When Joanna Smith-Griffin was working as a student engagement director at Excel Academy Charter Schools in Boston, she discovered there needed to be a more streamlined process for curbing chronic absenteeism in her school. And soon she learned this was not an isolated issue — but one that allows the achievement gap to persist in K-12 schools. The solution: an app that would identify children at risk of chronic absenteeism.
Today, Smith-Griffin is the founder of AllHere, an edtech company that uses mobile messaging powered by artificial intelligence to curtail chronic absenteeism. AllHere has received an $8 million Series A round by Spero Ventures. In addition, investors such as Rethink Education, Gratitude Railroad, Potencia Ventures, Boston Impact Initiative, and others have allowed AllHere to not only launch, but also position itself for growth.
AllHere serves K-12 schools by using evidence-based intervention strategies to support school districts in developing family outreach strategies and monitoring student attendance. More than 8,000 schools in 34 states are currently using AllHere to curb chronic absenteeism, allowing school districts to reach 2 million students and their families.
Yet Smith-Griffin’s journey from idea to full-fledged business was not without obstacles. Her initial investment in AllHere of $5,000 dwindled quickly and Griffin-Smith realized she needed the guidance of other startup entrepreneurs as AllHere needed to meet the needs of school administrators.
Smith-Griffin’s needs as a Black startup founder illuminates a problem that many others have faced: mentorship that will support the development of their product and access to capital. In 2021, Black founders raised an estimated $2 billion in funding. While that is a large number, when compared to the $147 billion startups received in funding, it is a mere drop in the bucket. In addition, according to Crunchbase, Black women startup founders received .34 percent of all venture capital-funded in the United States.
Lamont Young, head of digital and customer experience at Citizens acknowledges the challenges that Black founders often face — and notes the role unconscious bias plays in hindering Black founders.
“I’ve spent enough time in Silicon Valley to see how many Black and Brown founders aren’t given the same opportunities and resources,” Young told CNBC. “Just by helping people get to that first seat, we can help build an infrastructure that opens doors to tons of different boards and investors looking to get a return on their capital.”
Despite the struggles associated with being a founder, Smith-Griffin chose to focus on several practices early on to pique the interest of her investors and believes there are several strategies that Black founders must embrace to acquire the funding necessary to launch, grow and sustain their businesses. Here is some insight that Smith-Griffin recently shared with Finurah concerning mentorship and access to capital.
Understand Your Business, Build Your Team
Before approaching a VC, a founder should always understand their purpose.
“Remember your “why.” Most people get into entrepreneurship because they have a problem they want to solve, a vision for how the world can become better, or an innovation that just can’t be ignored,’ Smith-Griffin said.
Once a founder understands their purpose, they should focus on identifying their ideal venture capitalist firms. For a founder to invest in a company, there needs to be a synergy as this will be a working relationship that will impact business growth and development.
“Build a business case that clients and, by extension, investors can’t ignore,” she said. “Always seek to grow the best business that you can. Focusing on your company’s fundamentals will attract the right partners to get your business further, faster.”
Mentorships Are Necessary Building Blocks
Access to mentorship plays a critical role in closing the venture capital gap for entrepreneurs of color. According to workplace mentorship hub, Guider, 67 percent of businesses experienced an
increase in their productivity as a result of working with a mentor. In addition, 55 percent believe that mentoring has had a positive impact on their company profits.
In the early days of All Here, Smith-Griffin participated in Harvard Innovation Lab’s Venture Incubation Program and the AT&T Aspire Program. The outcome: an introduction to Rethink Education, a VC dedicated to investing in edtech startups. The VC invested $250,000 into All Here for two consecutive years before introducing Smith-Griffin to another VC, which invested $100,000.
“Build a team around you of mentors and advisers, that may include operators from other businesses in a similar stage of yours,” Smith-Griffin said. “That community of support helps to not only grow the business, but to also weather the challenges of growing a venture-backed company.”
Gain Access To Capital But Don’t Rule Out Other Funding Options
It’s no secret that white startup founders hit the ground running with funding before they even begin seeking venture capital investments. White men possess 90 percent more wealth than Black women, according to Goldman Sachs Research and are able to acquire funding from family and friends. In addition, the ProjectDiane 2021 Update finds that Black and Latino women founders raised $953 million in venture capital in the first quarter of 2021 – 1.5 percent of all venture capital raised.
However, Smith-Griffin argues that Black startup founders should not focus solely on venture capital funding.
“Consider venture capital as only one way to fund a business,” she said. There are many successful businesses that are bootstrapped or take advantage of government grants and other sources of capital. Funding your business is not “VC” or bust.”
In addition, Smith-Griffin encourages founders to tell the story of their company and its growth. This will support attracting the right venture capitalists for their company.
“Pay attention to the fundamentals of your business. What is your traction like? What impact do you create? What about total addressable market opportunity? Customer and client growth and satisfaction, renewal and expansion?” she says. “Being able to tell an authentic narrative about your company’s growth will be great for connecting with the right VCs for your company.”
