As we move into a different fundraising landscape I worry that less of these type of truly scrappy entrepreneurs won’t get funded.
Joanne Wilson, Off The Grid Entrepreneurs
The whole Peter Thiel insults Chicago thing seems to have me riffing on diversity. No discussion of the topic in the context of entrepreneurship and venture capital would be complete without a nod to Joanne Wilson (aka Gotham Gal). Since 2007 Wilson has been making angel investments with a focus on female founders. I love what she says on her web site about why this is her thesis;
I have also focused my thesis on female entrepreneurs — a decision that is more practical than philanthropic. Women founders tend to be tenacious and thorough. They ask questions and listen. They are great leaders.
I don’t know Joanne Wilson or Arlan Hamiliton. But from a distance it appears that they don’t have much in common except their gender and passion for investing (and maybe music if I’m reading their bios correctly). And that’s the beauty of it. They each bring their own individuality, their own history and experience to investing in start-ups. Each of them will find opportunities they are uniquely qualified to make.
Wilson brings up a tough point, however. She points out that off-the-grid entrepreneurs who don’t know how to play the game and speak the lingo face higher hurdles as the funding environment. Investing in diverse, off-the-grid entrepreneurs takes not just a unique perspective and some guts; it takes more time. And there in lies what may be the biggest challenge facing diversity in venture capital. Entrepreneurs who don’t know the system take more time to work with and that creates a challenge for VCs. Now I’m not naive. There are certainly venture capitalists that are racist, sexist, and won’t invest outside of three zip codes. This is not a trivial problem. It’s an epic problem as large and old as humankind. But I do believe that most venture capitalists are well meaning, genuinely good people. They are trying to do their jobs as efficiently and effectively as possible. That’s hard when a prospective entrepreneur doesn’t speak your language. I don’t speak Chinese and nobody expects me to be very effective at making investments in China.
If VCs want to benefit from diverse investments and off-the-grid entrepreneurs want to play the venture capital game, then both need to adapt. Both need to invest more time. Both need to do uncomfortable things. In some cases, translators may be needed. I love traveling and doing business internationally. It’s hard and uncomfortable at times. I need translators and guides. But the reward is huge. Venture capital needs people like Joanne Wilson and Arlan Hamilton for the industry to reap the huge rewards available in our diverse, global economy.