Shontavia Johnson (00:00):

What’s up, y’all. Welcome to The Shontavia Show, where my goal is to help you start a business based on your life’s vision. This ain’t gonna be your daddy’s business advice. I’m laser focused on entrepreneurship in the 21st century, vision and breaking the traditional mold. If you can get with that, you can get with me, be sure to visit shontavia.com for more episodes, blog posts, and other content. Thank you for listening. The show starts now.

New Speaker (00:28):

What’s up y’all? I’m Shontavia Johnson and this is another episode of the Shontavia Show, where I want to help working professionals like you quickly start your dream business, make more money, and ensure that people know who you are. I hope everyone is safe, healthy, and staying at home during this coronavirus pandemic. This has been a wild time. I feel like we’re on a roller coaster of terrible lows with a few highs sprinkled in there every now and again of course for people who’ve contracted the coronavirus, their families, and the medical professionals doing their best to provide care, my heart really goes out to those folks. I have prayed for people who have succumb to this illness and the family they’ve left behind. I certainly have tried to support organizations who are contributing to supporting these families and medical professionals.

New Speaker (01:27):

It feels helpless sometimes to be honest, especially for those of us who really want to help, but we’re nowhere close to the medical field and just giving money sometimes feels like a drop in the bucket. But where I feel like I can really make a positive impact right now is with people who want to start businesses. Even during this time and maybe especially during this time, so many people have been furloughed, and let go, and are unsure about their job security. I really want to help support those folks and figure out ways that I can support their dreams and their vision of starting these businesses.

Shontavia Johnson (02:08):

And that’s hard because this has really been a roller coaster of a time for entrepreneurs too. It’s kind of like the worst of times and maybe the best of times, because small businesses are definitely hurting right now, right? Customers and clients are spending less money. They’re losing money, losing their jobs and staying at home. And so if you have a small business, you might think someone is crazy to try to start a business right now when consumers are not spending as much money, staying at home, and losing money. But, there’s a lot of opportunity for folks who can adapt to the changing times that we are living through right now to solve problems for people who need help.

Shontavia Johnson (02:51):

And another person who’s been masterful, I mean truly masterful, at adapting during these times and supporting entrepreneurs and founders who need help, is the subject and interviewee of this podcast episode and that’s Arlan Hamilton.

Shontavia Johnson (03:08):

I introduce her more fully later on in the show, but in addition to what I say later on in the show, I want to share a few more things about Arlan for folks who may be newer to her work. I learned about Arlan in 2015 through a Medium article she wrote that went viral. The title of that article was “Dear White Venture Capitalists: if you’re reading this, it’s almost too late.” In the article. Arlan calls out VCs for failing to invest in companies founded by people of color, women, and members of the LGBT community. She also tells them what they need to be doing to remedy this failing on their part, and how they can go about doing it. And then finally, the last thing she does in the article is invite them to get at her so that she can help them figure out how to support these businesses founded by people of color, women and members of the LGBT community.

Shontavia Johnson (04:10):

And not because it’s charity or because it’s some kind of philanthropic endeavor, but because it’s a good business move. It’s a good business opportunity. Everybody can thrive and make money when they diversify the way in which they’re investing their VC funds.

Shontavia Johnson (04:29):

Now, why would Arlan writes such an article? Why is VC funding important at all? VC funding…so the term VC means “venture capital.” And venture capital is an important tool for supporting innovation and entrepreneurship for people who have amazing world changing ideas, but not enough money on their own to test and prove those ideas. Some of the things we use every day that have literally changed the world started out as VC-backed startup companies–companies like Facebook, Google, Twitter, Dropbox, they were all VC-backed startups at one point, and today a lot of prominent companies are still VC-backed. One example is Instacart, and right now during the coronavirus pandemic, so many people are learning about Instacart if they didn’t know about them before.

Shontavia Johnson (05:26):

Instacart is basically a same day delivery service for groceries and it has become essential to busy people and families across the U.S. and Canada. And not just busy people, but now, many of us who are following the guidelines of health professionals to stay at home. So VC funding can take a good idea and turn it into a game changing multinational company that becomes interwoven into the fabric of our day to day lives. And Instacart is an example of that. It’s a company that was important before for sure, but now it’s become a critical resource for those of us who want to stay at home to protect not only our own lives and families, but also the lives and families and well-being of others. So VC funding is important. And one of the issues with VC funding, and this is why Arlan wrote her article, is that venture capital funding does not go to underestimated founders.

Shontavia Johnson (06:34):

Those are people who are women, people of color, members of the LGBT community, the numbers, the most recent data is abysmal. So I’m going to read off just a couple of the statistics and prepare to be appalled by these numbers.

New Speaker (06:52):

When it comes to women, for example, out of $85 billion of VC funding in 2018 only 2.2% went to female founders. And every year women of color get less than 1% of total funding. Out of all the VC funding over the past decade, Latinx women led startups have raised only 0.32% and black women have only raised 0.0006%. I don’t even think that registers on the scale, really. We’re talking about really, really small amounts of money going to founders who are equally as smart and innovative as everybody else. And then when it comes to people of color and VC funding, the numbers are not that much better.

Shontavia Johnson (07:45):

They’re a little better but not that much better. So most recently, the most recent data I’ve seen suggests that 2.4% of VC backed founders are Middle Eastern, a little less than 2% are Latin American, and just 1% identified as black. And these numbers have been in the years since Arlan’s 2015 Medium article was written.

Shontavia Johnson (08:14):

And since she wrote that article, Arlan has really upended Silicon Valley and taken it by storm. Today, she’s the founder and managing partner of a venture capital fund that has invested millions of dollars in hundreds of companies founded by women, people of color and people who are LGBT. And, Arlan has a new book coming out tomorrow, May 5th, 2020. The name of the book is, It’s About Damn Time: How to Turn Being Underestimated into Your Greatest Advantage.” Stacey Abrams had just has described this book as “a hero’s tale of what’s possible when we unlock our potential, continue the search for knowledge and draw on our lived experiences to guide us through the darkest moments.”

Shontavia Johnson (09:04):

I’ll drop a link in the show notes to the book for anyone who’s interested in buying it. Arlan and I talk about the book in this episode, and I have to say I had an opportunity to read an advanced copy of the book and I found it incredibly engaging, and insightful, and relatable. Like some of the stories she tells – these are the stories of people, of color, of women, of people in the LGBT community that we live every day.

Shontavia Johnson (09:35):

And so of course when you’re writing a book of this magnitude from a person who really has become legendary in Silicon Valley, a person who’s able to get advanced copies of her book to people like Stacey Abrams for comment, you typically go on a nonstop book tour with very, very high level, in-person engagements. You’re on all the national news shows and news stories and under the circumstances, a lot of those things aren’t possible right now because of the coronavirus pandemic.

Shontavia Johnson (10:11):

So Arlan has adapted in this particular instance with her book tour and she’s done a whirlwind of interviews digitally and I was honored to be one of the shows that was given the opportunity to speak with Arlan about her book, It’s About Damn Time, which again comes out tomorrow, May 5th, 2020, her work, and what she thinks the future is for underestimated founders. Y’all, I am so pleased to share this conversation with you here. Check it out.

Shontavia Johnson (10:43):

So excited to be here with Arlan Hamilton. Arlan has built a venture capital fund from the ground up. And it started in 2015 when Arlan was homeless with no network, no money, but a huge vision and a huge focus on investing in underrepresented, underestimated founders by becoming a venture capitalist. She’s founded and serves as the managing partner of Backstage Capital, which is a venture capital fund dedicated to minimizing funding disparities in tech.

Shontavia Johnson (11:15):

And they invest in high potential founders who just happen to be people of color, women and LGBT. And today they’ve raised millions of dollars and invested in more than 130 startup companies. Some of my favorite companies, Bandwagon Fanclub, just so, too many to name. I’m going to get in trouble probably if I start naming them, but so excited to be here with you, Arlan.

Arlan Hamilton (11:40):

Thank you so much. I’m very happy to be here.

Shontavia Johnson (11:43):

Yeah. So you are about to come out with a new book. You are actively raising money, you’re doing so many things. Could you talk a little bit about your story, about your background and how we got here?

Arlan Hamilton (11:57):

Sure. I was raised in Dallas and moved out to Southern California in my early twenties. I’m in my late, late nineties, my late thirties, feels like sometime. Late 30s now, I’ll be 40 this year. So my early twenties, I moved out to Southern California. I’ve had many, many lives and many careers and everything. Worked in live music, worked at publishing a music magazine. I’ve had a lot of odd jobs, a lot of things like that working since I was 15. Early thirties, stumbled upon startup world. It was startups were like Airbnb and Twitter, what is a startup and caught the bug and really wanted to start a company. And so I started doing all this research about startups and invest, like finding an investor, and all sorts of things. And I learned that 90% of all venture funding goes to white men. And this was like 2011 or 12.

Arlan Hamilton (13:00):

And to me that didn’t make any sense, because there are so many, they only make up one third of 30% or so of the country to begin with. So they’re already overexposed to the capital. And second of all, there were so many people of color, black people, women, LGBTQ, et cetera, who I knew, who had really great companies and I and, and in the venture space. And I couldn’t, I couldn’t understand that number. So I over the years decided I’m going to raise a fund to invest in many of us rather than try to invest, just have some investor invest in me. And that’s not easy to do when you’re a, when you have no money of your own. When you have a negative bank account, you have debt. Um, uh, housing insecurity, was on food stamps for part of it, um, all kinds of circumstances. But I knew the whole time that I was doing it, even at the worst times, that it needed to exist. And so I just kept going and 2015 in the fall, I got my first, yes, my first investor after several years of trying and then I just haven’t looked back.

Shontavia Johnson (14:08):

So when you’re doing that, when you are going through all these different early stages and you’re getting nos before you get to the yes. What keeps you going? How do you know that this is the thing before you get that yes?

Arlan Hamilton (14:22):

Well, in this particular case it was in knowing that if I kept going and I was able to succeed in raising this money, that money would help propel these amazing founders who I’d already met, like. It wasn’t like I was thinking that they may exist or hoping that they may exist once I get the money. I was chased, the deal flow was chasing me and I was chasing the money to get to the deal flow. So that was a lot of fuel to the fire. Knowing not, not just like a goodness of my heart, but like as a capitalist, like saying awesome companies. I want to, I want equity and I want a piece of that because they’re so great. And so that that was a lot of fuel. And then thinking about the impact was really important too.

Shontavia Johnson (15:09):

So why do you think there was such a disconnect between Silicon Valley and existing investors and the start up companies founded by people of color, women, people in the LGBTQ community? What, what was happening?

Arlan Hamilton (15:22):

I think there are a few things. I think there was some blatant, um, uh, laziness going on among the investors. I mean, just straight up. We don’t want to learn what we don’t already know. Then there are others who didn’t necessarily have that laziness, but they didn’t know what they didn’t know. They didn’t know. And that’s what they call it, unconscious bias. They didn’t know that they were overlooking people. And I, and I, those, I found those to be interesting because if they, once they found out, they were like, Oh, this is an interesting opportunity, you know. I didn’t necessarily grow up with, uh, lots of women around me to know that they have a particular, uh, unique view of this type of a company, you know? And then I just think, media the way that we’re represented a lot of times, so people are represented, in good and bad ways can, can mean a lot. And I just think that not only the media, but what was really happening was like money was going to white man because it was, that’s how it’s always been been. Then, those white men, because they had support, were doing well and succeeding. And then people who put the money in them say, well that must be who succeeds because it is so, so it was like this manifesting itself sort of situation. And it got real homogenous, real fast and real boring real fast. The, the floodworks in the last five years you’ve seen, so many of us have really succeeded in and changed that narrative.

Shontavia Johnson (16:57):

Yeah, no, that’s excellent. And so you are doing this work, you’re changing the narrative. You get the first yes. You mentioned the first. Yes. How’d you get the first? Yes.

Arlan Hamilton (17:07):

That’s a whole story. I mean that’s a, that’s what I have the book, you know, because it’s a long story, but it really was persistence. It was being consistent with my message and what I wanted to, what I wanted to be doing with the capital. It was being authentic and being patient, and being patient with the investor who was taking a look at me from May to September in a time where I was homeless. So that was not an easy May to September. Um, and it was them seeing that, yeah, you’re right. These, these founders are just being overlooked. It’s not that they’re worse than somebody else, they’re just being overlooked and we want to see if there’s an outsized value to that.

Shontavia Johnson (17:52):

Yeah. So you mentioned the book, the book is called, It’s About Damn Time, and I think I first read about it in that Fast Company article about you.

Arlan Hamilton (18:03):

I’m just trying to point at it. [inaudible].

Shontavia Johnson (18:04):

Every time, every time post your bookshelves on Twitter or Instagram, I’m always zooming in trying to figure out what I can read next.

Arlan Hamilton (18:19):

Yeah. I mean I love — I’m always adding to it too.

Shontavia Johnson (18:23):

So I’ll keep zooming. So I first read about the It’s About Damn Time fund in that article about you in Fast Company. Now you have a book of the same name. And I’ve been working through the early copy of the book that you released to some folks. And I think one of my favorite chapters thus far in Chapter 20 – “Write your own invitation.”

Arlan Hamilton (18:48):

Oh cool.

Shontavia Johnson (18:49):

I love, I love that story. I hope we can talk about that story in the book.

Arlan Hamilton (18:55):

Yeah, we can talk a little bit about it.

Shontavia Johnson (18:57):

So you talk about how in difficult situations, there almost always is a work around, right. And that, you know, you always have to act like you belong. And I think that resonates with me because my father used to tell us the same thing. I don’t care who you are, I don’t care where are you from. Act like you belong in a space. And you tell this story about how you navigated a difficult situation. You got to hook up from a black woman who happened to be working in a space at that time. Do you mind talking a little about that story?

Arlan Hamilton (19:29):

Yeah, it was, yeah, I was early in the process, so I had already raised a little bit of money and I was trying to get this very particular investor, billionaire investor, to put in just a few thousand dollars into the fund that would be very meaningful at the time. And so I found my way into an event that he was speaking at, a big high profile event he was speaking at, where he was like headlining the conversation on stage. And I was the only black person in attendance that I could see. And, I wanted to talk to him cause I had talked to him a little bit on email, but I wanted him to see me and talk to me and I, and I didn’t know exactly how to do that. So the other black people who were there were servers and I went up to one woman and I just, all I wanted to do really was just like ask her like, do you know, I don’t even know. Like, do you know how I can… Where the stairs are? You know, like I was just kinda like trying to get her to tell me some little information and she ended up the clutch like the hookup. So I told her, I was like, you see that guy on stage? I need to to meet him, talk to him. She didn’t ask me any questions. She didn’t know who he was. She could care less. She said, well I know he’s supposed to be getting his makeup done and get to do a video interview cause I heard, cause I’m supposed to send them some food or something. So there’s only one way to get there, though, if you want to get there before he gets there. And I was like wow. So we’re whispering, because he’s on stage speaking. So there’s an elevator behind us. There’s a bar to our left, there’s an elevator behind us, and then he’s speaking to our right and to the front. And she just, she goes, this service elevator will take you to him, take you to where he’s going to be so you can get there before he does and then nobody else will have access to it.

Arlan Hamilton (21:18):

So she puts her hand down. She doesn’t it– We don’t look– we don’t look at each other. We kind of stay in the side by side. She puts her hand down, she pushes the button to the elevator. I slide back in the elevator, I slide on back, like the Homer Simpson GIF, and then she pushes the button to go up and I head on up. And I’m there when he gets there. He has 30 minutes where he has to get his makeup done. I’m able to talk to him, ,uninterrupted and he had seen me online before, so he wasn’t completely like taken out of nowhere with it. But it was a, it was the hookup and we had a great conversation. I’ll talk more about it in the book, what we talked about and how it turned out.

Shontavia Johnson (22:04):

No, that’s an incredible story for so many reasons, but it also…

Arlan Hamilton (22:08):

I want to find her.

Shontavia Johnson (22:11):

You have to find her, send her a copy of the book, a shirt, a hat. But it’s a metaphor almost for what you’re doing. I mean you are opening the doors of access to people who might not otherwise have it. And I just so applaud and appreciate the kind of work you’re doing for that reason because it’s hard. It is hard. Right?

Arlan Hamilton (22:32):

That’s true.

Shontavia Johnson (22:33):

You’re very welcome. It is hard. And so can we talk more about the book a bit?

Arlan Hamilton (22:37):

Sure.

Shontavia Johnson (22:37):

So you, very intentionally so, say I’m a capitalist, I’m looking for opportunities, but your book, like even the chapters are broken down into things like relationships, resiliency, authenticity. So what made you go the more emotional intelligence route with writing the book?

Arlan Hamilton (23:00):

I think you can be both at the same time cause I am both at the same time. I mean, I, I am a capitalist in that I want to capitalize on opportunities, but I don’t necessarily necessarily believe that other people don’t get to have, if I have, and vice versa. I want to, I want us all to thrive. That’s what I talk about in the book. Like I want us all, I want to see us all winning. So I don’t think you win by just knowing X, Y, Z, spreadsheets, his this and that, I think you, it has to be a combination. So I tried to make it both. I tried to make it, it’s a business book that you can reference when you need to think about ways to building your empire, but it’s also something that can be inspirational, aspirational, um, and, and help you, you know, just know what I, what I’ve gone through and what how I’ve come out of that.

Shontavia Johnson (23:53):

So you’re giving the people everything, some business, some emotional life, all of it wrapped into one. And I’ve also seen that you have a class now teaching people how to raise money in their business. Could you tell us a bit around in it? That’s right. Okay, awesome. So with the class, is it literally ground zero, I’m thinking about a startup. Do I already have to have a startup?

Arlan Hamilton (24:22):

So I’m glad you asked that question specifically because what I did was I just made a flow chart, just last night, that helps people know exactly where they stand with the class. So if you go to, itsaboutdamntime.com where you can also preorder the book, or pick up the book depending on when you hear this, if you go there, itsaboutdamntime.com, look up Arlan’s Academy, which is in the menu. Scroll to the bottom of that Academy. There’s a flow chart, so it just takes you through. You ask the question, do you already have a company or you, you want to start a company, you haven’t launched yet? Depending on what you’re doing, go over here, haven’t launched yet? Do you have an idea already or do you, do you still need time to look for an idea? And that’ll take you through and then it’ll take you through.

Arlan Hamilton (25:06):

The way that it’s set up is, you can be at, it’s called How to Raise Capital for your Company from Scratch. So it’s really for people, the people who are going to get the most out of it, already have at least an idea or a company and they’re trying to raise money for it. But it’s really for people who want to get a head start on how do I even think about what I want this company to be, why do I want to have it? And you know, the more groundwork you can do, the better. So that’s why there is a lot of benefit to people who have, who don’t even have an idea yet for the company, so that they start off on the right foot. It’s also good for people who, like I said, who have all the ideas or have launched and then it’s good for people who have already raised money, people who already know that, it’s a refresher course and it’s also doubling down on some of your preconceptions. Because I’ve seen 6,000 plus companies come through in the last five years. I know a thing or two about pitches, and about what investors want. I’ve raised millions of dollars. I’ve earned millions of dollars in revenue in the last five years. So there’s a lot I’m pulling from in this course. And so I think the people who are gonna get the most, most out of it are the ones who already have an idea and are launching it or have already launched it. And then the other, it broadens out to others.

Shontavia Johnson (26:30):

Great. No, that is such a useful resource because it is and it’s a whole world, right? And you’re pulling in all these different resources.

Shontavia Johnson (26:39):

So my final question is about money because you know, people of color, women, we can have some emotional baggage when it comes to money, the way we were raised or the lack, lack of money. And one of the things that I’ve really respected about your work as you continue on this trajectory is you give back. So you have scholarships. I saw that you announced you are creating more scholarships, you’ve donated money, you have a new nonprofit, Project Cover. So how do you stand in your truth of wanting to make money but also balance that with wanting to help other people?

Arlan Hamilton (27:17):

I want to make money. I want to be wealthy and probably give away 80% of it. I’ve never, I’ve made no, um, you know, secret of that. I want to make money because then I want to spend it the way I want to. So that, in that way I, I agree with some billionaires, you know, some of them are like I don’t want the government touching my money. So I think it can be both. I think you can do, I think everybody is allowed to do whatever they want legally to make money, make as much as they want or as little as they want and then do with that what they want. And one of the things that I want to do, a major part of what I want to do is use wield that power as a gay black woman in ways that I haven’t necessarily seen patterned for myself.

Arlan Hamilton (28:06):

I want. That’s why I’m, I mean, I’m doing a scholarship at Oxford with my mom for a black scholar because it didn’t exist before. They didn’t have, it was a very first one they have for a black scholar.

Shontavia Johnson (28:18):

Really? Wow.

Arlan Hamilton (28:20):

These are the types of things that I’m trying to do. I’m trying to make these steps that are just not like, not just the norm. I’m trying to like break through, you know, break, break through and be… serve as a case study so other people can do it. So they can see how to do it. I’ll leave the breadcrumbs, show you how to do it, and then it just all feeds on itself. So the book, It’s About Damn Time, most of the advanced money I made from that, and I made a good deal on that, I put back into Backstage. I used it for operating costs and for investment capital. I’m going to continue doing that kind of thing. I’m going to use some of it for philanthropic measures. I’ll use some of it to invest in myself. I’m gonna use some of it to have a second home. I’m gonna do what I want. You know, like that’s that, that’s that power that you get by holding onto your equity and holding onto as much of that power as you possibly can.

Shontavia Johnson (29:12):

Oh, that is awesome. Thank you so much for chatting with me, Arlan. This has been incredible. Look forward to reading the book at itsaboutdamntime.com, right. We can preorder it now.

Arlan Hamilton (29:24):

You can pre-order it and become student of mine at Arlan’s Academy on the same website.

Shontavia Johnson (29:27):

Excellent. Well I will be doing both. Alright.

Arlan Hamilton (29:31):

Thank you so much.

Shontavia Johnson (29:32):

Thank you.

Arlan Hamilton (29:33):

Thank you.

Shontavia Johnson (29:35):

Yeah, so thank you for that. I appreciate it. And thank you for donating to the Phoenix Rising Virtual Summit too.

Arlan Hamilton (29:40):

A hundred percent a hundred percent. I’m so excited about it.

Shontavia Johnson (29:44):

Yeah, thank you.

Arlan Hamilton (29:45):

Thank you. Have a great day.

Shontavia Johnson (29:47):

Have a good weekend.

Arlan Hamilton (29:48):

Okay.

Shontavia Johnson (29:48):

Thank you so much for listening to this episode of The Shontavia Show. If you enjoyed this episode, please be sure to like, subscribe and leave a comment wherever you’re listening. You can find me on social media everywhere, Facebook, Instagram, Twitter, LinkedIn, and wherever else @ShontaviaJEsq. You can also visit me at shontavia.com to find a transcript of this episode along with other show notes. While you’re there, please be sure to subscribe to my email newsletter.

Shontavia Johnson (30:20):

The information shared in this podcast and through my other platforms is designed to educate you about business and entrepreneurship and I love to do this work. While I am a lawyer, though, the information I provide is not legal advice and does not create or constitute an attorney client relationship.

New Speaker (30:38):

The Shontavia Show is a LVRG Incorporated original. The show is recorded on site in South Carolina and produced at Sit N Spin Studio in Greenville, South Carolina. Original music and sound design is by Matt Morgan and Daniel Gregory. Mixing and mastering is by Daniel Gregory and the video is by GVL Media.