Ep. 22 Navigating Venture Capital: Funding Pathways for Black and Brown Entrepreneurs

9/10/24
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Welcome to the DO GOOD X podcast, where hosts Kimberly Daniel and Stephen Lewis engage in powerful conversations with changemakers who are redefining impact in the black and brown community. Today, we're joined by Rachel Wilson from the BFM Fund, a venture capital firm dedicated to empowering black and brown entrepreneurs. Rachel dives deep into the world of capital access, sharing invaluable insights on how to secure funding for black startups—a challenge many founders face. From navigating private equity and understanding the capital stack to leveraging debt products and bootstrapping, Rachel breaks down the complex language of venture capital. She also highlights critical resources like the African American Association of CDFIs, and initiatives such as SEDI, SSBCI, and SBIR. Whether you're at the seed stage or planning your exit strategy, Rachel's expertise offers a roadmap for wealth generation and sustainable growth in the entrepreneurial ecosystem.

In This Episode

  • [4:25] Rachel reflects on what led her to the venture capital space
  • [7:09] Rachel defines private equity and venture capital and the conditions necessary to obtain it
  • [14:46] Discussion regarding a profile of what a seed stage venture looks like to obtain capital
  • [21:14] Discussion regarding exit strategy, which is a necessary component of obtaining venture capital
  • [32:29] Rachel shares resources and support systems for black founders in the early stages of launching their businesses
  • [37:53] Rachel discusses other resources available to understand the language of obtaining capital and she gives advice to entrepreneurs who are VC ready

Key Takeaways

  • When you hear the word venture capital, it is about: having a business that can be innovative, can take over a particular market or be able to control a specific aspect of it, get some market share and be able to exit in a time frame so that people who have put money into your business can get some type of return through a liquidity event.
  • Essentially venture capital is a business in itself. It's people trying to find businesses that can flip themselves for a return of a minimum of three X.
  • The investment process is a two-way street. Make sure you have vetted your lender to ensure they have the same goals and objectives you do.

Resources

Guests

Rachel Wilson

Rachel brings over a decade of diverse global experience spanning multiple industries, including Food & Beverage, Automotive, Tech, Healthcare, Music, Fashion, and Media. As managing partner of the BFM Fund, she orchestrated the fund's operational and governance processes. She recently led operations for Collab Capital, a diverse-owned fund with an AUM of $50M. Rachel's role encompassed investor relations, fund reporting oversight, impact metrics strategy, and comprehensive governance responsibilities, including legal and HR management.

Rachel has a B.A. in Economics & Business from Agnes Scott College and an M.S. in Industrial Engineering from the Georgia Institute of Technology. Her commitment to fostering diversity and inclusion in the venture capital landscape is evident through her involvement as a Black Women in Venture Capital (BWiVC) board member, a nonprofit dedicated to supporting careers and access to capital networks for its 300+ members. She is recognized as a NAIC Women in Alternatives UP Fellow and Co-Lead for Living Cities Inclusive Capital Council.