I run a venture capital fund for women of color. Here’s how to stand out.

  • Arian Simone is the co-founder of Fearless Fund, which supports businesses run by women of color.
  • Investors include Mastercard and PayPal, and it has backed 31 consumer and tech companies so far.
  • Here is his story and advice on how to stand out to investors, told to writer Claire Turrell.

This say-to-say essay is based on a conversation with Arian Simone, the 41-year-old CEO of Fearless Fund in Atlanta. It has been edited for length and clarity.

When I was in college in Florida and raising capital for my women’s clothing business, I learned that very few people who cut checks looked like me. Just before my store officially opened in 2002, I promised myself that one day I would become the business investor I was looking for.

When I graduated, I closed my business and moved to Los Angeles to work for Nelly’s AppleBottoms jeans brand and place products on celebrities. Then someone who had seen my work offered me a freelance PR and marketing job. They then referred me to other companies and I started building my rolodex of contacts. In August 2004, I started my own public relations company serving Disney, Universal and Sony Pictures in Los Angeles.

As I started my own business, I never forgot the promise I made to myself. I supported friends’ businesses as an angel investor, but as I knew Black women receive less than 1% of venture capital funding, I wanted to do more. In 2018, Ayana Parsons, whom I met at Florida A&M business school, and I decided to launch Intrepid Fundwhich supports early-stage startups founded by women of color.

I had moved to Atlanta to be closer to my family, and this forward-thinking city was the perfect place to launch our fund. I left my PR company to focus on the launch. It took about a year to complete the legal paperwork, become SEC regulated, and establish ourselves as a fund.

Ayana and I started increasing aggressively in 2019

If I said it was easy, I would be lying. I went two years without pay to start the fund, but I continued because I knew how many people would eventually benefit. Since the venture capital industry was new to me, I looked for mentors and emailed Rodney Sampson, professor of entrepreneurship at Morehouse College in Atlanta, and Tracy Gray, a venture capital Fund 22. I told them I wanted to start a venture capital fund for women of color and they immediately offered to help.

When creating the fund, we also built the Intrepid Foundation which organizes workshops, online courses and conferences for entrepreneurs. We then went on to create the Get Ready Venture Program, which provides founders with the knowledge, grants and tools they need to build scalable and engaging businesses. We now have 54,000 subscribers on instagramand word quickly spread among the founders when we announced that we were going to create a fund like this.

Fundraising proved to be a slow process

We originally set a goal of raising $5 million. Although we were lucky enough to attract individual investors like my friend Keshia Knight Pulliam from Tyler Perry’s “House of Payne”, we realized that we needed to focus on attracting institutional funds.

The first team we met was the non-profit lending institution Local initiative support company, which made a $750,000 investment in October 2020. We explained that women of color generally feel more comfortable presenting to women of color. We also showed how we support our entrepreneurs by helping them with marketing, recruiting, digital and connecting mentors.

As soon as LISC invested, it created a domino effect, and PayPal, Bank of America, and Mastercard came on board. We have decided to increase our target and set a new goal of $25 million.

Rather than wait until we hit our new goal, we started investing in startups and writing checks up to $500,000. Our early investments included the rain hat company hairbrellathat Tracey Pickett, a lawyer, founded; enrich it, a fintech platform for women entrepreneurs; and Ellis Island tea, founded by Nailah Ellis-Brown. We could say, “Look at their traction, look at their team, look at their product market fit – they’re onto something amazing.” Instead of using charts on a PowerPoint to show potential investors what we could achieve, we used these concrete examples of what our investments could do to raise more money.

Since then, we have backed 31 consumer and technology companies, and after two years, we closed our first fundraising in November 2021, which reached $25 million. We have also opened our second round and aim to raise much more.

This space needs more capital. It’s gonna take trillions to move the needle 0.34% women of color currently receive in venture capital fundingso we are only the beginning.

Here are my tips for startup founders looking for funding.

There are 4 key metrics we look at when talking to a potential portfolio company

We’re looking to see what their brand story is, what their market traction is, how strong their team is, and how good their product is. If you passed all four, you passed the test.

Traction is not necessarily money. The tech industry is capital-intensive just to get started. So your pull might be that you have 100,000 users. For example, when Instagram was sold for $1 billion, it hadn’t generated $1 in revenue.

Investors may be watching you for a while, so share your successes

We get 1,000 applications in a week, but the one that stood out for me was Pickett from Hairbrella. She’s a great example of a great team, great product, and great brand story, but when I first met her in June 2019, her appeal wasn’t quite there. . She was only making $1,500 in sales for the month, and when we invest in a CPG business, we want her sales to be between $500,000 and $1 million. But I had a conviction, an intuition.

So I followed her on social media and waited to see what would happen. In September 2019, she posted a six-figure month on social media. Then she did the same in October, November and December, so in January I called her and asked her if she was still interested in funding. She said, “Sure. I just booked ‘Good Morning America’ and they told me to prepare for a six-figure day.”

Some VCs will invest and others will also choose to mentor

Some venture capitalists are passive investors, while others are more active. Think about the type of investor you want as you go through the fundraising process to find the right one for you.

We provide a lot of support to our entrepreneurs. We have marketing agencies on board to help with go-to-market strategies, influencer marketing and digital marketing. We also have a talent agency to help them with C-level talent, and we have a mentorship program. We assign each of our 15 team members a number of businesses to support, and they connect with each at least once a month.

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