StartupEquity: Shani Dowell on lessons honed during Possip's rise
By Milt Capps
CEO SHANI DOWELL, the black female edtech entrepreneur who founded Possip in Nashville, is naturally proud of having become one of the few black women in the U.S. to have recruited $1MM or more funding for a startup.
She embraces the historic nature of having now passed that capital milestone, with her outside raises totaling $1.02MM, 98% of which was raised using a convertible note.
Despite some gains in U.S. participation of black women in scalable startups, Dowell is still likely to stand out when she participates this spring as a member of "Elite 200" education and workforce tech entrepreneurs who are hoping to make the cut to be among three finalists competing for the Global Silicon Valley (GSV) Cup, April 1 in San Diego.
INC. Magazine reported in October that the number of black women nationwide who have recruited that much capital is "fewer than 50" people -- and even that number represents a one-third increase in the past couple years.
Also sobering is the fact that another group -- DigitalUndivided -- says their researchers have identified only six (6) black women startup founders in Tennessee (mouseover state on map). More VNC coverage of inclusion and equity here.
Possip was conceived in 2016, raised no outside money in 2017, then in 2018 executed $200K in convertible transactions, while pursuing a bootstrapping strategy.
That was followed in 2019 by a total $210K from three Launch Tennessee sources ($150K from the Impact Fund, $50K via the 36|86 Festival pitch win, and $10K via 36|86 competitive voting ahead of the Festival).
Most of the rest of the $1MM+ tally came on the wings of eight Angel investors who took advantage of the convertible offering, said Dowell, who added that the Possip founder had invested about $80K.
Possip earns revenue from schools and-or school districts for the Possip package of email- or text-message content and transmission, an actionable summary of parental responses to queries, plus trend reports and insights that are drawn locally and-or derived from the company's expanding network of participating schools, which currently touches 16 states.
The CEO grew up in Houston and arrived Nashville 11 years ago. Here, she rose to Nashville director for Teach for America. In addition to roughly 14 years in classrooms and with education nonprofits, she had early experience with consulting firms, including Bain & Co. (Boston). She holds an MBA from Stanford University and a bachelor's in business from Howard University (her LinkedIn).
The company now has 7 FTE staff in Nashville, Chicago and Cincinnati, with plans to add some part-timers early this year. Possip full-timers include four persons in based in Nashville, two in Chicago and one in Cincinnati. It has part-time workers in Colorado, Florida and North Carolina.
In addition to the CEO, the team includes Operations Director Christine Fisher, tech lead Adam Thede, Hannah Hall and Michael Dyer in sales and partnerships, Caitlin Churchill for product management, and Amanda Richards as consultant practice partner.
When asked what spells "success," the CEO emphasized that, particularly for entrepreneurs of color, the journey requires more than vision, a vetted product and business model, and personal grit. Those are givens.
The task also requires that all entrepreneurs develop the resilience and ability to withstand non-responsiveness or outright rejection by investors, generally, and to learn from both encouraging and disappointing encounters -- particularly when racial discrimination may be influencing the process.
"What's hard [about deciding how you'll respond to discrimination] is that you have to be both aware of it and know it, but not get too anchored in it, because it becomes too heavy," said the Houston native.
Particularly when discrimination is "super subtle," Dowell said she's found that it's very important to "see what you can learn" from each situation.
The commitment to learning from each encounter with investors is also important, she said.
"I've been really fortunate that my investors are people who have the best interest of the company in mind," said Dowell.
"Sometimes people raising money get demoralized by the process," particularly when dealing with an investor whose terms and timelines signal poor alignment between their financial goals and what the entrepreneur thinks is best for the startup company.
Aggressive investors are typically very open about their financial priorities, and their interest in a satisfactory return on their investment is legitimate and important.
Still, entrepreneurs should not automatically ignore their instincts. "There are sharks out there," she added.
Dowell noted that startups are often striving to address problems and pain-points in industries, markets and communities that wealthy investors have not experienced firsthand, so "a lot of the time they have trouble wrapping their minds around" the startup's solution.
One of the most important means of maturing both a business and its owner's view of the road ahead is by "reaching out to people who believe in you and trust your vision for the company."
Dowell said that she strongly urges people of color "to not be shy about broadening their networks, about thinking broadly about our networks," and demonstrating well-founded "conviction and belief in what you're doing and why you're doing it."
With a "learning" mindset, she said again, all entrepreneurs can get more comfortable with the risk of rejection, and not let it derail learning and the pursuit of wisdom.
In short, she said, entrepreneurs -- particularly entrepreneurs of color -- are well advised to "be prepared for every single interaction with folks."
She then cautioned, "Be protective of your time. It's good to 'talk', but watch your time expenditures."
Asked to update us on the company's advisors, Dowell said the company's lawyers are now mainly with Taft Stettinius & Hollister in Cincinnati, its accounting is with Rudler (Cincinnati) and its banking is now with JP Morgan (Cincinnati).
The founder and husband Randy Dowell, who is executive director of the KIPP Nashville charter school, live in East Nashville with their two school-age children.
For fuller background on Dowell's experience, Possip's journey, and notes on previous advisors, competitors and more, please see VNC's indepth 2018 story here. VNC
. last edited 1516 7 January 2020