Lisa
I’m Lisa Calhoun, General Partner at Valor Ventures. I am so excited to welcome the keynote of the ninth showcase of Startup Runway, Ryan Wilson. He’s the CEO and Co-Founder of The Gathering Spot which is far more than a company. It’s actually a movement. Ryan, please take it away and share with everyone a little bit more about what you’re building.
Ryan Wilson
First, Lisa, it’s good to be with this community. I’m so honored. I remember when Startup Runway started and to think now, what a beautiful community this is and a beautiful platform that this has developed into. It’s really humbling to see. I’m glad to be a part of this year’s event even though we are not in person, there’s still a lot for us to talk about. I appreciate everyone for joining us.
This is a quite difficult time we’re in as a community. I’ve been thinking a lot and I’m sure as you have over the last several weeks. One of the things that I want to discuss is that, frankly, I don’t think it is enough. A part of the agenda is just the importance of elevating black owned companies and black leadership within organizations. Now, some will say, why is this important? I thought we’ve had this conversation. Indeed, black lives do matter but I think it’s important to put context around what we are seeing. There was an active discussion this year about Juneteenth. One of the things that I don’t think was reported enough is that if you go back to 1865, black folks in this nation had about one half of 1% of the nation’s wealth. Well, if you fast forward till today, that’s about one and a half percent of the nation’s wealth. we’ve made about 1% gain over a 155 year period. There’s a lot for us to work on. While conversations over the last several weeks have allowed us to get to know one another better and to talk about historic injustices that have occurred, we’ve got to continue to make sure that our community is focused on what’s ahead of us. As that applies to the startup community, there’s tremendous opportunity. Black companies, like any other company in our ecosystem, have the potential to produce meaningful solutions but also build meaningful teams that will have an impact on our world. I know it sounds obvious to say that we should prioritize these companies and make sure that they have an equal shot. I know that this community is with me in that effort but it’s important for us to make sure that we include folks that are not a part of this conversation. What happens when you watch black companies scale are amazing things. It has an impact on nearly every other part of our society. If we’re talking about education, housing, or health care, the ability to have a thriving business ecosystem really is fundamental to the survival of all of those other parts of the way that we interact with one another and that the infrastructure that we participate in. So I didn’t talk much about The Gathering Spot but I’ll say a quick word about it before we continue on. I started TGS out of my apartment in Washington, DC, with the simple goal of creating a platform that would bring people together. I had no idea what I was doing. When I started, it was a really interesting time period in my life. I was working for a law firm back in Atlanta, and it was the same summer as the Trayvon Martin case. What was special about that summer is that I watched it every single day so much that the IT department at the law firm came into the office one day and asked me, “What are you watching in here?” At the end of that summer when George Zimmerman was acquitted, I got an email from some friends that asked me, “What are we going to do next?” I sat on an email for a while because I didn’t really know what to say to them. When I decided to respond, I came back with an idea talking about what if we had a place where people could meet, gather and learn from one another. What we do at TGS by way of space is we have an event space, a restaurant and bar, and a workspace but the business has always been centered around people. We’ve taken an important and very special interest in the events of the last several months because our mission has always been rooted in engaging these issues. Black leadership, which was one of the fundamental topics that I had to explore as a 23 year old with the dream at the beginning of this process, it’s something that I’ve had to learn a lot about over the last several years. What I’ve learned is that when given the opportunity, companies like ours that statistically for just being honest, wouldn’t have an opportunity under normal circumstances to even exist and go on to be able to have meaningful impacts in folks’ lives. If there’s any way that you can have an impact with a black owned business, whether that’s being a customer, a supporter, or someone that just says a nice word on the internet, any and all efforts during these times matter. Because indeed, if we’re going to move forward together, we have to understand that it only is going to happen if we’re being intentional and keeping our eyes focused on the power of what happens when good people sit down, think about the things that actually can get accomplished, and then work diligently to make them so. So, I’m glad to be here. I’m gonna pause for a second. I know that was a longer intro.
Lisa
That was fantastic! Not everyone who’s attending Startup Runway, we have a lot of repeat people. We have a lot of new faces. One of the exciting things about the whole pandemic process is allowing us to go digital. Our first home was at The Gathering Spot. Thanks to the generosity of Ryan and his co-founder TK Petersen. That is why The Gathering Spot is a co-host forevermore. We could not do it without the support of the platform and the team. Now that we’re in a purely digital environment, we get people from almost every state who are really interested. For some people, this is their home. It’s a [home for] diverse founders, inclusion, and Black Lives Matter. But for others who are listening, this is the first event that they’ve attended in the inclusive ecosystem. I just want to encourage you to riff on that topic of why black leadership matters. Why do you think it matters, Ryan?
Ryan Wilson
I think this is such an empowering and powerful platform because what we see here is what happens when people are intentional. I have to commend Lisa and the entire team from the beginning of thinking about how to make sure that founders that ordinarily don’t have an opportunity to participate fully in the process [are included]. What I mean by that is just as a founder of color, we see the statistics. It’s very difficult to get funding for all entrepreneurs but it’s certainly difficult if you’re a founder of color. This platform is important because what it does is it exposes us to what we know intuitively exists, great companies and great founders, but it also shows us leaders in our community that are doing powerful things. I’ve always been proud to be a small part of what happens with Startup Runway because, again, true to the mission from the very beginning, it’s about making sure that we’re being specific about who we’re targeting but at the same time, knowing that when we stand by founders of color, that there are equally amazing results that can come from those founders.Today’s event is a celebration of that as much as anything else.
Lisa
I would argue that even greater results can come from diverse perspectives than the results two to four. I feel like the investment community, and a number of our attendees are investors, who’ve been satisfied for far too long with mediocre returns that come from homogenous sort of same old team approaches and outsized returns come from outsider perspectives. That’s the power law and power law distribution is fairly well understood in financial circles and doesn’t necessarily come down as much to first checks. The fact is, I was just looking at the US Census data yesterday, the population under 40 is over half the US. That makes sense. Guess what? Half of that population is female, half of that population is racially diverse. The reality is today, our buyers, our customers, and many of our founders are living in a very intentionally diverse and inclusive world. If you don’t invest into that speaking as an investor, you will have missed your dollar. You will have missed your opportunity.
Ryan Wilson
I think that that point is so important because what it demonstrates is that beyond the moral arguments that have been used and I think rightfully so as to why we should work at the intersection of racial and economic justice, we also are starting to see that it makes just pure business sense, right? If the moral arguments that you hear are not good enough, the numbers are showing us that this is the direction that our country is moving in, and that there are tremendous opportunities there that we should take advantage of. I mean, we’ve collectively gone through a history that has not allowed all founders to have an equal shot at this American experiment. But we are at a time where just the demographic shifts are making it so where we need to start prioritizing making sure voices that have not been heard, are heard. We’ll see that on the other side of that journey, we will make an impact in our communities and create jobs that will solve problems for people but what it’ll also do is make the returns that make all of these models work. I’m excited that we’re having that conversation kind of in both ways. Talking about why we should do it but also just getting to the dollars and cents of it all which I think is extra incentive to make sure that everybody pays attention to the shifts that are occurring.
Lisa
When you’re making some great waves on that yourself. Without asking you to share any private company information, I would love for you to share with our viewers here in the community some of the growth you and TK have experienced at The Gathering Spot with your intentional inclusion and focus on diversity. It’s striking and in whatever level of depth you’re comfortable sharing, take us back to the beginning and where you are today.
Ryan Wilson
In the beginning, we had nothing. I was in my apartment dreaming that one day, we would have just anybody that would pay attention to what we were trying to create. I’m grateful each day. I always say, more than being in the space business, we’re in the community business and that is what we’re centered on each day. For any entrepreneur that’s watching this, what I would say is a word of encouragement. One of my favorite quotes is, “You cannot lead people if you don’t love people.” I think that quote applies to anything that we’re trying to solve by way of a problem that a business is pursuing. It is super important to make sure that you love the people for whom you are trying to solve whatever the problem is or the solution that you’re trying to craft, and that you love the people that you’re creating it for. That, to me, is a part of our secret sauce. We stay super focused on the community of people that I’m humbled to say, has continued to grow despite terrible circumstances because we’ve stayed focused on making sure that they had connections to one another, and connections to the business. That’s both in sharing information, keeping folks encouraged, and overall with the knowledge that we’ve got their back. If any company pursues that goal, I’m pretty confident that you will make it to the other side of what we’re facing as a community. You have to remember to continue to genuinely love the people that the company has the opportunity to serve. Somewhat connected to that and just one thing that I think is something that I try to say to myself to stay encouraged during these times, is that we are fortunate each and every day as entrepreneurs to be the people that get to solve the problems that our companies face. Each time that I start to get sad about anything on any challenge that we have in the business, particularly over the last several months, I go back to the idea that I’m grateful to be able to solve this problem. If I continue to lead with love and with a sincere interest in making sure that my customer base or membership community is taken care of, that we in turn will be taken care of. Always focus. If there’s anything to chase, chase solving a problem for folks, the membership community, and the community around your business will grow. At least that’s my experience.
Lisa
I couldn’t agree more. I think entrepreneurship is a response of the human spirit to solving the biggest problem our civilization faces. It’s impressive to see founders like you and so many in our community, today doing that. One of the things that we focus on at Startup Runway is that first check. Ryan, what are some experiences you can share with the founders with us today about getting that first check? Also, I’m going to be blunt and say, kind of separating the tire kickers from the series investors because these days I feel like especially every founder of color is getting inundated with, “Please teach me how to invest in a founder of color.” as if it’s any different. I’m just gonna let you take it from there.
Ryan Wilson
There’s a lot to say in this topic. The first thing that I’ll say is go back to the reason why you started a company. You need to take an assessment of why you got started in the first place and hold on to that. Trying to find funding can be a very, very difficult process and I think, in many ways, is designed to test how connected you are to whatever your why is. One thing early that we did is that we received a lot of Nos but when we received those Nos, we tried to reframe them as seeing something in the market that investors didn’t see. You may be talking to extremely talented people that are investors, there are many investors that are participating in today’s event that are amazing and very well accomplished people, but I think that many of them will also be honest with you that they don’t see them all. Experience in one area doesn’t mean that they see the problem that you’re solving. You, as the founder, have to be the head cheerleader for your business and know that if anyone is going to be confident about what you’re building, it’s you. Don’t let anyone shake your confidence in what you’re doing because it is your responsibility but more important than that, it’s just a unique opportunity to wake up each day and to be the person that’s championing an idea. Do not ever, I could go on in the fundraising piece for a long time, but do not lose confidence. Know that you’re the best person to solve this problem in the world and carry yourself with the confidence that it’s you every single day. There are going to be a lot of people that don’t want to join you on that journey. One mistake that I also made early on is that I didn’t understand the fundamental thing that investors really want to hear, which is how are they going to get their money back? I would talk about really everything else. I talk about how great the company was in space and my passion for the business. I think those are all things that a good investor will look for but you always have to draw those things to the opportunity. Stay focused on why your opportunity is something that they don’t want to miss and let them know that as long as it’s up to you, you are going to do every single thing possible to make sure that this thing exists in the world. That is contagious. Folks will join your efforts and it may not happen overnight, but it will happen. I believe that as a founder, the dreams and aspirations that we have for our businesses, they come from somewhere. They’re rooted in something. You’ve got to know that even on those dark days when folks tell you no and it feels like you’ll never get the capital necessary, that there’s a reason why you have the idea that you have and to stay connected to it. Because if you continue to just put one foot in front of the other, it will exist. I don’t believe that there’s any one person or institution that can stop a good idea from getting the market when people need it, especially if a good founder is pushing you consistently. Keep pushing. Platforms like this and communities like this, no matter what happens here today, right? This community and this network is powerful. Yes, we’ll celebrate a winner today but we’ll also create bonds that will go on to create meaningful opportunities down the line and stay focused on that as well. You never know that the conversation that you’re having today in 2020 may be the breakthrough that you need in 2022. Play the long game and understand that it isn’t going to happen overnight, but you’re the best person to do it and it will happen.
Lisa
Ryan, that is some wisdom. Thank you for sharing that. One of the things that you’re really successful at is building, not just community as a business, but also community within your team. One of the things I’ve always been impressed with the business you and TK are building, I’ve always been impressed by the inclusion that you have even in your team. I’d love to have you talk a little bit about how you actually see inclusion. I know you’re sort of flying the plane and building the wings but a little update on that and some experiences some lessons learned would be really helpful, I think, for the founders in the room.
Ryan Wilson
To every founder in the room, understand that your team is your most valuable asset in many ways. They’re the people that are going to be in the trenches with you each day. There are different ways to build teams. As a leader, I prioritize making sure that I’m very transparent with my team that they understand what my objectives are for the business. I work with them each and every day. Every hour that I ask them to work on the business, I make sure that I’m available for it as well. I let them know that it is my job each day to give them the tools necessary for them to be successful now. Because we’re building a company that is scaling, I want them to be participating in that growth as well. Focus on making sure that your folks know that you’re with them for the long haul in the business and that where they started might not necessarily be where you want them to finish. A lot of times I tell folks in interviews, while I might be hiring for the job that we advertised for, I’m really thinking about six to nine months from that point where I will have a different need in the business and want them to be a person that will be well positioned for it. Encourage your team and know that particularly in the startup context, it’s okay to work with folks that have a ton of passion for the business. If you’re like me, I opened this business when I was in my mid 20s. You may have to grow up with your company and your team in many ways, and that’s okay. That’s a beautiful part of the journey. Believe in your folks, trust them, let them make mistakes, you make mistakes as well. At the end of the day, if the relationship is rooted in that mutual goal of trying to make whatever your mission is happen, they will. They’ll be with you for the journey. Our folks, I’m grateful to have been with us since the very start, not in the roles that they started with us in, but definitely still deeply connected to why we do what we do each day.
Lisa
Founders of color and women are certainly funded at extremely low rates which is why we talk about underrepresented founders. I know you’re really familiar with this as building your business but also you watch so many entrepreneurs in your membership base. What are some of the numbers that you find most meaningful that if these numbers started to change, we would know that this culture was changing and moving in the right direction?
Ryan Wilson
I look at three numbers, and I’ll try to limit it to just three. I think the first number that we need to look at is just the opportunity for founders to have access to capital and for their initial rounds to be raised and to have them be successful. Next to that, we’ve got to look at revenue. Unfortunately, we went through an error where revenue seemed to be a little bit of a lost art and depending on what business you’re in, it may make sense so I want to be careful there. A business might take time to mature but there still has to be an eye on making sure that the business at a fundamental level at some point can get to a place where it covers its expenses and has the opportunity to go on for more. Third step that I really pay a lot of attention to and that I wish that we talked a lot more about is opportunities for employment. It is super important, particularly with founders of color, that we create capacity in our communities to allow people to be a part of the companies that we’re building. Unfortunately, over the last decade or so where around 90% of black owned businesses don’t have more than a single employee. That’s a statistic that we have to change. Next to that, it’s a very high high 80s of in terms of percentage of the number of black companies that don’t, from a top line revenue perspective, do over $100,000 a year. We’ve got to work on that. We’re specific about making sure that founders have the capital they need to get started and that they’re well capitalized through the ideation into execution and have the ability to scale and focus on revenue, and then look at the impact that they’re able to make by way of employment. We will be in a better place. Conversations about these things, great statements about these things are all well and good but we have to make sure that the numbers back up what we’re saying, which again, will look like having more black owned companies at scale. One of the ways that I would encourage everyone to think about no matter what industry we’re talking about, a lot of minority owned companies that exist at scale in any industry. We have to work on that. We should be able to point to almost any industry and point to a minority owned business that we’re proud of and that has gotten to a significant scale that we know is having a meaningful impact and solving a real problem. The fact that we can’t do that in many contexts is the real opportunity that exists out there. For the investors that are watching, thank you in advance for your participation in supporting these companies because that is the start of the process to making sure that we get to a different future.
Lisa
Thank you in advance for your participation, Mr. and Mrs. Angel, an investor in VC out there. But also which side of the bread is your butter on? For example, Marlon Nichols, who is the GP and Founder of Mac Venture Capital and was with us at Startup Runway just last May. He did a study with Kauffman Fellows that came out February of 2020. It showed over the last 10 years and 20,000 startups that diverse founding teams returned 30%, that’s three zero and that’s a big number, offering additional capital to their investors than others. I tell you what, if that doesn’t get your heart pumping as a VC or as an angel, I don’t know what does.
Ryan Wilson
Again, this has gone beyond conversations of morality, I think it is the right thing to do. We are looking at significant business opportunities here. I think that that should hopefully be the thing that closes the loop here. If we understand just the potential that’s out there, we look at cities like Atlanta and all of the wonderful things that Atlanta creates, we should be able to say alongside of our creative endeavors and our political accomplishments and even what we do by way of sports, that we have companies that are in our communities that are growing, providing opportunities for people, and returns for their investors. That opportunity exists and it is an open door that we need to really take advantage of in a way that we have it. Again, I think that this is an opportunity. Why I appreciate communities like this is that we can have these conversations in a really intentional but plain way where what we’re able to accomplish here today, there are fantastic companies that are participating and Startup Runway, and if given and I will dare to say when given the opportunity to be successful, they will drive all of the impacts plus some that we could ever hope for. We’ve got to invest our treasure but also our time in making that so and when we do, I think we’re gonna again be really proud of what happens on the other end. It’s the right thing to do but it also is going to make the most business sense
Lisa
It’s absolutely the right thing to do. Fortunately it makes fantastic business sense for those that aren’t simply compelled by that alone. Harkening back to an earlier conversation we had, black leadership is very clear in multiple industries, whether you have music, all kinds of arts, but not necessarily in business to your earlier point about how not every sector of industry has a minority-led firm that is at the top of the stack and the top 10 companies in that industry. Could you share a little bit more about why you believe that’s the case today and what it takes to change?
Ryan Wilson
I’ve got a very short response to this one, I think it really centers around access to meaningful capital. If you don’t have the opportunity to start, we know that the way that we have structured and the way that companies get started in our communities, which a lot of times starts with friends and family. If you go back to the beginning of our conversation, unfortunately, wealth doesn’t exist. The liquidity doesn’t exist in communities of color to be able to meaningfully invest in companies in the early stages. We also know that there’s a different risk profile with these sorts of investments. Where we have to get very specific is standing in that gap and making sure that companies that have a phenomenal idea have a chance to explore that idea with the capital necessary to actually make a true attempt at the business being successful. What we don’t have, if we’re being honest and when you look at the numbers, is a lot of founders that really have that chance. Some folks will say, “Look, entrepreneurs, founders, like yourself, are always looking for more money. There’s always not enough capital in the business.” I will concede that on one hand but say that the stats show us that even for similarly situated businesses in a given industry, we still find that minority owned companies don’t get the same valuations and certainly not the same amount of capital necessary to really get going. That has consequences as we all know. If you don’t start out well capitalized, it’s very difficult to get into that position later. It’s oftentimes hard to have subsequent conversations with potential investors to fuel the business because you might not have been able to show the results necessary for that next round of investment. We’ve got to start it out on every company and like anything else we do on a good foundation. With that said, we will see the companies that have amazing potential rise to the top of our communities and then we’ve got to do everything from that point. This is me speaking here. But to manufacture some wins, I think what this ecosystem could be more diligent about is picking companies that we really believe in and working really hard to make sure that the entire ecosystem supports those companies no matter what. This approach that we have that is rather than a shotgun approach, we believe that every company should have a shot in there. To a certain extent, that’s true. The ecosystem should support founders getting started no matter where they come from. At a certain point, we got to take high potential companies and say, “We’re going to do everything to make sure that you win.” and that might mean capital, but a lot of times, it also means relationships and access to the right conversations to get those businesses to the next level.
Lisa
Monique Woodard says that African American led companies are over mentored, underfunded and gets down to write a check.
Ryan Wilson
I couldn’t agree more. We have to be more specific about sure mentorship, but capital? That’s the root of everything. I mean, in many ways I was having a conversation recently where the company was talking about access to consultants and some folks that would be able to help them think differently about how to pivot the business. But the business didn’t really have any capital to invest in that work. That is, as simple as it sounds, a lot of times the issue. We’ve got to make sure that the businesses have the basic resources necessary to go on and have a shot.
Lisa
Absolutely. I was talking with a large university recently and they said, “How can we change the game around Black Lives Matter and founders of color?” They gave me a list of things to choose from that I thought might be really important. First, I said, “Are you asking people of color? Why are we talking here?” I mean, I appreciate that but still. After we got through that part of the conversation, the list was really everything but capital and I brought up their foundation. Their very large, multibillion dollar foundation that invests in private companies and how much of that is invested in people of color and how much should be. It’s amazing how much people can twist themselves around the issue of not writing a check when it’s very clear that black families in America have a 10th the wealth of white families, to your point of gaining 1% of wealth in 100 years. The issue is the elephant in the room and it’s about capital.
Ryan Wilson
Whatever word we want to use capital, cash, resources, whatever makes folks sleep better at night, but it’s about making sure that the companies have what they need to be able to just have an opportunity to try. I think that we can facilitate that as a community. We just have to be specific about what our goals are and realize that the playing field is not not equal for all founders. There may be specific interventions that we have to create to make sure that at least to try that is available to everyone. Unfortunately, where we are right now, that is not a statement that I believe is true. But through efforts like what we’re doing today, it becomes more possible and we move towards a time where it will become true for all but we’ve got to stay focused on being specific. It is not about individual relationships. We are combating a system that at this point is not really connected to the individual beliefs but constructed in a way that just again, if you look at the statistics doesn’t give everyone an opportunity.
Lisa
I can say as an entrepreneur who is also a member of The Gathering Spot, your entrepreneurship circles and some of the resources you put in front of people of all types to learn more about how to grow your business, to connect to resources, to find the marketing talent, to find the technical talent, to find the encouragement which it takes all of that, I just have to give a shout out. If you’re thinking about joining The Gathering Spot membership is not always available, because sometimes it’s oversubscribed, but it is really worthwhile. Having been a member for a few years now, it’s really enjoyable. It has something for a lot of people including something for me to write. I know you’re really busy and you’ve been very generous. I can’t let you go without asking for your top three tips and lessons learned for founders. I’m going to ask you to really focus on founders of color and share with them from experience. Your top three, “Hey, lessons learned. Here’s what I have for you.”
Ryan Wilson
There are a ton of lessons that I’ve learned. The first thing that I’d say to everyone and I hinted at this earlier but I really do mean this, stay true to the reason why you got started. It is very important to realize that you’re running a marathon, not a sprint, and know why you do what you do each day. There are a lot of things that will happen along the way that will try to shake your commitment to what you’re building right now, but don’t let them do it. Next to that, focus on building a good business that is fundamentally sound but positioned for scale and growth. One of the things that my dad said to me when I started my journey as he said, “Son, small ideas will keep you small.” What he was telling me is that you’ve got to fight for the biggest possible version of your dream each and every day. Don’t ever let go of thinking about the maximum opportunity that exists, and don’t settle, right? Again, there are going to be a lot of things along the way that is there to try to discourage you but don’t ever settle for a smaller version of that thing that you have always been inspired to create. The last thing is to make sure that more than anything else, chase excellence in your product or service. Nothing beats really being committed to creating the best possible version of the thing itself. Be aware of your competition. Don’t be afraid of them but know that you’re the best person to solve this particular issue and you’re committed to creating the best product out there. We live in a time where between social media and everything else, we don’t focus enough on businesses that are just excellent. Don’t chase any of the external validations or headlines. Those things, at the end of the day, have very little importance to the business. Focus on building a good company. If you stayed rooted in your mission, take care of your team and again, focus on growth, you’ll be fine. If there’s any way that I could be helpful, please don’t hesitate to reach out to us at The Gathering Spot. I’m deeply inspired by the folks that I’m seeing that are participating in today’s pitch. And thank you again to the investors that are spending time as well with us because your efforts today are making a meaningful impact. Together, genuinely, we can do something powerful. Maybe that’s my message to everyone. Let’s stick together. We will make it through. We’re living in incredible times right now, economic collapse and social unrest. I think that if we are specific about being there for one another, that we will not only get through this time period but thrive.
Lisa
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