Founder Coko Eason
Updated 21 Dec 2018: Coko Eason's Milk the Moment has been inducted into the 2019 cohort of Velocity Accelerator in Birmingham, she told VNC today. BBJ coverage. -Ed.
COURTNEY 'Coko' Eason, the Black woman who is founder and CEO of Nashville-based startup Milk the Moment, is slated to participate in presentations before investors gathered this week in Boston.
Eason's presentation is tomorrow during the New England Venture Summit, which is run by YoungStartup.com.
Perhaps more significant for those who hope to retain Nashville startups, 35-year-old Eason told Venture Nashville she is considering pursuing a slot in accelerators in Birmingham, Ala., and-or in such cities as Pittsburgh, Los Angeles and Detroit.
The Memphis native who relocated to Nashville 13 years ago told VNC a few days ago that she believes she'll be enrolled in an accelerator program outside Tennessee by year's-end.
Meanwhile, Nashville's LeShane Greenhill -- a Black man who is both a former Google for Entrepreneurs and CODE2040 entrepreneur in residence, an advisor to the Nashville Business Incubation Center (NBIC) and founder-owner of SalesCocktail and Sagents -- is scheduled to spend a day later this month in Birmingham, scouting accelerators and other programs offered in the Magic City.
Greenhill told VNC that while he has no plans to leave Music City, he was intrigued by what he heard from a Birmingham booster he met a month ago, while attending an executive education program through Dartmouth University' minority business program (MBP) at the Tuck Business School.
Notably, Black mother-daughter co-founders of Mixtroz -- Kerry Schrader and Ashlee Ammons -- now consider Birmingham to be the de facto headquarters for the startup they originally launched in Franklin, just outside Nashville.
The women recently announced hitting the $1MM mark in raising Seed capital for Mixtroz -- a feat they credited partly to the support of Birmingham's Velocity Accelerator (an Innovation Depot program) and Bronze Valley, a Birmingham nonprofit dedicated to fostering diversity and inclusion, transformative business growth, capital access and innovation within Alabama's ecosystem.
Since planting their flag in Alabama, the Mixtroz duo also won a $100K #RiseOfTheRest investment via the Steve Case-led Revolution VC.
It was on the heels of this summer's high-energy SLOSS Tech event in Birmingham, that news platform AL.com reported that Mixtroz Co-founder Ashlee Ammons told their reporter, in part, "I will say this until I'm blue in the face, it took us in Nashville a year-and-a-half to make the same progress it took us 13 weeks to make in Birmingham."
In the same article, Ammons reportedly added that she believes that in some other cities "you have a lot of different entrepreneurial systems stepping on each other," she said. "You go where people feel you. Don't stay where people are telling you you're nuts. Go where people feel you. It's here."
|Co-founders Ammons & Schrader
Interviewed last week for this story, Schrader and Ammons said that in contrast to Birmingham, in Nashville an entrepreneur faces an inordinately high risk of failure to recruit capital if the entrepreneur is Black, a woman, a non-technologist founder, and they are pursuing a business that is not in the healthcare or medical sectors that seem to dominate the Nashville market.
Schrader, who several years ago retired from her career as a senior corporate HR executive (with Noranda Aluminum, Ford Motor, et al), told VNC that the Nashville portion of her journey with Mixtroz was extremely difficult, despite the fact that she and her daughter are empowered, well-educated, articulate and diligent women, advancing a thoroughly vetted business model with "an awesome product that fills a void."
They are also, Schrader added, women who at the outset of their venture were able to raise $200K in friends and family funding and who have never lived life as "disenfranchised" persons in their communities, and are fully aware of opportunities and goals they are free to pursue. Schrader said she and her daughter are not "victims" of gender and color, nor do they ask for "special treatment" for her company.
At the same time, Schrader said she must "clearly state that our experience has shown us that the rules are not the same for all players given the same circumstances, i.e., market-fit, traction, client acquisition, team makeup, etc."
Asked to elaborate, she said, in part, "What I can say [is that] given all of the press, studies, task forces that have been assembled and have acknowledged the disparities, enough is not being done to hold companies, organizations and investors accountable to make sustainable change. The numbers don't lie. My frustration is that 'real' action has not yet equaled all of the rhetoric" about reducing disparities.
LeShane Greenhill said he is not currently seeking capital, and his SAGENTS tech company has been cashflow positive for some time. However, he said that his earlier attempt to raise money "was not pleasant," even though his years of work and engagement in Nashville had enabled him to build bridges to a good share of potential investors and advisors.
With regard to raising capital, Greenhill recalled that "my meetings were cordial" and, of course, some VCs were more open than others to exploring possible transactions.
"But, sometimes," he added, "I did leave the room thinking, based on certain questions that were asked" that there was "some type of implicit bias toward entrepreneurs of color when it comes to raising money."
He said his uneasiness often flowed from confronting questions and patterns of questions that he felt would not have been asked of caucasian entrepreneurs.
Greenhill made clear that he believes that, overall, entrepreneurs of color have "just as good entrepreneurial ideas and ambitions as our [White] counterparts."
Yet, he said, he perceives that a substantial number of White investors would rather invest in a White entrepreneur with, say, "a social media app" that's popping-up in market replete with competitors, than invest in a minority-owned tech company that has gained major corporate customers within 90 days of launching, with no direct competitors on the radar.
One successful White Nashville businessperson of very long standing told VNC they had witnessed a highly credible minority entrepreneur pitching White investors, but failing to win support.
On condition of anonymity, the White businessperson told VNC they were disappointed on that occasion with the other potential investors, "who were very interested in the product and go-to-market strategy, but balked because of the minority management. Yes, everyone invests in both the management and their product, but [the startup's leaders] do not have to look like us."
Coko Eason says she is frequently asked by her acquaintances whether in Nashville and the region "Black people or Black and Brown founders are still experiencing just outright racism."
"For me personally," she said, "some experiences might be racism," but more often she senses that investors simply "want to stick with that cookie cutter that's always worked for them."
Illustrating her point, she said if we're judging a basketball dunking contest and we can choose between "a tall athletic Black man" and a "White nerdy guy" that we've never seen win a dunking contest, "I'm going to put my money where I've always seen this type person succeed."
She continued, "It's not that I have anything against [the nerd], it's just that I've never seen it work... I believe that's often what happens when you see minorities or women walking into" venture projects -- traditional investors are likely to be "more comfortable with the young White guy from MIT who can raise $300,000 from mom and dad. So, they're going to stick to what they've always seen."
Eason noted that while she doesn't see many minority women entrepreneurs among the leadership team of the Nashville Entrepreneur Center, the EC is continually taking steps to address diversity and inclusion issues.
The EC's diversity and inclusion initiative's advisory board members include both Eason and Greenhill. Another source today told VNC that EC CEO Michael Brody-Waite has been quite focused on the program in the past year, attending its quarterly meetings, and insisting on mapping paths toward substantive systemic efforts to improve diversity and inclusion, rather than on "quick wins" of little lasting consequence.
|EC's Brynn Plummer
Eason said she recently discussed potential new EC strategies for minority inclusion with the EC's recently hired VP for Inclusion and Community Relations, Brynn Plummer. Plummer joined the EC in September, succeeding Kelli Nowers.
Plummer told VNC that in early 2019 the EC is likely to announce some additional steps it's taking to increase minority enrollment in some program offerings and to address capital-access issues.
Eason said that when it comes to expanding participation of minority entrepreneurs, the EC must be sure not to adopt the "if we build it, they will come" mindset.
Instead, in her view the EC must establish ties and participate in minority students' meetings on campuses, and in fraternities and sororities of historically Black colleges and universities (HBCU) in the area -- particularly Fisk University and Tennessee State University -- which can be valuable sources for entrepreneurial and tech talent.
Student input on program priorities and designs is crucial, she said. VNC notes that Fisk is one of the HBCU universities that has been involved in the annual HBCU Innovation Summit, the latest of which was held in Silicon Valley this past October.
Eason also suggested that the EC could consider designing an "office hours" program in which minority entrepreneurs or other volunteer executives would work from the EC periodically, allowing minority startup leaders to "talk with somebody 'who looks like you'."
Eason also explained that while it is often possible for minority entrepreneurs to have good conversations with Angel investors, getting connected and generating traction with VCs is exceedingly difficult.
She said she has observed that minority-owned companies that fare better with VCs are those who are addressing a painpoint or unmet need in a well defined synergistic niche, providing a solution that attracts genuinely strategic investment.
So, helping minority firms sharpen their focus and their value proposition could pay dividends. Eason added that she recently met a potential investor who recently relocated to Nashville from another major city, and potential synergies may yet lead to a deal.
Eason also said Nashville should consider emulating other cities that want a strong startup community and which go "the extra mile" to encourage startups to take up residence, often by leveraging incentive packages that might include paid office space or other benefits.
She said she suspects Nashville organizations can learn to team more often with Google, Amazon and other companies that now have a Nashville presence, to open up doors to customers, help connect them with investors and other forms of support.
Meanwhile, Eason said she's pursuing exposure and opportunities beyond Nashville, as well as within Nashville.
She said that if she gets offers of the support she needs from investors and technologists in other cities, then Nashville may lose another startup, and if that becomes a frequent outcome, Nashville may never become the tech center it could be.
Darrell Freeman, the founder and now chairman of Zycron, control of which he sold to BG Staffing 18 months ago for about $20MM, said that while Nashville is inevitably not "perfect," it is in his estimation a good and "welcoming" city.
A Chattanooga native who launched his business in Nashville in 1991, Freeman said he is "110 percent in agreement" that dealing with biases is a common challenge for minority entrepreneurs focused on creating, growing and funding a business.
Indeed, it is "understood" that Black entrepreneurs face biases and are typically not "playing on a level playing field...but, it's winnable," said Freeman.
He acknowledged, for example, that over the years he sometimes found that a White executive decision-maker seemed to prefer dealing with a White member of Zycron's management team than with the founder, himself.
However, he said, "When I came to Nashville there were people who invested time and resources in Darrell Freeman, and many of them were Caucasian. I feel that the success I've had in Nashville couldn't have been done anywhere else."
"I have found people in Nashville who, if you find an idea they can make money on, they'll invest in it. Green is green," he added.
Nonetheless, said Freeman, if a minority entrepreneur can't find anybody in Nashville interested in their business, then it's "awesome!" for strong entrepreneurs to look to other cities where people do have both interest and risk capital.
In the case of Mixtroz, said Freeman, co-founders Schrader and Ammons are "extremely sharp and very passionate about their product. They are going to win -- anywhere they go, they are going to win."
Freeman said that in business day-to-day, he's "always felt the best way to overcome biases and racism is through having an excellent product or service."
Moreover, Freeman said there are encouraging signs of further progress, such as increasing readiness among many to engage constructively in eliminating or mitigating remaining barriers to access to opportunities.
For example, Freeman -- who will join the board of the Nashville EC in January, and who has over the years served as chairman of the Nashville Area Chamber of Commerce and other organizations -- said that supporting minority entrepreneurs not only remains a priority, but is among important criteria factored into the EC team's performance ratings.
In fact, one of the EC's "major drives," right now, is drawing more minorities into the funnel of EC entrepreneurial cohorts and other programs.
Freeman currently holds equity stakes in four local entrepreneurial companies, and he said he personally knows of a number minority-owned companies that have received investments from value-oriented White investors. He also knows of situations in which eager White investors have sought participation, but found the minority-owned company's offering fully subscribed and the owners resistant to further dilution of their equity.
Freeman also cited encouragement arising from the Mayor David Briley and Metro Council's recent agreement to implement measures to ensure equitable access to Metro Government purchasing contracts by minority- and women-owned businesses.
He noted that the Nashville Area Chamber of Commerce, of which he is a board member, is supporting that new contracting initiative, "simply because it's the right thing to do."
|Brio's Marcus Whitney
Marcus Whitney is a founding principal of healthcare-only Briovation, HealthFurther and Jumpstart Foundry initiatives, one of the leaders in recruiting professional soccer franchises to Nashville, and a former member of the founding team of Emma (now Campaign Monitor).
Asked for his views on these matters, he first noted that the problems of disparity of funding and opportunity among women- and minority-owned businesses have been extensively documented locally and nationally, and are incontrovertible.
Fortunately, he said, there is in Nashville growing recognition that we all have a socioeconomic stake in improving the situation. Whitney said the importance publicly assigned to diversity and inclusion by many segments of the community, including corporate citizens -- and avowed future corporate citizens, such as Amazon -- has helped drill home that point.
However, Whitney told VNC he believes there remains considerable uncertainty regarding the level of priority the city and power-wielding civic leaders actually assign to the issue, and what further actions they will take, going forward.
Whitney, who came to Nashville 18 years ago from the Boston area, said that, partly because he is very action-oriented, he takes real encouragement from Metro's recent steps toward encouraging minority and small-business contracting with city government.
Close monitoring of disparities must be continued, to avert backsliding in which the Metro dollars flow excessively into the "existing power structure," which he described as "overall, White." Leadership and action will be the overriding factor determining the lasting benefits of such efforts, he said.
Though it might take two decades or more, Whitney said that in the entrepreneurial technology sector, the key probably lies in developing larger numbers of talented Black technologists who work in more tech businesses or start more businesses, and then educating them on how to become Angel investors, said Whitney.
If all that happens, then two decades from now there would probably be hundreds of minorities who are at least "moderately or reasonably well off," some of whom might create a fund devoted to "investing in people of color."
Whether explicitly or implicitly, all interviewees for this story showed appreciation for expanding the numbers of minorities at the "top of the funnels" for each of their programs or proposals.
VNC also reached out for comment from Bob Crutchfield, the former head of Innovation Depot and former VC with Birmingham-based Harbert Management, who is now managing director of Atlanta-based BrightEdge Ventures, a $100 million fund investing alongside life science venture firms and others in cancer-focused therapies, medical devices, technologies and services. Bright Edge is an initiative of the American Cancer Society.
Crutchfield, a White Alabaman born in a small town roughly equidistant from Auburn and from LaGrange and Columbus, Ga., displayed obvious pride last week when he told VNC, "I think what Birmingham's doing is remarkable."
Said Crutchfield, "No one can deny that in the South [as well as in many other markets] it is more difficult for women and minorities to get funded."
"I do think that in the last three, four, five years Birmingham has become more and more intentional about fostering and supporting" entrepreneurial women and minorities, added Crutchfield, who then reeled-off a list of individuals and organizations in addition to the Depot that have helped drive that, from Miller Girvin of Alabama Capital Network to folks with Alabama Power, University of Alabama at Birmingham and Birmingham Business Alliance, to name but a few.
Crutchfield said that as a matter both practical and strategic, one of the most important strategies used within the Velocity Accelerator of Innovation Depot has been deciding to "work hard to get high enough volume" of accelerator applicants overall to ensure that the portion minority and women teams is big enough to ensure they win a commensurate share of accelerator seats.
Editor's note: Some earlier VNC diversity coverage is here. And, here are some of a myriad of articles and studies readily available online regarding women and minorities' particular challenges in recruiting capital: Forbes + Fast Company + MBDA. VNC
. last edited 0819 CT 12 Dec 2018