THINKING ABOUT HOW WE THINK
Quick, picture a successful entrepreneur.
What does the entrepreneur look like? What does the business look like? What makes the entrepreneur and the business successful?
If you pictured a 20-something white guy, working solo on a trendy digital or social media startup that quickly garners a billion-dollar exit, we get that. And if you thought of the word “unicorn,” not to worry. It just means you’ve been paying attention to popular media. We’ve seen that too.
But we also see something different, rarely covered by popular media, hiding in plain sight.
You Tend to See What You Look For
It’s no surprise that white male founders attract the overwhelming majority of venture capital deals and dollars. They are exactly what most investors are looking for.
What may surprise you is that their female counterparts create equally or more compelling businesses, according to a mounting body of research. See, for example, the excellent overview compiled last year by Elise Zoli and the ROI Factor Project.
Likewise, our experience has been that nonwhite and immigrant founders also excel at creating high-value businesses. Research here is embarrassingly overdue, but localized findings have been presented by Vinit Nijhawan / Boston University and by the Immigrant Learning Center, among others.
Largely overlooked by the investment community, these “other” entrepreneurs represent significant untapped potential.
Look Differently
When we think of successful entrepreneurs, we see white men too, but we generally picture founders who are people of color and women. We picture these founders working in strong teams, and with commercial and community partners. Even legends like Steve Jobs (Apple, Pixar), Oprah Winfrey (Harpo, OWN), and Tony Hsieh (Zappos), could not have succeeded on their own. It takes lots of people working collaboratively to create a high-value enterprise.
We picture these founder teams using technology and new business models to address social and economic inequities through their business practices, products and services. They are maximizing value creation potential not by monetizing shortlived trends, but by delivering superior products and services that people and companies want to pay for. In many cases these are associated with financial, health, energy, or other needs which established corporations are ill-equipped or unable to meet. We see, for example, companies like Akrivis, or Oxigen USA. [note: both companies are unaffiliated with Reinventure]
Finally, we picture companies which create value not only for their founders and investors, but for their stakeholders as well. This includes sharing the rewards of success with employees, of course. And it also includes making sure that the company benefits its customers, its partners, and the community where it operates.
Founders and companies with these attributes aren’t rare. There are many people and businesses with these characteristics hiding in plain sight. They are present all around us, but largely overlooked by mainstream investors. We believe they represent tremendous investment opportunities, and that working together with them we can create both financial and social value.
Rethinking Together
Now try the exercise again: imagine a successful entrepreneur.
Did you see anything different this time?
If this little exercise has inspired you to expand your concept of successful entrepreneurs, we invite you to take a look around to see who is hiding in plain sight in your networks, in your community. And we invite you to share your observations with us. We can’t wait to hear who and what you discover.
Or if you are a founder, and you feel this post could have been written about you, we invite you to tell us what you’re up to, and who else is in your network, in your community. We’re eager to cultivate a larger, higher-value community together.
At Reinventure Capital we’re reinventing investing. Please join us.