WEBVTT - Getting More Black Companies Past Series A w/ Elliott Robinson 0:00:00.080 --> 0:00:02.360 Season two of the Black Tech Green Money Podcast is 0:00:02.400 --> 0:00:05.640 brought to you by Lexus, who's been celebrating driveway moments 0:00:05.760 --> 0:00:08.320 for over thirty years with a Lexus December to Remember 0:00:08.360 --> 0:00:11.040 Sales event, where you can find exclusive offers on the 0:00:11.080 --> 0:00:15.319 most popular Lexus models. Experience Amazing at your Alexis dealer 0:00:16.960 --> 0:00:22.640 Afro Tech World. Will Campbell, the CEO at Quantity and 0:00:22.680 --> 0:00:27.320 Associates and award winning creative agency, He's on the virtual stage. 0:00:27.360 --> 0:00:30.880 He discuss how M and A mergers and acquisitions can 0:00:30.880 --> 0:00:33.680 play a pivotal role in helping you grow your business 0:00:34.040 --> 0:00:38.519 and achieve your vision. I want to talk about why, um, briefly, 0:00:39.080 --> 0:00:43.599 mergers and acquisis, since we're so important, especially for boticultural 0:00:43.640 --> 0:00:47.879 companies and for the black businesses, is we need to 0:00:47.960 --> 0:00:53.880 create larger, more influential companies. So you might say, as 0:00:53.920 --> 0:00:58.640 an entrepreneur or a founder, UM, hey, you know, my 0:00:58.760 --> 0:01:03.480 goal is not to be some massive company. UM. I 0:01:03.520 --> 0:01:06.399 really just want to pursue my passion. You know, I 0:01:06.440 --> 0:01:10.280 really want to just Um, if I could change one life, 0:01:11.160 --> 0:01:13.640 I've done my job. UM, I just want to make 0:01:13.680 --> 0:01:17.240 something that's right for you know, my family. And that's 0:01:17.319 --> 0:01:22.160 all great, but at the same time, the business community 0:01:22.560 --> 0:01:26.840 needs you. We need your ideas, we need your hustle, 0:01:27.200 --> 0:01:32.240 we need your innovation, and we need you to create larger, 0:01:32.800 --> 0:01:37.000 more influential companies. Um no matter what type of company 0:01:37.040 --> 0:01:40.280 you are, is it helps you deepen the capacity that 0:01:40.400 --> 0:01:45.679 drives your mission. UM So as a visionary, as a 0:01:45.720 --> 0:01:48.920 person with an idea, M and A can become an 0:01:48.920 --> 0:01:54.440 incredible growth strategy that gives more capacity, of more foundation 0:01:54.960 --> 0:02:00.360 to what your overall mission is. I'm with Lucas Mrs 0:02:00.400 --> 0:02:03.320 Black Tech, Green Money. I want to answer this you 0:02:03.360 --> 0:02:05.360 to some of the biggest names, some of the brightest 0:02:05.360 --> 0:02:08.720 minds and brilliant ideas. If you're black, in building or 0:02:08.760 --> 0:02:11.960 simply using tech to secure your bag, this podcast is 0:02:12.000 --> 0:02:20.639 for you. Elliot Robinson his partner at best Mere Vented Partners. 0:02:20.880 --> 0:02:24.400 He has fifteen years of international experience investing and partnering 0:02:24.440 --> 0:02:28.320 with world class entrepreneurs and the technology companies that they lead. 0:02:29.000 --> 0:02:32.400 He spent six years focused on Series A and B investments, 0:02:32.440 --> 0:02:35.880 followed by seven years and county focused on growth stays, 0:02:35.919 --> 0:02:40.560 Series C, D and E opportunities. I asked Elliott about 0:02:40.560 --> 0:02:44.280 how cloud computing in the agent COVID might accelerate innovation 0:02:44.760 --> 0:02:49.359 in stubborn industries. So I oftentimes like to to weaverage 0:02:49.400 --> 0:02:51.880 or quote from one of my favorite videos. You know, 0:02:51.919 --> 0:02:54.840 before I joined best mers a partner and twelve Ventures 0:02:54.880 --> 0:02:58.800 which was Microsoft Global Venture Fun and in that role, 0:02:59.000 --> 0:03:01.360 I was lucky to spend time with Sasti Nudela, who 0:03:01.440 --> 0:03:04.200 is still the CEO of Microsoft. And it was probably 0:03:04.400 --> 0:03:07.320 maybe like three months ago after earnings caller. During an 0:03:07.320 --> 0:03:10.800 earnings caller, Satia said, you know, we've seen more digital 0:03:10.840 --> 0:03:15.359 transformation decisions and initiatives being taken by our client base 0:03:15.440 --> 0:03:18.680 and customers in the last two months than we have 0:03:18.760 --> 0:03:22.560 in the last two years. And what does that really mean. Um, 0:03:22.639 --> 0:03:26.280 that means there's been some kind of legacy industries that 0:03:26.320 --> 0:03:29.919 have bought software in a certain way for two plus decades, 0:03:30.080 --> 0:03:32.400 you know on prim software where people still have to 0:03:32.440 --> 0:03:36.040 come to your premise, sit there and like swap out 0:03:36.040 --> 0:03:39.600 the CDs or download things onto your system. Um. But 0:03:39.760 --> 0:03:43.040 now with with you know, the proliferation of about computing, 0:03:43.280 --> 0:03:46.160 you can do all of that remotely. You can continuously 0:03:46.640 --> 0:03:49.760 update and release new software. So when Satia says he's 0:03:49.760 --> 0:03:51.920 seen more digital transformation in the last two months in 0:03:51.920 --> 0:03:55.000 the last few years, what he's really saying, is you know, 0:03:55.120 --> 0:04:00.840 powered by things like AWS and Azure and GCP. Folks 0:04:00.840 --> 0:04:04.760 are just really pushing cloud software applications to the forefront, 0:04:05.080 --> 0:04:07.920 every every part of the stack of infrastructure to platform 0:04:08.240 --> 0:04:11.360 to kind of the software front inside. UM. So for me, 0:04:11.880 --> 0:04:14.520 you know, COVID has been an interesting thing because cloud 0:04:14.640 --> 0:04:18.240 was already moving quickly. But now everyone's working from home. 0:04:18.880 --> 0:04:21.359 You know, we're working from home now, at least on 0:04:21.400 --> 0:04:23.800 the tech company side, we might be working from home 0:04:24.120 --> 0:04:27.039 like indefinitely, or at least this remote first kind of 0:04:27.080 --> 0:04:31.560 work from home virtual world. So the areas that we're seeing, um, 0:04:31.600 --> 0:04:33.479 you know, a lot of movement is you know, we 0:04:33.560 --> 0:04:35.960 call it future of work, but what does that really mean. 0:04:36.400 --> 0:04:39.880 That means, you know, people that are building distributed teams, 0:04:40.040 --> 0:04:42.720 startup founders in the ecosystem today, there was this thing 0:04:42.760 --> 0:04:44.479 where you know, you might have to move to a 0:04:44.520 --> 0:04:47.240 really cool city like l A to find, you know, 0:04:47.360 --> 0:04:49.640 talent that you can hire and build your team. That's 0:04:49.680 --> 0:04:52.520 not necessarily the case right now or the future. It's 0:04:52.560 --> 0:04:54.240 kind of been like that the last few years. It's 0:04:54.240 --> 0:04:57.240 been companies that started that way. But now you can 0:04:57.279 --> 0:05:02.680 build a team be totally distributed just in the States, 0:05:02.680 --> 0:05:05.240 you could have you know, headquarters quote unquote in l 0:05:05.279 --> 0:05:08.720 a Iron, New York, Austin. You know, there's some great 0:05:08.720 --> 0:05:11.440 tech hubs like Detroit and Atlanta that are really bubbling up. 0:05:11.920 --> 0:05:14.479 So there's a bunch of software tools that most startups 0:05:14.480 --> 0:05:17.840 need to help manage that. How do you do remote learning, 0:05:18.160 --> 0:05:21.400 remote sharing? Of course, I think we're on Zoom today 0:05:21.440 --> 0:05:23.800 and you know, they just announced a bunch of new 0:05:23.960 --> 0:05:26.600 kind of integrations and tool sets to make you know, 0:05:26.640 --> 0:05:31.240 more of a remote office environment, UM even more effective. 0:05:31.320 --> 0:05:34.040 So we think about things like future of work with 0:05:34.400 --> 0:05:39.039 productivity tools, UM, knowledge sharing tools, even down to the 0:05:39.120 --> 0:05:41.839 back office. That's actually one area that I'm really excited about. 0:05:41.880 --> 0:05:45.440 So companies that are dealing with UM international payroll, which 0:05:45.480 --> 0:05:47.160 is a space that that we've been spending a lot 0:05:47.160 --> 0:05:52.360 of time, or distributed payroll, distributed hr UM, distributed you know, 0:05:52.440 --> 0:05:55.560 accounting software. All of these things are now going from 0:05:55.600 --> 0:05:58.760 in office to in the cloud, and the whole definition 0:05:58.760 --> 0:06:01.479 of what is an office, I think is changing. The 0:06:01.560 --> 0:06:04.440 last thing I'll say on this this topic, UM knowing 0:06:04.480 --> 0:06:07.040 a couple of folks from the AFRO Tech team. One 0:06:07.040 --> 0:06:09.520 of the coolest things about AFRO tech for me has 0:06:09.560 --> 0:06:12.080 just been as an outsider looking at the office culture. 0:06:12.520 --> 0:06:15.760 It looks like the most fun place to work at 0:06:15.760 --> 0:06:19.160 the African American venture capitalists. I can go weeks without 0:06:19.560 --> 0:06:22.080 you know, necessarily seeing someone else that looks like it 0:06:22.240 --> 0:06:24.600 was a remarkable place office I could work out of. 0:06:24.680 --> 0:06:28.080 It's probably Afro text office. But now they're remote. So 0:06:28.120 --> 0:06:31.680 how do you take such a unique culture? UM? I 0:06:31.720 --> 0:06:34.680 think it's called like wind down Wednesdays or Fridays or 0:06:34.680 --> 0:06:36.800 something something really cool like that. But how do you 0:06:36.839 --> 0:06:39.320 pull that into zoon? How do you pull that into 0:06:39.680 --> 0:06:42.400 you know, like a hopic and environment and make it cool, 0:06:42.560 --> 0:06:45.159 bring the music in, bring the culture in. Um. And 0:06:45.160 --> 0:06:47.280 I'm really excited about some of the opportunities that are 0:06:47.320 --> 0:06:52.160 coming there. It's in a respect um, how fast our 0:06:52.200 --> 0:06:55.640 companies growing today? You know, beat with the ability that 0:06:56.279 --> 0:07:00.520 the efficiencies that cloud computing provides, and how as COVID 0:07:00.600 --> 0:07:02.760 changed that. So if you look at two years ago, 0:07:02.839 --> 0:07:06.719 how fast companies? How does that scale? Exceptional question? And 0:07:06.760 --> 0:07:08.279 you said two things that I'm going to pick on. 0:07:08.680 --> 0:07:12.280 Not only are companies able to move faster? Uh and 0:07:12.360 --> 0:07:15.400 kind of a remote first environment if you're willing the hustle. 0:07:15.720 --> 0:07:17.680 You know, I actually think it's it's kind of a 0:07:17.760 --> 0:07:21.080 unique time. Um for underserved founders. I don't like the 0:07:21.080 --> 0:07:23.880 whole underrepresentative or minority. I think it's a it's a 0:07:23.920 --> 0:07:28.600 trash term. We're just underserved. Um, So for underserved pounders. Actually, 0:07:29.200 --> 0:07:30.760 you know, you can take two sides of the coin. 0:07:31.280 --> 0:07:34.000 From a funding perspective, it's always been tough for us, 0:07:34.120 --> 0:07:37.400 right um, and perhaps in a world where you can't 0:07:37.440 --> 0:07:39.880 necessarily spend time face to face gems to know people 0:07:39.920 --> 0:07:42.960 that will be tougher. But from an operational standpoint, you 0:07:42.960 --> 0:07:46.160 can actually take a lot more meetings now. Um. You know, 0:07:46.240 --> 0:07:48.160 if I think about companies here in the Bay Area, 0:07:48.160 --> 0:07:50.640 in in l A, for example, when I used to 0:07:50.680 --> 0:07:52.960 fly into l A, I can only take three to 0:07:53.040 --> 0:07:56.000 four meetings a day because traffic was crazy. I try 0:07:56.040 --> 0:07:59.320 to stay Dennis Panta Monica kind of a hub. But 0:07:59.400 --> 0:08:01.880 I love play is like Culver City. I still love 0:08:01.920 --> 0:08:04.800 West Hollywood, and it would take me forever to get around. 0:08:04.800 --> 0:08:07.720 Now with with Zoom and more of the remote work culture, 0:08:08.080 --> 0:08:10.720 you can bang out calls from seven am to seven 0:08:10.760 --> 0:08:13.880 pm any time zone. I'm on calls at eleven pm 0:08:13.920 --> 0:08:17.080 with my team in Europe and Tel Aviv. I started 0:08:17.120 --> 0:08:19.480 my day at six am with my partner in Tel Aviv. 0:08:19.560 --> 0:08:22.640 We've got you know, um folks in China. Now we've 0:08:22.640 --> 0:08:25.520 got two offices in New York. So the whole idea 0:08:25.560 --> 0:08:28.720 of what your schedule looked like has changed. So typically 0:08:28.720 --> 0:08:31.720 where you are time constrained in a physical, face to 0:08:31.840 --> 0:08:35.280 face environment, all those things have moved. So again, picking 0:08:35.320 --> 0:08:37.720 on your first word of growth, I think you can 0:08:37.840 --> 0:08:42.360 you can take more business development, more potential customer pipeline meetings, 0:08:42.600 --> 0:08:44.360 and a way you can before and then the second 0:08:44.360 --> 0:08:47.920 word that to use, I'm gonna pick on his efficiency. Um, 0:08:47.960 --> 0:08:51.080 So I think everyone's business from like just a fixed 0:08:51.080 --> 0:08:55.160 cost basis has changed, right, Like you know you you 0:08:55.240 --> 0:08:58.320 might not need that office space. While it might be 0:08:58.520 --> 0:09:01.319 advantageous for you to have face to face time with 0:09:01.360 --> 0:09:04.400 your employees and your employee base to build that culture, 0:09:04.760 --> 0:09:08.280 maybe doing it remote is easier. People certainly aren't flying 0:09:08.640 --> 0:09:10.680 nearly as much last year. I think I logged like 0:09:10.679 --> 0:09:14.679 a hundred twenty nights and hotels. I'm I'm at zero. Well, 0:09:14.720 --> 0:09:17.960 actually I'm technically at like a couple. Um, my wife, 0:09:18.080 --> 0:09:20.480 I took a little bit of a vacation just to 0:09:20.520 --> 0:09:23.160 get a change of scenery. But um, you know a 0:09:23.160 --> 0:09:26.319 lot of the fixed costs that are in an operation 0:09:26.360 --> 0:09:29.240 are now changed. It's not that they're gone, it just changed. 0:09:30.600 --> 0:09:33.120 So where founders may have raised a million dollars in 0:09:33.160 --> 0:09:36.520 their seed round or um maybe a super angel around 0:09:36.520 --> 0:09:39.160 a year ago, and you have these like fixed costs 0:09:39.160 --> 0:09:42.080 to build things out. Now with everything remote and your 0:09:42.080 --> 0:09:45.920 ability to hire and lower costs geos and cities where 0:09:45.920 --> 0:09:48.960 the talent pools are just as good or sometimes even better, 0:09:49.280 --> 0:09:51.440 you know, you can pull that money out and you 0:09:51.480 --> 0:09:54.560 know is under served founders. That's that's kind of like 0:09:54.640 --> 0:09:57.400 one of our skill sets we've always made more less. 0:09:57.480 --> 0:10:00.720 So I'm pretty excited about some of those respects as well. 0:10:01.080 --> 0:10:04.040 That's a great um t up to my next question 0:10:04.080 --> 0:10:06.760 because it would seem that because of the scale and 0:10:06.800 --> 0:10:11.040 relatively low cost of cloud computing, um in the efficiencies 0:10:11.040 --> 0:10:16.040 that it provides, it would that startups may need less 0:10:16.080 --> 0:10:20.560 to do more things. Right. Um, but is that capital 0:10:20.720 --> 0:10:24.880 just being redeployed elsewhere versus how it would have historically 0:10:24.960 --> 0:10:27.400 been deployed against those fixed costs and etcetera. You know, 0:10:27.440 --> 0:10:32.920 travel or those things. Because the prices aren't necessarily going down. Yeah, 0:10:32.960 --> 0:10:35.719 that's a good point. Um. The way I look at 0:10:35.760 --> 0:10:39.120 it is, Uh, if you're cutting let's just say your 0:10:39.160 --> 0:10:42.480 annual budget for your startup is let's just say that 0:10:42.640 --> 0:10:46.720 salaries for a couple of people. Um, maybe you've reduced 0:10:46.760 --> 0:10:49.640 your office space or gotten rid of it. And if 0:10:49.679 --> 0:10:52.840 you've freed up just even a hundred brands out of 0:10:52.840 --> 0:10:56.160 your budget year over year in COVID versus free COVID, 0:10:56.600 --> 0:11:00.000 there's a bunch of different things you can do with that. Um. 0:11:00.000 --> 0:11:02.760 You know what I've really liked is the whole gig 0:11:02.800 --> 0:11:05.080 economy has always been a thing, but I think in 0:11:05.200 --> 0:11:08.240 COVID it's even different. So you can try new things 0:11:08.240 --> 0:11:10.760 on the marketing side, on the biz DEEV side, on 0:11:10.800 --> 0:11:13.440 the pr side, that perhaps you couldn't have done before 0:11:13.440 --> 0:11:17.960 because either needed an in house or you know, the 0:11:18.040 --> 0:11:20.320 business has been working a certain way for a couple 0:11:20.320 --> 0:11:22.319 of years, So a smaller business couldn't have got the 0:11:22.360 --> 0:11:25.680 attention of a marketing or pr um kind of shop 0:11:25.720 --> 0:11:27.480 in the way that it can now where everything is 0:11:27.520 --> 0:11:30.920 discerned mediated. So I think it's it's down to the 0:11:30.960 --> 0:11:34.960 business to your comment of prices haven't come down that's 0:11:35.000 --> 0:11:37.640 certainly the case because everyone is trying to meet their 0:11:37.720 --> 0:11:41.120 their top line revenue goals. So while prices haven't changed, 0:11:41.120 --> 0:11:44.040 the one thing I can say is negotiating terms have changed. 0:11:44.559 --> 0:11:46.920 So in this world have been certainty. There's a lot 0:11:46.960 --> 0:11:49.800 of software and clouds, software tools that said, hey, this 0:11:49.840 --> 0:11:53.080 is a minimum one year commitment. A lot of things 0:11:53.080 --> 0:11:55.480 have changed in COVID where they said, okay, well, everyone's 0:11:55.520 --> 0:11:57.640 business is kind of up in the air. You know, 0:11:57.760 --> 0:12:00.720 why don't we give the first three months way free, 0:12:01.000 --> 0:12:02.720 or why don't you sign up for a year, but 0:12:02.800 --> 0:12:04.640 you don't have to pay us anything for the first 0:12:04.640 --> 0:12:07.559 six months. We just want to keep you locked in UM. 0:12:07.600 --> 0:12:10.640 If you're on kind of the accounting or controller side 0:12:10.640 --> 0:12:13.640 of a business, as as some of these software licenses 0:12:13.840 --> 0:12:16.440 come up to renew, I would certainly be thinking about, 0:12:16.600 --> 0:12:19.560 you know, renegotiating. I'm never gonna tell you to, you 0:12:19.600 --> 0:12:22.320 know hard renegotiate and think you're gonna get fifty percent off. 0:12:22.320 --> 0:12:25.360 But you know a lot of companies that weren't potentially 0:12:25.360 --> 0:12:28.800 working UM with customers a year ago, and in COVID 0:12:29.120 --> 0:12:31.800 there are a lot more open to negotiating. So not 0:12:31.880 --> 0:12:34.520 just the fixed costs that have come out during COVID 0:12:34.600 --> 0:12:37.400 of of being virtual. But even those those same kind 0:12:37.400 --> 0:12:40.000 of virtual class software tools I've talked about, you and 0:12:40.000 --> 0:12:42.440 I've been discussing, you can go back to the drawing 0:12:42.480 --> 0:12:45.560 board and say, hey, beyond just a ten or fiftcent 0:12:45.679 --> 0:12:49.120 haircut until things get back to normal, maybe we can 0:12:49.160 --> 0:12:51.240 change some of the payment terms. And that's another way 0:12:51.240 --> 0:12:53.840 to kind of extend your your catch lun way. So 0:12:54.000 --> 0:12:56.160 let's think about like prices coming down from a different 0:12:56.160 --> 0:12:59.000 perspective owned because I'm not a VC, but it would 0:12:59.080 --> 0:13:01.240 appear to me that you know, buy in to get 0:13:01.280 --> 0:13:04.000 in on these deals hasn't come down either with regards 0:13:04.000 --> 0:13:08.120 to you know that capital being more flexibly UM deployed. 0:13:08.200 --> 0:13:12.480 So how how can you how do you read that? Look, 0:13:12.679 --> 0:13:15.880 we're not doing as much you know in these fixed costs, 0:13:15.920 --> 0:13:20.200 these travel expenses, you know, UM, but the prices of 0:13:20.240 --> 0:13:24.600 getting in on deals hasn't reduced. Yeah, there's this weird 0:13:24.720 --> 0:13:27.360 macro thing that happened, and it's really a dual side 0:13:27.400 --> 0:13:31.880 of equation. So one UM, the last six to twelve months, 0:13:32.600 --> 0:13:35.719 more capital has been raised, are bigger funds have been 0:13:35.800 --> 0:13:38.960 raised than ever before UM And then the other thing 0:13:39.040 --> 0:13:41.200 that happened. On the other side of the equation is 0:13:41.760 --> 0:13:45.400 unfortunately in COVID, there's a lot of businesses that were impacted, 0:13:45.400 --> 0:13:48.400 but it's super volatible. So what I mean by that 0:13:48.559 --> 0:13:53.280 is um an aggregate businesses are just dealing with uncertainty. 0:13:53.440 --> 0:13:57.040 So that means there's less companies that are still either 0:13:57.160 --> 0:14:00.240 hitting plan or beating plan. So on one side, you've 0:14:00.280 --> 0:14:02.760 got more capital that needs to go into these companies 0:14:02.760 --> 0:14:05.480 than ever. On the other side, you might have it's 0:14:05.480 --> 0:14:07.560 not that like companies are familing, but you might have 0:14:07.559 --> 0:14:10.240 a smaller basket of companies that are really thriving in 0:14:10.240 --> 0:14:12.560 COVID who would be either figured it out, they might 0:14:12.600 --> 0:14:15.319 be in a market or industry vertical that's actually got 0:14:15.320 --> 0:14:19.400 a COVID tailwind versus a headlind. So there's more capital 0:14:19.440 --> 0:14:23.480 than other going after a smaller subset of opportunities. Therefore, 0:14:23.880 --> 0:14:26.280 you know, just to find demand. The prices have come 0:14:26.360 --> 0:14:29.600 up um, but look at the end of the day, 0:14:29.640 --> 0:14:34.720 like valuations, UM, they're certainly meaningful in every company's li 0:14:34.920 --> 0:14:38.440 every entrepreneurs, like every term early team's life, because it 0:14:38.680 --> 0:14:41.120 has to do with delution in your own equity and 0:14:41.160 --> 0:14:45.160 what you own. What I would really be advising founders 0:14:45.200 --> 0:14:49.160 on is and this doesn't necessarily change in COVID. But 0:14:49.480 --> 0:14:51.560 if some of the funds that one's been time with 0:14:51.760 --> 0:14:54.200 you pre COVID, now all of a sudden one has 0:14:54.240 --> 0:14:56.600 been time with you, like you need to ask yourself 0:14:56.640 --> 0:14:58.800 why that is. And that could be on both sides. 0:14:58.840 --> 0:15:01.600 That could be they think, thank your um, you know, 0:15:01.640 --> 0:15:03.920 you're seeing some COVID headwinds and now it's like a 0:15:03.920 --> 0:15:06.560 good opportunity to get in cheap or cheaper than they 0:15:06.560 --> 0:15:08.760 think it would be. Or you're really seeing some tail 0:15:08.800 --> 0:15:11.040 winds and now they're all over you. I'm just like 0:15:11.080 --> 0:15:14.360 a very values based person. So the question is if 0:15:14.360 --> 0:15:17.000 they weren't spending time with you when things were good, 0:15:17.200 --> 0:15:20.560 like you know, perhaps that's not the right fit for 0:15:20.600 --> 0:15:23.480 you and your company and your your core founding team 0:15:23.560 --> 0:15:26.440 for the next two or three years. Just really try 0:15:26.520 --> 0:15:29.840 to think about that fit. And we're also the last 0:15:29.880 --> 0:15:32.040 comment on make on this is we're going into a 0:15:32.200 --> 0:15:35.240 really unique time in this country. Twenty has been the 0:15:35.240 --> 0:15:37.640 craziest year I think all of the experience, certainly in 0:15:37.680 --> 0:15:41.320 my adult life, and all that means is uncertainty and 0:15:41.400 --> 0:15:44.240 every kind of CEO and sea level are co founding 0:15:44.280 --> 0:15:46.760 team is thinking about, you know, what does the next 0:15:46.760 --> 0:15:49.520 six months look like for us? And that that impacts 0:15:49.560 --> 0:15:52.680 everyone's business. So I think, you know a lot of 0:15:52.680 --> 0:15:55.800 founders are just you know, trying to stay conservatives, stay 0:15:55.840 --> 0:15:58.960 the course, but also be flexible as the next three 0:15:58.960 --> 0:16:01.440 to four months are gonna be really um followl when 0:16:01.440 --> 0:16:04.480 it comes to change. Is it possible startups maybe taken 0:16:04.520 --> 0:16:09.400 more capital? Do they need? Oh? For sure? Right? Well, actually, 0:16:09.440 --> 0:16:11.800 let me I hate that I answered that so strongly. 0:16:11.840 --> 0:16:14.640 I'm not sure if it's a foreshore, but it's certainly proving. 0:16:15.240 --> 0:16:17.120 Um you know, I think I had written a tweet 0:16:17.160 --> 0:16:19.720 a week or two ago all caps are saying why 0:16:19.840 --> 0:16:23.200 is every company in America raising right now? And it 0:16:23.320 --> 0:16:26.320 actually is my last comment, which is why we're about 0:16:26.360 --> 0:16:29.680 to enter a period of uncertainty that we've never seen. 0:16:30.320 --> 0:16:34.680 Um So, if you're a company that's performing relatively well 0:16:34.840 --> 0:16:37.400 to plan or or even beating it, why not do 0:16:37.440 --> 0:16:40.320 it now before we enter into this kind of desert 0:16:40.400 --> 0:16:44.160 of uncertainty. Um So, I certainly understand that, but I 0:16:44.600 --> 0:16:46.920 will make sure I address your question, which is, do 0:16:47.000 --> 0:16:49.720 I think companies are raising too much money? I think 0:16:49.760 --> 0:16:56.880 some companies certainly are. Um. There's this mentality um and 0:16:56.880 --> 0:16:59.760 and just kind of a behavioral norm that happens when 0:16:59.800 --> 0:17:03.680 you raise enough capital to have twelve to maybe eighteen 0:17:03.760 --> 0:17:06.680 months of cushion and you can just crank that business out. 0:17:06.720 --> 0:17:09.560 You're thinking about efficiencies. You're always thinking about your balance 0:17:09.600 --> 0:17:12.400 sheet in your bottom line, where sometimes if you raise 0:17:12.480 --> 0:17:15.720 so much capital ahead of plan, you know, not only 0:17:15.720 --> 0:17:17.440 are you sitting there thinking that what am I gonna 0:17:17.440 --> 0:17:19.520 do with all this extra money I raised, but your 0:17:19.560 --> 0:17:23.159 investors are also thinking, well, look the I R our 0:17:23.240 --> 0:17:25.840 clock is still ticking on my money that I gave you. 0:17:25.920 --> 0:17:29.000 I need to generate a return faster. So now we 0:17:29.000 --> 0:17:32.399 we start adding on to fits and variable costs at 0:17:32.440 --> 0:17:35.760 a rate that wasn't necessarily the original plan. Right. And 0:17:35.800 --> 0:17:38.520 then you know the term that I always uses. I 0:17:38.600 --> 0:17:41.080 never want to put a founder or an executive team 0:17:41.080 --> 0:17:44.800 in a position of doing unnatural things. Um. You know, 0:17:45.200 --> 0:17:48.399 an expel plan is just numbers and the excel. But 0:17:48.480 --> 0:17:51.159 if your balance sheet is now boosted to a point 0:17:51.560 --> 0:17:53.960 where you know it doesn't reflect the plan, now now 0:17:54.000 --> 0:17:57.160 everyone feels it's pressured to change, and that's not good 0:17:57.200 --> 0:18:11.640 for either side. Season two of The Black Tech, Green 0:18:11.680 --> 0:18:14.560 Money Podcast is brought to you by Lexus, known for 0:18:14.640 --> 0:18:18.080 celebrating driveway moments for over thirty years. Lexus invites you 0:18:18.119 --> 0:18:20.800 to create more with exclusive offers on the most popular 0:18:20.880 --> 0:18:24.679 Lexus models at the December to Remember Sales event. Experience 0:18:24.720 --> 0:18:29.320 amazing at your Lexus dealer, being black me and seeing 0:18:29.320 --> 0:18:32.719 people of other ethnicities and backgrounds realize the value of 0:18:32.760 --> 0:18:37.600 our sauce. They capitalize what we create, They monetize the 0:18:37.640 --> 0:18:41.560 culture we move As a creator, I'm interested in the 0:18:41.560 --> 0:18:44.120 take of a VC like Elliott on how we as 0:18:44.119 --> 0:18:47.639 the global leaders and was hidden music, fashion, food, sports 0:18:47.720 --> 0:18:51.040 and more might finally be able to realize the reward 0:18:51.080 --> 0:18:54.159 in the marketplace for the ideas that we bring to 0:18:54.240 --> 0:18:58.000 the table. Elliot Robinson speaks on it. So I'm gonna 0:18:58.000 --> 0:19:00.720 take a thirty and then probably go down to like 0:19:00.760 --> 0:19:04.840 ten thousand community and on the street level, UM, I 0:19:04.920 --> 0:19:10.080 think thirty thousand feet view. UM. What I'm really excited 0:19:10.119 --> 0:19:14.200 by is the growing number of enterprise software and cloud 0:19:14.240 --> 0:19:17.800 software opportunities that I'm seeing founded by UM not just 0:19:17.920 --> 0:19:22.960 black founders, but UM Latin X founders and women founders. Traditionally, 0:19:23.080 --> 0:19:27.119 for whatever reason, it actually makes a lot of sense um. 0:19:27.160 --> 0:19:29.280 At least the last five to ten years, a lot 0:19:29.320 --> 0:19:32.440 of the start up opportunities have been focused at consumer 0:19:32.520 --> 0:19:36.239 opportunities because while founders that look like me and you 0:19:36.240 --> 0:19:39.919 are underserved, you know, consumers are underserved. Right. There's this 0:19:40.200 --> 0:19:43.320 its age, old adage. You know. I started my career 0:19:43.359 --> 0:19:47.400 to all black mentuer firm in DC called Singcom Venture Partners, 0:19:47.840 --> 0:19:52.320 and we were the first investors in bt SO, first 0:19:52.320 --> 0:19:56.360 investor in bt UM. You know, Bob Johnson says all 0:19:56.359 --> 0:19:59.440 the time at Singcom and herb Wilkinson exists bt when 0:19:59.440 --> 0:20:02.040 it is. We're the only investor who served the board 0:20:02.080 --> 0:20:06.360 from first investment until it was sold to Viacom. And 0:20:06.440 --> 0:20:08.880 then you know, in the middle of that, we invested 0:20:08.920 --> 0:20:11.920 in Kathy Hughes who started Radio one in TV one. 0:20:12.359 --> 0:20:14.520 All right. You know a lot of people said to us, well, 0:20:14.640 --> 0:20:17.919 there's already b t like, why on earth would you 0:20:18.000 --> 0:20:20.600 invest in radio one TV one? And we said, dude, 0:20:20.600 --> 0:20:24.040 I mean, you know, we're talking about fifteen million people 0:20:24.200 --> 0:20:26.680 and you give them one channel and then we got 0:20:26.680 --> 0:20:29.399 three hundred channels serving the rest of the communities. Doesn't 0:20:29.440 --> 0:20:34.000 make any sense, um. So you know, I think historically 0:20:35.119 --> 0:20:38.640 because our consumer base is seen as one very homogeneous, 0:20:38.640 --> 0:20:41.720 which it's not. There's all different types of lanes and 0:20:41.840 --> 0:20:46.560 tide to the black consumer opportunity. But because we're underserved, 0:20:46.720 --> 0:20:52.040 there's just so much like clear obvious opportunity to go 0:20:52.119 --> 0:20:55.639 after the consumer market. But I think in the enterprise space, 0:20:57.000 --> 0:20:59.440 you know, it's it's like it would take a whole 0:20:59.440 --> 0:21:03.560 another zoom to really break down my views on on UM. 0:21:03.640 --> 0:21:06.720 Why we're just naming these opportunities and these ong noors now. 0:21:06.800 --> 0:21:11.680 But I'm really excited by the diversity UM that's influencing 0:21:11.760 --> 0:21:14.639 kind of cloud and enterprise software. And that's where I 0:21:15.800 --> 0:21:18.880 as a cloud investor UM and spending my time. Now 0:21:18.880 --> 0:21:21.120 I'm on the later stage investor. We can talk about 0:21:21.119 --> 0:21:23.800 that a little bit, but you know, I I spend 0:21:23.800 --> 0:21:26.200 a lot of time with the early side, even down 0:21:26.240 --> 0:21:29.440 to the seed team of going through all the lists 0:21:29.680 --> 0:21:33.000 of UM kind of black and brown founders going after 0:21:33.119 --> 0:21:36.520 enterprise and making sure that that vessel's meeting with UM 0:21:36.560 --> 0:21:39.000 and making sure that we're we're funding. We just funded 0:21:39.000 --> 0:21:41.280 one that we haven't announced yet, which I'm really excited 0:21:41.560 --> 0:21:45.600 about coming around, but one is certainly not enough UM. 0:21:45.640 --> 0:21:48.280 You know, we don't have a set number, but in 0:21:48.320 --> 0:21:50.600 my own mind, I've got a number of where I'd 0:21:50.640 --> 0:21:52.840 like to see the portfolio go, and I'm really excited 0:21:52.840 --> 0:21:57.639 about that. On the street level, UM, you know, I 0:21:57.760 --> 0:22:03.160 just I think that we and then this is gonna 0:22:03.200 --> 0:22:05.760 I want to make this very nuanced. I think that 0:22:06.640 --> 0:22:08.520 one thing that has to change on the street level 0:22:08.560 --> 0:22:13.840 is like we as a UM underserved entrepreneur base and 0:22:13.960 --> 0:22:20.119 underrepresented investor base, we just gotta think bigger UM. And 0:22:20.119 --> 0:22:23.080 And that's like a really nuanced thing, because sometimes people 0:22:23.119 --> 0:22:25.160