Recapping the Black Founders Forum
In honor of Black Heritage Month, StartEngine partnered with the Black employee resource groups at Amazon (BEN), LinkedIn (BIG), and MERG-E (the Michigan Employee Resource Group for Equity) to host a panel discussion showcasing the inspiring journeys of six Black founders from companies raising capital (or who previously raised) on the StartEngine platform. You can watch the highlights or read the recap below.
The forum addressed the topic of equity as it relates to access to capital for Black founders, as well as the challenges related to building wealth within the Black community.
J. Ofori Agboka, the Vice President of People-eXperience-Technology (PXT), Global Customer Fulfillmentat Amazon, served as the moderator of the forum and live Q&A.
Ofori kicked off the forum by speaking to each founder one-on-one to get to know their business and the stage of fundraising they are currently at.
Dawn Dickson, PopCom
Dawn Dickson’s startup, PopCom, builds software and hardware for automated retail. Dawn started the business in 2017 to solve a problem that she experienced when she was a retailer: she wanted to sell her product in vending machines and collect the same level of data that she was able to collect in an e-commerce environment. “At the time it just did not exist, so we built the software to make vending machines smarter and allow any product to be sold in machines, including alcohol, cannabis, and pharmaceuticals with our technology,” Dawn explained.
“We do for vending machines what Apple did for the cellphone,” Dawn told Ofori. He in turn pointed out, “You were one of the first Black women to raise over $1 million dollars [via Regulation Crowdfunding] in 2019.”
PopCom was also able to raise over $3 million in equity crowdfunding, over three rounds: two previous Regulation Crowdfunding campaigns, and one Reg A+, which is currently open on StartEngine.
Solutions Vending International, Inc. (d/b/a PopCom) is conducting a Reg A+ offering made available here through StartEngine Primary, LLC.
This investment is speculative, illiquid, and involves a high degree of risk, including the possible loss of your entire investment.
Isaac Hayes, III, Fanbase
Fanbase is a social media platform that allows content creators to monetize their platform through subscription and virtual currency. “Most content creators — and I consider all of us content creators — we create this enormous amount of content and we don’t get paid for it,” Isaac said.
Isaac knew that there were platforms out there that allowed individuals to monetize their content, “but once you look at that content, there’s nothing else for you to do,” he said, “there are no communities, right? And social networks are built off of communities.” He decided to start Fanbase in 2018 to provide a combination of fair compensation for creators and a sense of community for users.
Fanbase has raised $1.07 million dollars on the StartEngine platform.
Dr. Ahmad Glover, WiGL
Wireless-electric Grid Local Air Networks, or WiGL, is a smart, touchless, wireless power company. “WiGL is all about getting you power the same way you get WiFi,” founder Dr. Ahmad Glover explained.
Dr. Ahmad previously worked in the Air Force, where he worked as an Acquisitions Officer. “Every single time we’d do a demo, batteries would die on some kind of device,” he shared. After he retired, Dr. Ahmad decided he wanted to create a solution to this problem where people could access power wirelessly.
“Wireless power is the future of everything,” Dr. Ahmad said, pointing out that power is the one thing holding our ever-evolving devices back. “Folks are fighting feverishly to get into this space.”
Chloë Cheyenne, CommunityX
Founder Chloë explained that CommunityX is a social network for social good, which allows like-minded changemakers to be able to connect with one another around common causes, build communities, and mobilize around calls to action.
Chloë shared that she really grew up face-to-face with issues of police brutality, as her father experienced an extreme case of police discrimination that left him permanently handicapped. After Michael Brown was killed by police officers in Ferguson, “the question that I really asked myself was, how do I connect with other people who care about these issues like I do? And what’s the central platform that we can all go to to unite and mobilize for change?”
Chloë said she found that such a thing didn’t exist, and so she resigned from her position at Google to create CommunityX.
Tamar Blue, MentalHappy
MentalHappy is a network that matches individuals with people who are in a positive peer support group. “Individuals are able to find a niche of other peers who are experiencing a similar life event that they’re going through,” explained founder Tamar Blue.
There are also health professionals within the various MentalHappy support communities that offer mental wellness practices, as well as moderators who keep the group safe.
At the start of the pandemic, Tamar said they had just started pitching their idea to investors, who were not interested despite MentalHappy’s growing waitlist of over 5,000 people. So Tamar turned to StartEngine, where they were accepted to begin crowdfunding on the platform.
“It’s been tremendous,” said Tamar.
Ray Phillips, SoapSox
Founder Ray Phillips came up with SoapSox as a way to make bath time more fun for kids and easier for parents. A SoapSox washcloth is uniquely designed to look like a plush toy in the shape of a cute character, and hold soap within a cavity in the center of the cloth.
Ray previously worked as a program director at a group home for kids, where a child refused to take a bath because he couldn’t take his favorite stuffed animal into the bath. “I did what most parents do, you think outside the box to get through it, and SoapSox was born,” Ray said.
After going on Shark Tank and eventually being offered a buyout for $1 million, SoapSox decided to decline so that they could “play the long game,” as Ray put it. As Ofori pointed out, SoapSox was able to raise over $1 million themselves through crowdfunding on the StartEngine platform.
Raising Money During A Pandemic
When Ofori opened the forum up to a broader discussion, he first wanted to hear from the founders on what it was like to start raising money during the COVID-19 pandemic.
Dawn launched PopCom’s second Reg CF campaign at the outset of the pandemic. “It was a very uncertain time,” Dawn shared. But she found that investors were really understanding about delays and setbacks caused by COVID-19 as long as PopCom was being communicative about them. “The StartEngine investors are really our biggest advocates.”
Chloë also pointed out the effect that the pandemic had on jobs and the economy. “For us, we were in the middle of a roadshow asking for a $10k minimum investment in our round, but the fact that we were able to pivot and build a campaign on StartEngine for a $150 [minimum] had a really big impact.”
Challenges to Accessing Capital for Black and Brown Communities
Ofori also wanted to know what the biggest challenges might be for Black and Brown communities when it comes to accessing capital. Dr. Ahmad explained that he experienced discrimination when he was invited to speak to wealthy investors about raising money for WiGL. “I’m talking about driving in the middle of a pandemic, driving a few hundred miles to go sit on someone’s back patio, for them to go through everything from my mother’s middle name to why I wear my hair this long, to get a soft ‘no.’’
Dr. Ahmad explained that StartEngine was “a godsend for me, a retired Air Force guy, a disabled veteran. I can tell you it is amazingly difficult to access capital from people who promise capital to you.”
Isaac also pointed out that the previous accredited Investor standard also used to cause problems for Black and Brown people trying to invest capital. “To invest in seed stage companies and private companies, you had to be an accredited investor up until 2012, and that means you had to have a net worth in excess of $1 million minus your primary residence or make over $200,000 a year,” Isaac said. “So you have to think about the amount of opportunity missed by poor people, people of color, Black people, women throughout this country.”
Isaac noted that the JOBS Act of 2012 allowed those same people to begin to invest in the seed stage regardless of net worth. Tamar added that equity crowdfunding allowed her to see through the misconception that people of color don’t have much disposable income. She initially strategically targeted MentalHappy’s crowdfunding campaign to people of color in the Bay Area, and she found that many were ready and happy to invest in her campaign.
Economic Advancement for Black and Brown Communities
Ofori asked the founders what they thought was crucial for economic advancement in Black and Brown communities. “The key for Black America is assets,” said Dr. Ahmad, “we have to collectively as a people have more assets that we can hand off to someone in death, graduation, whatever that is. StartEngine gives us that opportunity. I’m a founder and I’m on StartEngine with WiGL, but I’m also an investor on StartEngine.”
Ray said he thinks “the long game is invaluable,” adding that “our responsibility as founders is to help the next generation of founders that are coming down the pipeline.”
Help for Black Founders
Tamar pointed out that “the whole Black Excellence thing came about because we literally cannot pass as a mediocre white guy. We have to have that A+ to be seen, and to be accepted, and to go forward.” Tamar said she encourages Black founders who feel pressure to have all their ducks in a row before a capital raise to push through the fear and move forward.
The founders also reiterated that not having access to information is a huge barrier to raising capital for Black founders, and that getting set up with a Regulation Crowdfunding campaign takes research and hard work, even with StartEngine’s help. Dr. Ahmad said he thought StartEngine was “wonderful in holding my hand” and walking him through raising money through WiGL’s Reg CF campaign, and provided resources like information and attorneys that help founders through the process of scaling their startups.
Black and Brown Women Leaders
During the live Q&A, a viewer brought up potential competition among Black and Brown women entrepreneurs and asked how they might uplift each other. “I don’t think we fight,” Tamar said. She mentioned that she’s in a group called Visible Figures, which Dawn is also part of, where Black female founders share leads, like investor spreadsheets, and help each other network.
Dawn agreed, saying “We have to all win, because keep in mind, there’s a thing called pattern matching. So I need every Black founder to win.”
During the forum, the founders continually stressed the importance of knowing their companies inside out before each raise, playing the long game both as founders and as investors, and sharing information and uplifting other Black founders. As they shared their inspiring stories and the role StartEngine played in helping them get their startups off the ground, they highlighted the evolving nature of startup and investor landscapes. As Ofori said in closing, “These founders are making history right now — you are witnessing greatness.”