All Articles Tagged "venture capitalists"
Despite an increasing level of development in African American entrepreneurship, venture capitalists have yet to show real interest. A CB Insights study show that for the nine percent of all new entrepreneurship activity in 2011, less than one percent of venture capital investment went to African American-owned digital start ups. In the Huffington Post, Darrin Redus, Jump Start Inc’s chief economic inclusion advisor says that it’s up to local communities across the country to foster a greater sense of inclusion for entrepreneurs attempting to secure financial support. But how can communities help build venture capitalist interest and financial support for minority entrepreneurs?
First, they can begin to connect with executive directors and presidents of minority technical and professional groups which are steadily growing across the nation. These organizations include the National Society of Black Engineers and The American Association of Blacks in Energy. A close connection between these groups and leaders in the mainstream will assist in developing the connections and relationships needed to form tech start-ups.
Next, communities can propose educational and awareness-building conference with stakeholders. Redus notes a national Minority Biomedical Entrepreneurship Conference held last May in Cleveland, Ohio which helped promote African American and Hispanic innovation in biomedical entrepreneurship.
Communities can also promote access to capital for minority groups instead of to big corporations and white-owned businesses that generally receive the funding.
Another idea to help foster minority tech-start ups, is pilot programs. Pilot programs allow entrepreneurs to test their new products, technologies and services with established regional and national organizations. If the pilots are successful, then these organizations become the partners and customers of these new products.
Communities should also attempt to build relationships with historically black colleges and universities, specifically in technology. Reaching out to minority alumni associations also assists in fostering these connections.
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In Silicon Valley, black faces can be hard to spot in the pool of entrepreneurs. And the African-Americans that do make attempts at starting innovative business often encounter lack of funding. It’s what entrepreneur turned venture capitalist Mitch Kapor calls “mirror-toracy.” He tells The Bay Citizen that business professionals tend to finance people who look and act like them as they fit their image of success. African American aspiring entrepreneurs are left out, and desperately need the resources and financial backing to get them started. That’s one reason why Angela Benton founded the New Media Entrepreneurship Accelerator, (NewME).
Benton, previously based in Charlotte, NC, realized the disparity in African American entrepreneurs when she took a visit to the Google Headquarters. She held a mixer for black entrepreneurs and was amazed when 100 people showed up, excited to meet other like-minded individuals. Although a report from CB Insights, a venture capital information database, observed that less than one percent of the venture capital-backed tech companies in California were started by blacks, the desire and the people were there.
Benton realized that there was a need for a community to support black entrepreneurs, but no one had thought to create it. These future business leaders simply needed an incubator and a community to nurture their business ventures.
Similar to other incubator programs, NewME provides resources and networking opportunities to potential business owners. In its first workshop held last summer, NewMe had eight participants, three of which are now starting up business in Silicon Valley. Two others are looking to start their business elsewhere.
“We need 10 NewMEs,” Chad Womack, a co-founder of the America 21 Project, said to an audience of black professionals in San Francisco. “We need to clone Angela and spread her around the country, if we can.”
America 21 works to encourage African Americans to take on technology business as a way to earn wealth. The non-profit groups plans to create opportunities for inner city youth with the help of the White House and hopefully initiaitves such as NewME.
Benton said she is now planning to hold a 12-week follow-up program in the spring. This time, the requirements for participants will be a bit stiffer and more in line with other incubator programs. All must commit to giving NewME four percent of the company’s equity.
(WSJ.com) — Much has been said about the Obama administration pushing through new regulations on everything from health-care companies to banks — not to mention the impact these changes will have on the overall economy.
But less attention has been paid to the way the new regulations will play out for entrepreneurs: Will stepped-up regulation stifle or stimulate growth? SmartMoney spoke with business owners, venture capitalists and analysts for a snapshot of six industries poised for growth.