Even two years after George Floyd’s murder prompted a cross-industry reckoning around institutional racism — which, in turn, fueled diversity mandates and equity initiatives throughout the economy — for founders of color, the DC startup ecosystem remains an unequal playing field.
These founders still have to navigate extra costs that their white counterparts don’t experience. Luckily, some individuals in the entrepreneurship scene are well-positioned to help.
Alexander Knight, the senior VP of business development at entrepreneurial law firm Cooley LLP’s DC office, specializes in working with underrepresented founders in this ecosystem. Knight’s work focuses on three pillars for creating real change in support of marginalized founders: access to capital, diversifying the venture capital ecosystem and diversifying the boardroom. He spoke to Technical.ly about his overall thoughts on the scene, how the DMV can better support underrepresented founders and what the last two years might portend for the scene’s future.
This conversation has been edited for length and clarity.
Technical.ly DC: Tell us a little about you and the work you do at Cooley.
Alexander Knight: A lot of what my team does is help connect founders, our current clients, with connections to investors, as Cooley represents about a third of venture capitalists. So, strong relationships on the capital side, and we’re able to help play connector for our clients that are gearing up for a fundraise when that time comes.
But it’s also just the various needs that come up within a company’s lifecycle. It’s getting them plugged into great accelerator programs, and these tend to be geared towards more first-time founders that are less connected to the ecosystem. It’s helping them find great mentors, advisors, board members and C-level hires — again, just those various needs that could come up within a company’s lifecycle.
I have this overlap in all things [related to] diversity equity, and inclusion. I’m focused on the marketplace externally, meaning: How is Cooley being more intentionally supportive to Black, Brown, women, other underrepresented minority founders, investors and general counsels? That, and the unique opportunities and challenges that they’re facing, guide my everyday work.
TD: Since a huge part of your work is connecting, who are some specific power players and organizations in the DMV that you think are doing great work in this sphere?
AK: The first one that comes to my mind is Melissa Bradley with 1863 Ventures, she’s absolutely crushing it. And she’s also building Ureeka, the platform that’s creating lots of great resources for underrepresented founders.
Adeleke Omitowoju, who used to be with 1863 and is now with the Black Venture Capital Consortium, he’s another incredible thought leader that’s also now on the capital side of things. I think [he is solving] many challenges, including helping equip Black investors with the tools they need to grow and succeed.
Blck VC is just another great organization that is national, but they have a local chapter model. Nasir Qadree is one of the local chapter heads, as is Maurice Boissiere, who is also a local investor at DataTribe. He’s worked with a couple of great DC-based companies.
TD: How do you feel that DEI initiatives have progressed over the past two years? A lot of companies issued mandates in 2020. Do you feel like there’s been progression there?
AK: From my five years of connecting with founders in this space, I would say that there’s probably never been a better time to be a Black founder or a Black investor. And you can probably say that about most underrepresented groups.
I say it’s the best time because: Particularly over what’s happened in the past two years, with companies that are creating carve-outs and organizations that are launching accelerator programs, there’s never been more of them. [That’s even the case] on the investor side, for these emerging fund managers.
There’s also much more data to support that creating a more equitable, diverse venture ecosystem is also creating a more profitable diverse ecosystem. And for me, that’s a very important piece of it because it distinguishes the idea that this isn’t charity, this is so much more than charity. When organizations like Bank of America are creating a $200 million-dollar carve-out for Black and Latinx fund managers, it’s not a handout, it’s with the understanding that having at least one woman on an investment team at a fund is driving 10% more profitable exits. So there’s more data to back up the fact that there is profitability and there’s business sense behind investing in new majority founders and investors. That, to me, is an encouraging piece.
TD: What are some of the challenges that still exist for these startup founders, particularly in the early stages?
One of the challenges that exist now that maybe didn’t exist three or four years ago, is the idea that because they are more of these programs, the accelerator programs and incubator programs, there needs to be more discretion from the founder side and figuring out: Where will I get the most value? Now, they’re faced with choices and different programs that they could jump into locally.
As more of these programs grow, I think some of them are perhaps less helpful than others. One lens to which I’m trying to vet some of these great programs, separating great from perhaps best, are ones that are actually writing checks. Ones that are actually investing in companies in addition to the educational tools that are being provided. I just think underrepresented founders tend to be over-educated and under-resourced as it relates to financing.
It’s costing underrepresented founders $250,000 more to get started, and you tack on top of that the fact that they lack, generally, the historic network to be able to write friends and family checks to get them supported and off the ground at an earlier stage. Those two challenges have created this real sense of need to, yes, have the education, but also make sure we’re investing in these companies as well.
TD: What would you like to see from the DC tech and entrepreneurship scene as a whole in its support of underrepresented founders?
I’d say more success stories. We have a role to be sharing the incredible stories of the incredible capabilities that local companies here are building. But I just think underrepresented founders, specifically, have been historically left out of that piece.
More successful exits, as well, from companies — that’s something that I’m keen to see because that has a ripple effect on the ecosystem. Generally, successful founders tend to either continue building, build a new venture or invest in the next generation of founders within the ecosystem that they came out of. Maybe they start a fund, maybe then angel invest.
But I think [the] more and more successful exits that we’ll see out of DC, the more we’ll see this sort of reinvestment back into DC. And I think that’s particularly important with underrepresented founders.
TD: What’s one piece of advice you’d like to give to founders of any stage?
Be curious. Even specifically as it relates to underrepresented founders, it might feel like they need to have everything together in order to get the checks, in order to get into the programs. But really, it’s being curious, it’s asking: What’s the value that you can bring to me? Being curious, that’s going to get you into the right circles, that’s going to get you into the right programs.