|Sam’s back tomorrow, so let’s get over this hump together!
For today’s Big One, we’re bringing in Ebony Pope, Senior Manager, US Ventures at Village Capital, to discuss how inclusive entrepreneurship can lead to institutional funding for DC founders.
Ebony, take it away!
The Big One
A breakdown on the day’s biggest Inno story.
Ebony: As an investor, I am frequently asked for money, which of course comes with the territory.
However, it always breaks my heart to meet driven, ambitious founders who have built businesses with the assumption that they will take on VC funding, only to find that the company they have been building for the past few months (or even years) has no way of supporting this type of funding to generate the expected returns.
There is an acute need to focus on connecting entrepreneurs, even earlier in the pipeline, with capital within their city, before preparing for national scale. Earlier this year, our team at Village Capital has completed an ecosystem analysis with the Rockefeller Foundation to find out what problems DC entrepreneurs are facing, and how we can help them. Here’s what we found.
First, entrepreneurs from low-wealth communities in Washington, DC have particularly limited access to resources. Income equality is worse in Washington, DC than any other state in the nation: the top 10% of earners make at least 6 times more than the bottom 10%.
Yet DC ranks as #1 for best tech city for women for the third consecutive year, with females making up 41 percent of DC’s tech workers — well above the national average of about 26 percent and higher than all other cities in the personal finance website’s top fifteen. DC also has more women in computer- and math-related positions than most other U.S. cities.
Of the $56.8B poured into 4,520 VC deals across the US in 2016, DC represents 4.6% of this total dollar amount, up 26% from last year. The jump in dollars came in 176 deals, 10 fewer than the year before, distorted by a $1.6B Q4 investment in OneWeb.
So why is it that we aren’t seeing more companies from DC raising institutional funding to scale their innovations?
In order to invest in more high-growth and inclusive solutions, DC needs to focus on new tools and support resources to allow the market to more effectively support overlooked and undervalued companies. These companies are not developing effectively, due to a lack of access to early-stage capital and the resources to promote growth and scale.
In a given ecosystem, angel investors are generally willing to take risks on very early businesses and founders. A number of angel investors source companies through their respective angel groups, online searches, and warm leads. Village Capital Pathways, piloting in DC and expanding to Philadelphia, Chicago and Atlanta this winter, will expose local investors to overlooked companies right in their backyard and empower entrepreneur support organizations in these cities to equip these companies with the tools needed to excel.
If you are a startup founder in the DMV area beginning to strategize how to raise VC funding, below are two resources to get you on the right pathway.
1. Know what you are raising money for and how to communicate that to investors – VIRAL is a framework Village Capital has created for companies to articulate to investors that they are ready for investment. Use this tool to evaluate what milestones you have currently reached in each category, what outstanding items you need to achieve to reach the next level and determine the amount of capital you need from investors to level up.
2. Know where to find the resources in the DMV to help you at each level of the fundraising journey – There are tons of great resources in the area including pitch events, accelerators, venture capital firms and everything inbetween. We brainstormed a DMV VIRAL Heat Map with local leaders during one of our mentoring sessions. Feel free to use, share and comment if you think we’ve missed anything.
In The Know
The Inno stories you need to read today.
Inside the people, companies and organizations making moves today.
Today, Vienna, Virginia-based Urgent.ly, a leading digital roadside assistance platform, raised a $10M Series B funding from American Tire Distributors, which is the largest tire distributor in the U.S., and Verizon Ventures and Forte Ventures.
Every month, Urgenty.ly says that it manages tens of thousands of roadside assistance events through its platform, eliminating approximately 250,000+ calls that would’ve flooded call centers. [More Here]
In The Community
The events and happenings to know about tonight and this week.
Couple big events to get on your calendar…
Tonight: Bitcoin – Introduction & New Developments…
- Location: HacDC, 1525 Newton St NW, Washington, DC
- Date/Time: Wednesday, Oct. 4, 7 PM-10 PM
- Event Type: networking, meetup, skill development
- Price: Free
“Richard Weston will come give us an introduction to cryptocurrencies, specifically Bitcoin, and answer questions about recent developments. We’ll go over the basics of what Bitcoin (for example) is and address basic questions like “Can’t you copy & paste digital currency?” and “is Bitcoin anonymous?” for newcomers and get into more advanced (controversial?) questions like.”
Tomorrow: Startup Grind + Techweek Startup Panel: From Cradle to IPO
- Location: Alley – Washington DC, 2055 L St NW, Washington, D.C.
- Date/Time: Thursday, Oct. 5, 3 PM-5 PM
- Event Type: meetup, networking, speaker event
- Price: Free
“Panel discussion will be centered around what metrics to track as the company grows in the different stages from seed, angel, VC, Mezzanine, and IPO/acquisition. How does a startup approach growth in terms of customer acquisition, recruiting, and financing. We will have 3 startups from the Fishbowl Labs, a VC and a corporate M&A guru speak about their insights on what entrepreneurs should look for when growing their startups.”
What’s on the mind
For the past 7 years, I lived in Chicago – and prior to that I was in Boston for 3+ years – so, yes, it is certainly fair to wonder if my presence and Juju alone is responsible for the Cubs and Red Sox breaking their respective curses. Will me being a part of the DC Beat this week bring good fortune to the Nats? Yes. The answer is yes.
Well, that’s all she wrote! Sam’s back tomorrow so today is my (Will with American Inno) last day anchoring the newsletter. Thanks for having me everybody and talk soon!
Best of luck to the Nats!