‘We Need More Talented Black VCs.’ Say Less.

“Yo, when I first started recording, I swore it was more important/To make it to Soul Train in a gold chain and some Jordans/Than makin’ my own lane and then blazing a trail forward/I came from the old days where the vision was too distorted” – Black Thought

What’s up, y’all!

I got my first glimpse at the power of venture capital in 2014, when I started covering technology as a reporter in Indianapolis.

Just a year earlier, in 2013, software giant Salesforce acquired locally based tech company ExactTarget for $2.5 billion. It was a massive purchase that made many of ExactTarget’s early employees multi-millionaires overnight (the CEO alone reportedly made $72.8 million from the deal). A lot of ExactTarget alumni took their newfound wealth to launch or invest in a new generation of startups that would, hopefully, repeat the cycle. What made this possible? A key ingredient was venture capital, which allowed ExactTarget to mature quickly, go public and become an appealing acquisition prospect.

I had fun covering the ripple effects of the purchase. But it was hard to shake the fact that Black people were notably absent from ExactTarget’s leadership team, as well as the ranks of venture capitalists who invested in it. No matter who was to blame–individuals or systems–Black people weren’t really there for that $2.5-billion come up. This tale is not unique to ExactTarget.

There are signs of change, including on the VC side. This week we have stories about two Black celebrities who became venture capitalists, driven partly by a desire to make the sector more inclusive. Tariq “Black Thought” Trotter, the lead rapper for The Roots, joined VC firm Impellent Ventures earlier this year and spoke to Forbes about his approach there. And, from the archives, we have a 2019 cover story about tennis superstar Serena Williams and her VC firm Serena Ventures, which she’s expected to focus on more after her retirement from tennis. “I want to be remembered for things I do off the court,” she told Forbes, “lives I’ve been able to impact and voices that have been heard through mine.”

Williams and Trotter are among other high-net-worth athletes and artists, including rapper Nas and basketball star Kevin Durant, who became venture capitalists. The late Kobe Bryant was a successful investor with is VC firm Bryant Stibel & Co., said Marlon Nichols, co-founder and managing general partner at MaC Venture Capital. “I think it’s great,” Nichols said about Trotter getting into the space. “We need more talented Black folks in the business of venture capital, and he clearly has a significant and unique network, given all of the circles and arenas that he’s played in throughout his life.”

While Black celebrities alone can’t alter the lack of Black leadership in venture capital, such moves are still exciting to see, said Jamison Hill, a general partner at VC firm Base10 Partners. And they can bring a lot of value to portfolio companies, he said. “How do you build a brand? How do you connect with consumers? How do you story tell and amplify that message? All of those things are highly relevant for venture-backed companies.”

Stay up!

This newsletter edition published Aug. 31, 2022.

Roots Rapper Blazes A Trail Forward, From ‘The Tonight Show’ To Venture Capital. Tariq Trotter, aka Black Thought, has performed in front of millions on The Tonight Show Starring Jimmy Fallon. Still, he said he felt butterflies when news dropped that he’d be joining venture capital firm Impellent Ventures as a general partner.