Stories
Stories
Capital Considerations for Black Entrepreneurs; Pivoting for Gender Equity
Clubs News
As second-year students at HBS, Kimberly Foster (MBA 2020) and Tyler Simpson (MBA 2020) created the inaugural Black New Venture Competition (BNVC) to help Black tech founders find investors. The event attracted 300 applicants and became the largest student-led business plan competition for Black entrepreneurs in the U.S. But as the competition progressed, Foster and Simpson began to identify some biases and frictions in the evaluation and funding of early-stage Black ventures.
Those challenges, as well as the successes of the BNVC became the basis of the 2020 case, “The Black New Venture Competition,” written by HBS faculty members Karen Mills, Jeff Bussgang, and Martin Sinozich. The case is also the basis for the HBS course, Scaling Minority Businesses, which Bussgang co-teaches with Henry McGee and Archie Jones.
Jeff Bussgang, Yasmin Cruz Ferrine, Glynn Lloyd, and Karen Mills
On September 30, Bussgang and Mills presented this case to more than 80 HBS alumni in a virtual panel discussion that explored what the BNVC got right, what it exposed in terms of bias in the VC ecosystem, and what needs to change. The discussion also featured guest panelists: Yasmin Cruz Ferrine, General Partner of Visible Hands VC, and Glynn Lloyd, Executive Director at The Foundation for Business Equity. Through their respective organizations, these entrepreneurs are redefining the way Black and female founders access capital.
“We wrote this case because it not only tells a particular story of two student leaders effecting change,” says Bussgang, a Senior Lecturer at HBS and managing partner at the VC firm, Flybridge. “But it also speaks to larger systemic issues and points a very bright light on a market failure in the startup and tech ecosystems. I think the HBS community is particularly well-suited to be a problem-solver here. We have so many leaders in VC, startups, and entrepreneurship. Our alumni network literally runs the largest venture capital firms in the world.”
Mills (MBA 1977), a Senior Fellow at HBS and the former Secretary of the U.S. Small Business Administration (SBA), opened the case discussion by asking what the BNVC creators had done well, and what they could do better. This sparked a robust conversation that revealed a VC ecosystem rife with unwritten rules, an acknowledged “clubby” exclusivity and a lack of clear funding pathways for outsiders, in particular, Black and women founders. A variety of solutions were considered, including Glynn’s approach to funding via public grants, and Ferrine’s approach at Visible Hands VC, which offers Black and women founders a 14-week fellowship that connects them with mentors and money to build their companies.
Mills thanked attendees for engaging with the case, and for understanding the many barriers that exist as well as the difficulty for Black founders to get funding. “The positive side has been to watch this BNVC come to fruition out of the minds of two second-years and watch the next students take it over and take it to the next level and bringing hundreds of black founders to HBS,” she said.
And while there’s currently a “case-writing storm featuring Black protagonists at HBS,” Bussgang adds, “we’ve got a lot of work to do, but a lot of people are doing the work.”
While hosted by the HBS Association of Boston (HBSAB), the event was presented in partnership with the HBS Club of Chicago, the HBS Club of New York, the HBS Association of Northern California, and the HBS African-American Alumni Association, says HBSAB Board Member John Carrier (MBA 2000).
“This is a topic that many of our members are very interested in,” he says. “It was such a great case and everyone engaged with it.”
HBSAB President David Harris (MBA 1984) adds that engaging and informative events like these “really help our alumni envision what they can do to make a difference in the world.”
A recording of the case discussion is available here.
More than 50 alumni and guests gathered virtually on October 6 for a talk by HBS Professor Emerita Lynda Applegate, Pivot for Equity: Lessons from Melinda Gates’ Pivotal Ventures, based on her 2020 case, “Pivotal Ventures: Bending the Curve on Women’s Power and Influence.”
The HBS Club of Connecticut (HBSCT), together with the HBS Club of New York (HBSNY) and the HBS Women’s Association of New York (HBSWANY), presented the discussion in partnership with the nonprofit Girls With Impact to explore how Pivotal Ventures, an investment and incubation company, is using philanthropic and investment capital to fund innovative startups and nonprofits working to achieve gender equity in all areas of society.
Applegate, an entrepreneurship expert, broke down the steps that Pivotal Ventures has taken to “bend the curve” with gender equity, including developing an ecosystem model, managing risks and measuring the impact of investments.
Lynda Applegate (Photo by Neal Hamberg)
To open the case conversation, Applegate read a quote by Melinda Gates: “For all of history, women and girls have been relegated to the margins, denied an equal chance to learn, lead, earn, thrive, and rise. Even today, there is nowhere on earth where women have achieved true equality. Now, the world is finally waking up to the fact that none of us can move forward when half of us are held back. The data are clear: Empowered women transform societies.”
The discussion was moderated by Jennifer Openshaw, a MarketWatch columnist and the CEO of Girls With Impact, which she co-created with Applegate. Girls With Impact teaches girls ages 14 to 21 business and entrepreneurship skills in a “mini MBA-style” academy.
“If we want to move the needle and transform lives, communities and our economy, we have to start younger,” says Openshaw. “The ROI is tremendous.”
After presenting the data on gender inequality, including the World Economic Forum’s 2020 report stating that under current global conditions, women won’t achieve equality for another 208 years, Applegate used frameworks to illustrate Pivotal’s progression toward its stated goal of gender equality by 2030. After detailing Pivotal’s investment in Techstars, an entrepreneurship accelerator for women, and Elevest, a digital investment platform for women, Applegate pointed to Girls With Impact’s goal to “bend the curve” by training a million young women.
Openshaw, a one-time motel maid turned Silicon Valley entrepreneur, explained the impetus for Girls With Impact.
“At just 16, 17, 18, these young women are transforming their confidence and graduating with real business plans in tech, climate change and other growing areas,” she said. “By harnessing technology, we can meet students where they are and deliver a powerful business education — designed with HBS leaders — at a fraction of the cost of what a family would otherwise pay to help their daughter advance. It’s incredibly exciting to have Lynda and HBS a part of this effort to give under-resourced women and girls a real leg-up.”
Post a Comment
Related Stories
-
- 19 Apr 2024
- HBS Clubs
Alumni Host Energy CEO Summit in Houston; Austin Club Co-Hosts SXSW Reception
By: Margie Kelley -
- 21 Mar 2024
- HBS Clubs
OC Alumni Get Clarity on AI; Inequality and Climate Change Explored in DC
By: Margie Kelley -
- 22 Feb 2024
- HBS Clubs
GCC Crossroads Aims for a Bright Future; Seattle Alumni Talk Leadership in Tech; Italy Preps for European Alumni Summit
By: Margie Kelley -
- 25 Jan 2024
- HBS Clubs
Alumni Gain Insights on Nigeria’s New Government; Taipei Alumni Host Faculty Guest
By: Margie Kelley