đMotivation Meowsđ
Hello, and welcome to yet another edition of The Black Cat.
As always, here is some Good Black News.
Harlem Capital is set to receive an investment of âup to $4 millionâ from the New York City Catalyst Fund, a $40 million fund that backs firms focused on diverse entrepreneurship, emerging sectors, and community development. Ovom Care just raised $5.2 million to continue innovating fertility tech. Slutty Vegan CEO Pink Cole served as the commencement speaker at Savannah State University, where she also gave each graduate a starter pack to help them start their own businesses. The gifts total $8.75 million.
Also, I published my first big investigation; I would love it if you all checked it out here: âInside the âcold warâ at Techstars as CEO MaĂŤlle Gavet hires, fires, fights to force changeâ
đ˘From the Chatterboxđ˘
This week, I am chatting with Randolph Wiggins, also known as Randy. Heâs a founder, investor, and ecosystem builder who works at the intersection of policy, impact, and innovation. Heâs also a contributor to The White Houseâs recent $10 billion Tech Hubs Initiative, which seeks to boost investments throughout the country. The son of a social care worker, Wiggins hails from New Jersey, attended Princeton University on a scholarship from Bill Gates, and worked in the Obama Administration as a member of the National Economic Council.
He became interested in venture capital in the early 2000s when he was selected to become one of the first Gates Millennium Scholars, a billion-dollar effort founded by Bill Gates and Melinda French through their foundation. The scholarship sought to increase diverse representation in STEM. He was able to dive deeper into the world of VC by taking an internship in 2001 at a fund responsible for investing in Princtonâs Endowment, which was then hovering around $8.5 billion. From there, he continued his work in the field and even moved to the Bay Area to continue working in investments, working for places such as Omidyar Network and BLCK VC.
Wigginsâ goal in this space is to increase access to high-growth technology for all Americans, believing it will help boost the economy, protect the nationâs geopolitical interests, and make good on the promise of the American Dream.
âWhat drives me every day is a deep desire to make manifest the belief that in America, anything is possible,â he told me, adding that he hopes that âall aspiring tech entrepreneurs â regardless of background â will have the exposure, education, training, opportunity, guidance, and support needed to build technology companies that will not only change their lives, families, and communities but also change the world.â
Here is my Q&A with Randolph Wiggins. (This interview has been slightly edited and condensed for clarity.)
The Black Cat: You sent a memo to the Biden Administration outlining ways you would like to see the U.S. Government support emerging tech hubs, specifically Tulsa and Black Wall Street. Can you talk a bit more about this memo and whether the government addressed it?
Randolph Wiggins: I recognized early the role that the Federal government played in the formation of Silicon Valley and the role that the public sector could play today in supporting the formation of new technology and innovation ecosystems across America.
With this understanding, I reached out to former Princeton professor, former Dean of Princetonâs School of Public and International Affairs, and then Council of Economic Advisors Chair Cecilia Rouse to explore garnering support from the Biden Administration. Chair Rouse and members of her Council of Economic Advisors team generously shared their time and insights with me and urged me to draft a policy memorandum on ways that the Administration could assist in Americaâs tech ecosystem-building work. I conducted extensive research on the formation of Americaâs, and ultimately the worldâs, home of technology innovation â Silicon Valley.
I was able to gain an understanding of the key factors that contributed to the building of the worldâs most powerful innovation center. Factors like government funding top tier academic and engineering programs and faculty, a strong venture funding community, and ties to local, national, and international corporate partners. Synthesizing this information â along with a review of current governmental departments, policies, and funding sources â and making the argument for both Americaâs global economic security and domestic job creation, I proposed that the Biden Administration support the creation of technology ecosystems in Middle America and across the country.
I am proud to say that the memo was passed on to the Economic Development Administration (EDA) and two years later contributed to the formation of the EDAâs Tech Hubs Initiative â a $10 billion 5-year initiative that aims to strengthen U.S. economic and national security with investments in 31 regions across the country. This initiative provides assets and resources to regions across America that have the potential to become globally competitive in the technologies and industries of the future. As the Tech Hubs webpage notes, this initiative not only seeks to build new industries and companies but also good jobs that will be started, grown, and remain in the United States.
TBC: In the memo, you discussed the importance of policy in creating economic equality. But with a government as divided as ours, how difficult would it be to pass and implement some of those policies you mentioned?
Wiggins: Even with a government as currently divided as ours, there is a strong historical precedent for bipartisan support of transformative economic policies, with numerous examples of collaboration across party lines to address economic challenges and promote economic opportunity and growth. The Social Security Act of 1935; the Great Society Programs of the 1960s; the Economic Stimulus Acts of 2008 and 2009; and most recently, the Trump Administrationâs CARES Act of 2020 and the Biden Administrationâs American Rescue Plan of 2021 demonstrate Americaâs uncanny ability to achieve bipartisan support when responding to our nationâs greatest economic challenges.
While currently unprecedented technological shifts, spearheaded by the recent growth of artificial intelligence, provide our nation with unprecedented economic opportunity, if not managed properly by our nationâs governments and corporations, these same technological shifts also risk creating unprecedented economic challenges. Because of this, I believe that all government leaders â at the Federal, state, and local levels â clearly see the dual potential of this technological change. They, like their predecessors, will come together to meet the moment and put country before party and opportunity before obstinance to enact policies that will foster the broadest possible economic growth, ensuring that Americans in every city, town, state, and regionâ of every party, every color, every background and in every corner of our nation â have the opportunity to thrive. I am not only proud to see many of the policy recommendations made already being implemented through the Tech Hubs Program â in 31 regions covering both red states and blue states across America â but am confident in all of the future bipartisan opportunity-maximizing policies to come.
TBC: Why does it feel like progress for venture equity is at a standstill? Investors donâtâand arenâtâgiving much money to Black founders anymore. At the same time, due to the generational wealth gap, there isnât the same level of money that can circulate to make the community self-sustaining. Where are we now when it comes to progress in this space, and what needs to happen now to continue the fight for venture equity?
Wiggins: For Black founders, funding is not at a standstill. It has actually reversed. According to Crunchbase, venture funding to Black-founded U.S. startups in 2023 totaled $705 million â dropping from $4.9 billion in 2021 and making it the first time since 2016 that Black startups failed to raise $1 billion. While one can point to an overall decline in venture funding from its post-pandemic highs, the decline in capital to Black-founded startups greatly outpaced the overall decline in startup funding as total venture dollars in the U.S. fell 37% between 2022 and 2023, while funding to Black-founded startups dropped 71% over the same period, according to Crunchbase data.
There is some progress being made at the governmental, venture and corporate levels. For example, just two months ago, the U.S. Department of the Treasuryâs State Small Business Credit Initiative announced that it is seeking to work with more states and territories to provide funding for underserved, small, and diverse managed investment firms â resulting in the democratization of venture capital in underserved communities across the country. Venture capital investment firm programs like Slauson & Coâs Friends and Family accelerator and accelerator programs like Rising Stars from Techstars are providing funding and support to diverse entrepreneurs in their earliest stages of building. Corporate programs like Googleâs Black Founders Fund, which provides equity-free cash awards and hands-on support, are also supporting Black founders to build and grow their businesses. When it comes to continuing the fight for venture equity, I believe that we must not only grow current programs but also explore the creation of both new programs and collaborations that will serve Black and diverse entrepreneurs in our country at scale.
If you look at Silicon Valleyâs venture ecosystem, youâll see a strong and interconnected network of funders and funding sources working in concert to maximize opportunities for talented founders. I believe that seeing this challenge as an engineering issue and fiercely pursuing innovation to build a similarly structured system should be our North Star.
TBC: How is policy currently underused as a way to create more financial equity?
Wiggins: When we think of policyâs role in creating equity in venture, we often think of funding, however, I believe that there remains an opportunity for policy to take a more holistic, systemic, and structural look at the entire lifecycle of a successful tech founder and startup and determine which factors have historically served as the key drivers for success â factors like exposure, education, training, funding, networks, distribution channels and corporate partners, clients, and customers. With this information, I would encourage policymakers to reverse engineer their learnings to specific sets of policies that would support entrepreneurs, providing not just funding but support along the founder's journey. Such policies would be catalytic as they would help to increase the number of economic winners who themselves would become investors â helping to close wealth and funding gaps and create a flywheel of positive commercial success, financial equity, and economic impact.
TBC: Something Iâve always wondered is if racist policies are what disenfranchised people; what other way is there to rectify the past other than anti-discrimination policies like those Edward Blum has started to take charge against?
Wiggins: Policymakers can pursue policies that are not race-based but instead focus on other characteristics like economic status or access to resources. This type of focus would both positively impact broader numbers of Americans and help achieve the goal of remedying historical wrongs that have resulted in negative economic outcomes for diverse groups of Americans.
TBC: Speaking of Blum, there are many groups like him that have taken to suing everything from the Small Business Agency to the Minority Development Business Agency, for what they say is discriminating against white men. What can we even think of doing next to address or circumvent these suits as they keep coming and winning?
Wiggins: I subscribe to the thinking of corporate leaders like JPMorgan Chase CEO Jamie Dimon, a recently self-described âfull-throated, red-blooded, patriotic, unwoke, capitalist CEOâ who sees diversity as good for business as reaching more communities means growing the customer base; is not retreating from diversity efforts; and has committed his firm to continuing its plans to reach out to marginalized communities. I believe that we can all take a page from Mr. Dimon and JPMorganâs leadership in this area and push forward with policies, programs, and efforts by modifying programs and processes to move away from factors like race to factors like socio-economic status â thus remaining compliant with the law while still maximizing positive impact for diverse communities and ultimately growing our economic base.
TBC: How can policy be used to fix the educational pipeline that could lead to more STEM talent and, as a result, more Black representation within the tech sector?
Wiggins: Hereâs a little-known fact: in America, we can tell if a child has the potential to be a great tech entrepreneur as early as 4th grade based on their math and science scores. Because we know this, policy can be used to fix the STEM pipeline by working with educational systems to help students, who are identified to have this potential, and their families in cities and towns across the country to receive the exposure, wrap-around services, and experiences needed for success as tech startup founders â the same exposure and experiences received by prolific tech founders like Bill Gates.
TBC: I must mention artificial intelligence. What can be done about the lack of attention Big AI companies are paying to the Black community when it comes to building this technology that is touted to disrupt the world?
Wiggins: According to the Dec 19, 2023 McKinsey report, The Impact of Generative AI on Black Communities, generative AI has the potential to widen the racial economic gap in the United States by $43 billion per year. Given the potential economic dangers presented by AI, I would recommend the convening of government, technology and business leaders to both determine and commit to the most thoughtful ways to implement AI to ensure that this danger does not materialize and that this technology is only used to maximize positive economic outcomes for all.
TBC: What is one thing you are looking forward to this year when it comes to the economic empowerment of the Black community?
Wiggins: The re-imagining of this issue as a national economic, technological, and business challenge and implementing all of the necessary thinking, strategies, tools, actions, alliances, and collaborations required to solve it.