach out and really to, to a wider range of consumers.

James Norman: Yeah, that’s kind of the way we see it as well. You know, when the business started, it was just for pilot TV shows, but the first thing we did was test a shift in brand perception for a piece of branded content for Home Depot. And that kind of made me very aware that this was a much bigger solution than I originally anticipated, no one had really built a platform specifically to test creative content because there’s so many layers to how one experiences something that is visual because there’s the audible part, right? So even the audio part has some complexities to it. Like if we’re testing a podcast, we’re going to look at the intonation of people’s voice, how much overlap there is in the conversation, who dominates the conversation, who doesn’t, who’s the most preferred speaker, did someone learn something from them? Like that’s just audio. When you bring the visual to the table, it changes the whole dynamic. What you see can very much dictate how you hear what you hear and how you lean into the story at hand.

Aoifinn Devitt: And do you find your clients respond and adapt according to what your rocket research is telling them? Are they able to respond in real time?

James Norman: Certainly. Sometimes people are looking for data points that they’re looking for to tell the story they already want to tell. And that’s fine, that’s totally up to them. But, you know, more often than not, we’re not just here for, I guess, wall art. They want to make changes to what they’re doing, and the speed of what we do becomes imperative to that. Because I remember one time it took us like 4 days longer than we thought to get feedback on a piece of content, and they were like, hey, we can’t do that again because people were waiting on the set for the feedback. And like, that costs money, like keeping people on the set for a show, right? It was cool that we saw people were using the information, but it was also like, okay, wow, we got to keep on improving and improving so we can make sure we’re always on the dot. Now, not everybody does it in that way where they’re actually iterating live, but they are using that information to inform future marketing decisions, inform different conversations about other content they might produce. They might actually go back and recut something in post-production depending. So it’s used in a bunch of different ways.

Aoifinn Devitt: Really interesting. There’s a phrase that we’ve heard before in the podcast, which is around the suggestion that access to capital is the last frontier of the civil rights movement. What are your thoughts on the current levels of access to capital for diverse founders?

James Norman: So I can’t speak on it as intelligently across all diverse founders, as my expertise is just now on Black founders, even though I work with all kinds of people. My expertise on the subject is around Black founders, but it’s definitely the last frontier in the sense that as a kid here in the US, you’re always— there’s Martin Luther King Day, right? And you’re taught about this speech, and I have a dream, and you got these civil rights, and yada, yada, yada. But what no one told you is like, you got the rights to be a part of a system that wasn’t built for you. And so hooray for you. Like, let’s see what you can do within the confines of that system. And some people break out of it. Of course, there’s always going to be the token exceptions, but ultimately, like, is really built against a certain population of people, specifically Black people, and then that trickles out to other people who get closer to our, like, skin tone color, essentially. You know, here in the US, like, skin color is very associated with worldview, and it is that way because of the way the country was set up, the way housing opportunities were set up, the way education was set up, etc. Just by grouping people together by how they look led us to a world in the US where skin color is highly associated with worldview and access. So access to capital is the most important thing, and that’s something that someone like Martin Luther King realized just before he was killed. That was going to be the last portion of his life, but it kind of got dropped on the ground there. It was the same thing Malcolm X had been talking about, but people thought being money-driven and being militant was also not good, which, who’s to say it’s not good when you’re actually in a war for your access to live? So there’s a balance of these two things. And in the end, what it comes down to today is I think people have seen the NAACP and the this and that, the different nonprofits that are Band-Aids in a broken system, not perform. Like, they help certain things along the way, but it’s not actually changing anything. And so the only thing that actually will change social equity here in the US, in the greater broad world, is economic inclusion, having proper economic standing for the work that you put in and ideas that you put in the world. And right now, even for those Black people who are getting funded, it’s still not an even shake. On average, we have a 15% to 20% less valuation when you compare it to our counterparts in the common market. We don’t get our full rounds of funding, which further limits our ability to matriculate up to larger rounds of funding to get to the, say, unicorn scale of company. You know, we’re just now seeing billion-dollar value companies led by Black founders in the past year, basically, in the pandemic. While has been a tragedy globally, has been probably one of the most important things that ever happened to Black people. We are most likely to get sick and things of that nature because we’re more in lines of work where you need to go to work. You are an essential worker, essentially, in a lot of cases, or your family is, and so you’re in and around people who are more in touch with COVID more. But when I say that, I’m speaking with respect to the Black entrepreneur because we never get any brownie points for the durability and sustainability of what we bring to the game in entrepreneurship. I’ve been doing this, like I said, since ’95. I ain’t never received a million-dollar check in funding from anybody. And I’ve been making a living like this since I was a kid. I should get points for that. It doesn’t matter, it doesn’t matter how big my IP acquisition was, it doesn’t matter what school I went to. There’s very few people you can meet on this earth who’s been doing this as long as I have, and I don’t get points for that. But in the pandemic, You get points for that. Everybody’s getting points. These people came into the pandemic with damn near no funding and kept building businesses and found new opportunities in the dark place to make further money while people were stuck at home. When you see that and you’re a VC and you’re stuck with a bunch of other people talking about ideas that don’t make money and won’t make money forever, your brain starts to shift towards where the money’s at. I’m doing some research right now, so it’s anecdotal, so I’m saying it. Kind of with a distance, I’ll have the data in a couple more weeks finalized, but I do believe that there was more capital deployed to Black founders in the past year than there ever has been. Not by number of checks written. I don’t think there was more checks written to Black founders in 2020 versus 2019, but there was more money deployed. So there was a series, there were Series As happening, there were Series Bs happening, there was large seed rounds happening that never happened before. And that’s because people are starting to take the demographic a little bit more seriously. And the death of George Floyd further fueled people to open their ears.

Aoifinn Devitt: Such an interesting observation. I was just thinking, as you mentioned that, whether there has been a bit of a leveling of the playing field, perhaps because some of the networking has been cut away or impossible, less in-person networking, more online. Maybe it’s more about proving the concept and not just sketching it and dreaming it, that there is a bit more of show me the money. Maybe that has actually benefited Black founders more.

James Norman: Well, it depends. It gets a little dicey. Depends on where you’re at because you actually find that, you know, because Black founders actually need to make a living in most cases, they do start trying to make money earlier than most other companies. And what can happen is when you go to pitch the company, you’re so tied into the product and the money you’ve been making and you’re proud of that progress and you believe it’s a further validation that she should give you money by articulating the size of your current business and how long it took you to get there, what you have, you actually end up boxing yourself in unless you’ve done something absolutely amazing. Like if you build something that makes $100K, it took you a year to get to $100K, it doesn’t seem completely replicable from that point. They’re like, okay, well show me more traction. And you’re sitting there as a founder like, I did this by rubbing twigs together, what are you talking about? But that person doesn’t see that journey, it doesn’t process for them. And so a lot of times telling a grandiose idea that has no structure around it allows them to dream and find their way into the conversation. For Black founders, oftentimes we have to become the foremost expert in what we’re doing to get to making that money. So we get in the conversation, we’re pitching it, not only is it maybe not actually explaining something that could generate over $1 billion in the next 5 to 7 years or be about $1 billion valued per se, it doesn’t leave room for the VC in the conversation. The VC is there to have ego as well. I am great. I can help you. How can I help you? This is how I can help you. Let’s have a conversation about solving this problem. They want to have those conversations because that’s what makes them feel good. There’s very few people out there just writing checks because they’re like, that’s the one, here’s the check, I’ll see you later. Like, there’s very few people doing that. And so when you come in as the foremost expert in your space, it’d be hard to manage the energy in the room. You know, when you’re having a conversation, there can also be, like I said, they don’t know how they can help. So then, you know, I mean, maybe if you should find another lead investor because I’m not gonna be the best one to help you. Versus if you don’t know anything, they’re gonna be able to help you because they’re not dumb people. Right? You have this fine balance of being knowledgeable, but not knowing so much that you box yourself in and box other people out.

Aoifinn Devitt: So it doesn’t seem like it’s simply a factor of there not being enough diversity among the VCs themselves.

James Norman: Not at all, because there’s been Black VCs well before now. It doesn’t mean there’s been more capital deployed into Black people. Most people who are venture capitalists up until the past couple of years learned from the same school of hard knocks, the same track that everybody went through. They all went to HBS, they went to Stanford, they went to Wharton. If they were Black, they were the one Black person in their class, and some of them proud of being the only Black person there and not bringing more Black people into the space. And so in those cases, they suffer from the same challenges that white founders do. The only thing they don’t suffer from in terms of other white venture capitalists is some of them will still hold true to their worldviews and where they came from, and so they’ll be able to meet some Black founders in spaces where other people can’t by the sheer nature of where they came from. But if you came from the upper middle class, you went to HBS, and you’re a VC, and you did this before the year 2020, it’s very unlikely that you move any different than a white venture capitalist. And I kind of wrote about that in the Harvard Business Review when I discussed the 4 challenges that the current VC establishment has to investing in Black founders. Because right now, you are seeing a pickup in the number of people who will have the meeting. People are opening networks and making more introductions. But ultimately, the meeting has to lead to a check. But the meeting can’t lead to a check because there’s intrinsic reasons as to why that people is not becoming convinced to actually write the check. And those are things that take real personal work to shift.

Aoifinn Devitt: And we can put a link to that article in the show notes. But was there anything— any other barriers that you can name in that?

James Norman: It’s easy. It’ll take me 30 seconds. There’s 4. There’s different markets and different solutions. So that means I came from a different worldview, and I see a market opportunity that’s not apparent to you who doesn’t come from the same place. I have a different solution to a common market. I’m approaching this in a way that is not commonly being approached. The average VC has a pattern that— which that does not fit. And so out the gate, you’re discounting the value of my market, which is super important when I’m having an initial conversation at the early stages. Then there’s different surroundings and different resources, meaning that we don’t have friends and family rounds, and we’re not around other people who might join an early-stage team. So 94% of Black founders specifically are solo founders. Then you have different communication. Because we actually have, literally every Black person has a professional version of them and a personal version of them. And they use two different language and they interact with the world in different ways. And it’s just how we were brought up here in the US. And so because you bring only your professional self to that table, they’re missing the personal side of you. And some of the words you’re using aren’t landing on them because you speak differently than other people they’ve met. And so in combination, they don’t feel a connection towards you in a lot of cases. And that personal connection and the value of the market are the two biggest things that are actually driving people writing checks at the pre-seed and seed. And all that is underlied by unconscious bias because they don’t know why they’re not connecting. They’re not making an effort to connect with someone who’s not exactly like them. So it actually takes mental cycles and effort. And that is something that some people are now putting in, so it’s helping alleviate some of the bias.

Aoifinn Devitt: Really interesting. I would have to think that some of the part— the last problem, the lack of personal connection, Some of that will change as the venture community becomes more diverse, perhaps the new generation that hasn’t invested prior to 2020. Hopefully that, uh, those alliances can build. Just moving from there to talk about your work at the Transparent Collective, which I know is, is dedicated to increasing exposure and access to Silicon Valley. Can you talk about that work?

James Norman: Yeah, Transparent Collective started in 2015, basically me and another friend of mine who I grew up with since I was zero. We went to different high schools and did different things. He was more of an athlete. Like I told you, I’ve been selling stuff for a long time. So we had two different things we were doing as kids, but like similar parents, both social workers, like similar values that, you know, we came up through life together, the entire life. Like went to University of Michigan together, both did engineering, both worked in the automotive industry. I came out here before him. I put him on. He moved out here to Silicon Valley. Both went to the same program, got introduced to the same networks Combined, we had the most robust network in Silicon Valley. We couldn’t raise money for our companies. We were like, this is impossible. And so we were like, we need to do something to create a program where we can at least extend our network, extend our knowledge, and get more people in the space so people have to start writing checks. So that’s how Transparent Collective came together. And that program now runs a week long for each batch, usually 8 to 10 companies. And it involves storytelling strategy, pitch deck development, fundraising strategy, product strategy, legal and human resource development, legal strategy. And then it culminates in a demo day where we curate a set of investors. The real numbers of how much we’ve gotten for funding for these founders is a little bit vague to me because on Monday I heard the number $80 million, and that is a lot more than where we were at last year. But the numbers I do know to be true is we’ve helped 52 companies raise over $42 million in early-stage funding. And we basically, specifically for Black founders, have alleviated the issue of getting pre-seed funding. If you have a company that is going to be big, we can get you pre-seed funding. Like, that is almost guaranteed at this point.

Aoifinn Devitt: Fantastic resource in the ecosystem there. Looking back at your own career, whether it’s— and you, as a serial entrepreneur, I’m sure you’ve had many setbacks, many challenges, and many mistakes, perhaps either with trusting people or with investment ideas. Can you talk about any lessons you learned from them?

James Norman: I got a million lessons. Anybody who’s not learning from failing isn’t really doing anything. I think the co-founder thing is important. You know, understanding if you’re going to have a co-founder, what that relationship’s going to be like, and understanding that if you’re going to be the CEO, it’s not just about product vision and being good at selling said vision and building a product. It’s also about building a team. A team’s not just about hiring people, it’s about understanding people’s competencies, where they’re strongest at, how to deal with them when they’re not performing well, how to help them connect with other people on the team, how to build a community within your company. I don’t think that’s taught a lot, but, you know, I don’t think a lot of our counterparts have to learn that because they have so much money that they can just hire and fire people like it’s nothing. You know, that’s why you end up with these companies that have terrible corporate cultures, a bunch of people who don’t really stay in the company, have to constantly stay on top of hiring and find the best talent. ’cause they didn’t really build something that was sticky in the beginning ’cause they had the resources and they didn’t have to worry about it. For underrepresented founders, it’s super important to build a robust team that can see through the ups and downs because we might not have the same amount of funding for quite some time. That’s one thing I learned. I also learned that I’m very confident in my personal skillset. Everybody will tell you that, but I have that level of confidence ’cause the amount of time I put into it. I initially had this belief that anybody who put in the time could do exactly what I could do. And that’s not true. And it leads to, like, miscommunication and poorly set expectations on people. And again, it goes back to, like, being a proper CEO. Like, if everybody could put in the time and do what you do, they’d be the CEO. Like, that’s just the facts. And I didn’t realize that, right? So that was, like, a come-to-Jesus moment for me as well, like, where I had to start seeing people for what they were and not what they could be because I have no idea what their aptitude is to achieve, and I can’t compare it to mine because I’m a different type of person. When you go to investors, I’m gonna say underrepresented people, specifically Latinx and Black, aren’t used to asking people for money. And so before, I remember, I think my friend Arjun, who I still talk to all the time, he was my mentor at 500 Startups. Someone like him told me, you gotta ask for the money. I was like, oh wait, what do you mean? So I go pitch them thinking like, we’re here to get, like, that’s the whole point of this interaction, right? And so like, I’ll never forget when I went to pitch my first VC after having these conversations and strategizing, I’m getting ready to go raise a little bit of money for Pilotly. I pitched this guy who I’d been talking to, getting UX feedback. We sit down and he’s like, “All right, that’s interesting.” I was like, “Cool, man, is it interesting enough? Is it something you think you could get behind?” Like, that was my way of saying, “Are you gonna give me money?” Instead of like, “Are you, would you wanna invest?” Like, that’s like too forward. And I’m like, “Is this something you and your team could get behind?” He’s like, “I think so. You know, I think I will get a personal check in. I think I can get the team to put in some money. I’ll come back to you.” And I was like, oh, wow. I asked and he gave me money, right? Everybody else, white people are asking for money, ’cause it’s okay. It’s normal. It’s part of their life. That’s something you have to come to terms with, like making the ask and being comfortable with it and coming into a room knowing that you have value. So, like, a lot of times, you come as an underrepresented person, you come into a room with a certain chip on your shoulder to prove that you belong there. And that’s kind of what’s going on in a pitch in a sense, right? You’re trying to show them that your company is worth investing in. But it’s a different type of energy when you’re actually trying to prove yourself, right? You’re not trying to prove the company, you’re trying to prove yourself. It comes across. And so it can come across as, I don’t know, I don’t know if this guy really needs the money. The people who other people are pitching, people have no need for money. They could get no funding and be like, ah, whatever, I’ll sleep on the couch. I’ll get a job at Google in a month. I’ll come back and do it again. Like, there’s a different energy that comes across in the room when you do something from a standpoint of necessity versus a standpoint of luxury. And most of us are doing it from a standpoint of necessity. You have to find your in-between, you know, and know your safety nets. That’s just what it is. Like, you have to bring yourself to a room, not arrogantly confident, but enough confidence that you believe what you’re doing is gonna work and I’m going to do it, like, no matter what. You know, I just think you’d be good to partner with on this. If I had this capital, I could do this. I’m going to do this anyways, but I could really do this if we got together on this, you know, and someone could say no to that and I’m going to keep existing. It might not even be true. You might not even still exist if they don’t give you the money, but you have to come in with the attitude.

Aoifinn Devitt: So interesting, because as you’re depicting that scene and that kind of mindset, it’s not dissimilar from what I think a lot of women feel, Black and white, when they go into situations where they’re underrepresented. There’s that concept of feeling grateful, feeling grateful for being in the room at all, for being in the interview at all, not asking, not making the ask, certainly not asking for appropriate pay package. And I think, and then as you mentioned, then these differences persist and they compound and it becomes an even, there’s even more of a gap. So I think it’s very, very interesting.

James Norman: We have a number of women on the Transparent Collective team because there’s an aspect to that that I as a man could never even conceive, right? Because I never experienced it. But one thing I do know that I try and put in the minds of female entrepreneurs is have conviction. You know, because women will be like, well, I think this, you know, we’re really hoping for that. You know, like, like, no, no, no, I’m going to do this. And that is what’s going to happen. And that’s the end of the story.

Aoifinn Devitt: I was going to ask you about how you train people to change their mindset. And it seems that it is possible in your experience to get that mindset to change, is it?

James Norman: Yeah, but it’s important to have someone who looks like you to do it.

Aoifinn Devitt: Right.

James Norman: Like, because otherwise they’re not going to be able to say the right things. In addition to that, the person will have a little bit of dissonance to actually connecting with what you’re saying. It will take them longer to pick it up. And then on top of that, it’s unlikely that you’ll have all the right information because you haven’t had the same experience.

Aoifinn Devitt: Very interesting. And looking back at your own journey, were there any key people there who really influenced you and maybe put you on a different path or just left their mark in some way?

James Norman: A million. Like, I mean, I could just list them off. I mean, my friend Martin, who I grew up with, I wouldn’t probably be doing this if it wasn’t for him because any crazy idea I had, he’d be like, I’m with it, let’s go do it. Like anything, like building websites, selling this stuff, going to sell bootleg CDs at school, like whatever we were gonna do, he’s with it. He’s there as my like co-founder. That person initially is my co-founder. I honestly didn’t even realize that till now. That’s what a co-founder can do with you when you’re early on in this process of understanding how to run a company is be there for you no matter what. So, like, that just has some level of importance. Drew had an impact on me ’cause that’s how I decided to go start doing tech startups. My buddy Joe with MIT kind of fits the typical mold of what a, you know, person in tech would be like, but has been, like, my best friend for over decades, I guess, now. He introduced me to what white privilege looks like. The way he would articulate how he felt and the way he would push things across the finish line, the way he’d see what I’d say and be like, No, man, like, you’re better, you’re bigger than that. Like, let’s do this. You know, like, he always saw, he always saw, like, things that were beyond what I even thought I could do. So that guy is important. Then you have, like, you know, Wayne Sutton, Angela Benton made the NewMe program, which brought most of the Black people who are doing things out here in tech. There’s some high percentage of them that came from NewMe, high percentage. And so that program was super important, and that program led me to meet people like Mike Seibel, who told me my deck was garbage. That was the first time I realized I don’t know what I’m doing in terms of building a deck for Silicon Valley. You had Ben Horowitz, who was early on starting Andreessen Horowitz and brought us over to his house and just broke down things to me and helped me when I was trying to get IP acquisition offer early on for Ubi. Then, yeah, I think the last piece of that puzzle is the team over at 500 Startups because the landscape has shifted over the past 5 years. When I first started doing this, there was less than 100 Black people that ever received venture capital. Then when I started doing, like, started my next thing that pivoted to Pilotly, there was less than 200 who had ever been funded. So this is still an ultra-rare thing. You had to have a 500 Startups or Y Combinator write you a check for you to have a chance of getting any money. Like, that’s just kind of where the landscape was at. And so 500 Startups was super important to me having an opportunity to even get measly funding to bootstrap my company basically now to where it is. You know, all those things are super important kind of in my trajectory.

Aoifinn Devitt: And out of all those very inspiring people you’ve listed, was there any key piece of advice that you really held on to, or any creed or motto that you live by?

James Norman: I think it all— all the words come together, but I would say that I, one, learned not to take the investment conversation personal. Underrepresented founders are putting so much of their personal life on the line and doing this for such a point— it is so meaningful to how we live. Again, we’re not living off of some random family funding or anything. That when you take something— you’ve seen your counterparts do this. You’ve seen your counterparts pitch. You’ve brought MIT people in the room with you to see what’s going on. They’ve been in the other rooms. And they still don’t give you the money, it can hit you personally. And that energy comes off in the room. And it can be combative. And it can be negative. And it’s not going to get you the funding. And so, like, I think coming to terms with the fact that it’s not personal, they just can’t see the opportunity that I have, is a big mind shift. And working to help them see the opportunity, as opposed to being mad at them that they can’t see it. And then for me personally, more on a spiritual level, looking back at my life and what I’ve done and all the failures I’ve had and what it’s led me to, it has made me this expert that can sit here and talk with you. So there’s a reason why there’s not too many other people you could talk with and have this conversation, ’cause you would have gone through it. You had to have gone through it to have this kind of perspective on the landscape and on what it is to be an entrepreneur and being underrepresented. And so all of that was important for me to be in a position to help other people like me. And so I think that was always my end goal, but I knew the end goal required money, but I had my energy very focused on the money. And I refocused my energy probably 5 years ago on the people, and that’s where Transparent Collective started. And the money comes in between, because when you’re helping people raise millions of dollars and you’re helping VCs get rich, you’re helping other people who’ve been blocked out from backing or representing founders understand what they’re missing out on, how they get there, then you become an important person. And with importance comes access to the power and access to the resources that you need to make the change that you think is most important, right? People know you know how to make the change and they’re going to put the money in your hands to make the change. You can talk about making change all day, you can get the money and then you can’t make the change because you’re not really plugged in. You never really helped the people, you don’t have a track record, you don’t know what the framework looks like. Now you got to figure it out. But if you figure out how to help the people and you put your energy there, then the resources will come.

Aoifinn Devitt: That’s, that’s some really inspiring words there. And my last question is around any advice you would have for your younger self. You don’t have to go back to the video games over the fence stage, but maybe your University of Michigan self.

James Norman: Know what you’re best at and learn to build teams of people that are better at other things than you. Because I always got ideas. Ideas can only go so far with like one person at the helm.

Aoifinn Devitt: Well, thank you so much, James. This was a really powerful conversation, and I think you’re really embodying the epithet I’ve heard on this podcast before, which is to lift as you climb. I think your commitment to doing that is just so inspiring. Thank you for coming here, for sharing your insights. I reached out to you because of something you’d written, which I came across when I was researching the series. I’m going to put everything you’ve written, links in the show notes, and hopefully, that’ll be helpful to a whole new generation of founders. Thank you so much for sharing your insights with us.

James Norman: Thanks so much for having me.

Aoifinn Devitt: I’m Aoifinn Devitt. Thank you for listening to the 50 Faces Podcast. If you liked what you heard and would like to tune in to hear more inspiring investors and their personal journeys, Please subscribe on Apple Podcasts or wherever you get your podcast. This podcast is for informational purposes only and should not be construed as investment advice, and all views are personal and should not be attributed to the organizations and affiliations of the host or any guest.