If I Broke Into VC, Anyone Can. Here’s How.

By Melissa Allen. Learn more about Melissa Allen in The Globe and Mail.

There are not that many women in Venture Capital, and even less people of colour. It’s particularly stark here in Canada, and what’s worse, we don’t have a strong set of stats breaking down exactly which ethnic groups are represented in Canadian VC and which founders get funded. The good news is, venture capital is a learnable skillset, and is one of the few industries that leans heavily on having a wide variety of experiences to reflect the variety of businesses, markets, and opportunities that are out there. Yet surprisingly/unsurprisingly, most VCs seem to get into it through the same traditional pathways. However, it’s becoming increasingly common to come from “non-traditional” backgrounds before getting into VC (for example, I know a former ballerina that is now one of the top VCs in Canada).

Traditional Pathways to VC

1. Get your MBA
2. Transition from Investment Banking and/or Private Equity
3. Be an exited founder
4. Be wealthy and connected

Taking the Windy Road to a Career in VC (i.e. the “Non-Traditional” Path)

Build your private investment track record

If you’re an accredited investor, websites like AngelList are a great place to find angel deals and post them so that you showcase the portfolio you’re building as you build it. I’m starting to hear about prolific investors on this platform building huge angel syndicates with large AUMs (assets under management). However, if you’re new to investing and not an accredited investor (yet), equity crowd funding platforms like Equivesto is a great place to build your portfolio, plus, they have easy-to-understand dashboard where you can track all of your investments with them in one place.

Apply for Angel Investing/VC accelerators

I got my start by applying for and getting into the Female Funders Angel Academy program (after meeting one of the program heads via networking, more on that later), which has evolved into First Capital. It was quite the rigorous program and it provided me with a strong network that helped me with my first investment AND building my own fund from the ground up with my General Partners. American VC firms Susa Capital, Cleo Capital, BLCK, and Harlem Capital all have programs that train and coaches newbies on the practical aspects of how to angel invest.

Work at a startup accelerator/incubator

A great place to learn about what accelerators and incubators in the GTA and beyond are TorontoStarts and TechTO. There are some international ones with locations internationally, such as TechStars. Volunteering or working at one will give you hands on experience on what it takes for a founder to grow their business, make it investment-ready, and scale it.

Become a scout

Scouting programs don’t really exist in Canada, but I see can see them growing in popularity as Canada’s VC landscape matures. Scouts are people who seek out deal flow for VC firms and are compensated with a piece of ownership in that deal (“carry”). All you have to do is build your network in the startup scene. And then build relationships with VC firms (all of whom are always looking for relevant deal flow). Simple, right? 😊

Become an advisor

Use your knowledge, expertise and skill set to support founders as an advisor. You may even get compensated for it in terms of carry and/or an hourly rate, but it’s 10000% worth it to do it for free to build your coaching skills, your network, and to get experience. Plus, it’s extremely gratifying to help someone else using your gifts.

Some Tips

1. Network.

My team and I know that 25+% of our job is networking and building our personal “brands” by attending, and eventually speaking, at different events. Be polite to everyone…and that 21 year old who’s looking for a job or trying to get their startup off the ground? Get to know them! They could be the next unicorn founder. 😊

2. Leverage social media.

Never has there been a time where you can direct message influential people and have them possibly message you back like there is now! Leverage this. The VC/startup world LOVES Twitter, and I’ve had a lot of success with Instagram. LinkedIn is great must as well.

3. Be persistent.

Be relentless, it took me three years to break into VC full-time, and to be honest, I feel like it’s actually a pretty short amount of time, given my own “non-traditional” background.

4. Define and generously contribute your personal “value-add” wherever you are.

Rule of thumb: add true value to someone 10x over before asking anything in return. This can often take years but is worth it for when you REALLY need to call in a favour. Oh, and don’t ask people to coffee. Coffee meets are time consuming and draining. And, believe it or not, don’t ask them how you can help them. Finding things for people to do, especially when you don’t know them and their strengths, is also time-consuming. Simple ways to add value are to like, share, comment (positively) on their social media, buy and use their products if they’re founders, refer them potential clients/customers, or even just send them positive and encouraging DMs. We all have tough days, and I know that when I see a positive DM that says “Thank you for what you’re doing for the community” I’m reminded that the grind is worth it.

It’s an exciting time to be in VC—it’s growing industry-wise and in terms of diversity, which means that more diverse founders will get the financial resources they need, which means more products and services will come into the world that help more types of people. Simply put: diversity in venture capital means a better, more inclusive world for everyone.

Check out more of my writing:

Financial Advisor Melissa Allen Breaks Down RRSPs and TFSAs

If Toronto Wants to be a Global Tech Hub, it Needs to Nurture its Tech Talent

More articles about me:

Melissa Allen on Diversity in Corporate Canada | Toronto | Bay Mills | Capital M Ventures

Meet Melissa Allen, League of Innovators’ new Executive Director

League of Innovators Appoints Melissa Allen as New Executive Director

Melissa Allen of Bay Mills, and Capital M Joins LOI Venture as a Venture Partner

Melissa Allen lands Executive Director role at League of Innovators | Toronto

The Democratization of Private Investing

Disclaimer: These thoughts and opinions are my own and do NOT constitute financial advice. Please do your research and talk to a financial advisor (I know a few amazing ones).

By Melissa Allen. Learn more about Melissa Allen in The Globe and Mail.

In 2017, billionaire businessman and philanthropist Michael Lee Chin went on CBC’s Lang and O’Leary Exchange and said that “There is a total lack of access to good, solid, private opportunities. And at the end of the day, wealth is created in the private world. More so than in the public world.”

A “private company” means that it is owed privately, as it, it is not listed on any public stock exchange. Startups are always private, being financed by either the owners themselves, friends and families (and fools, some might say!), or high net worth investors. On the other hand, there are some private companies that are much more mature, their leadership team and/or board have decided not to seek capital through a public offering. Purchasing shares on a public stock exchange is generally considered to be less risky than investing in a private company because public companies are required to publicly report on their financials (seriously! Go on the website of your favourite publicly listed companies…you can usually find their financial statements under “Corporate” or “Investor Relations”) using standardized and audited accounting methods—typically either GAAP or, more recently, IFRS. Because a listed company’s financial information is publicly available, the government then deems that the average, every day investor has access to enough accurate information to reasonably decide whether or not to make an investment.

So why then, do people invest in private companies? Because, as with all things in life, where there is greater risk, there is greater reward. When you invest in startups you take on massive risk. As I’m sure I’ve mentioned before, 8 or 9 out of 10 startups you invest in will probably fail, so goes the widely-acknowledged venture capital math. If your investment strategy is done right, that 10^th startup will be a huge success and knock it out of the park, more than making up for those 9 losses.

I begun to figure out that adding private companies to an investment portfolio is a critical piece of the wealth-building puzzle. The rule of thumb for investors is that between 5 and 20% of your investment portfolio should focus on these high risk, speculative (aka “fun”) opportunities. I’m glad these discussions about private company investing are fully (and finally) going mainstream. Example: Arlan Hamilton’s Backstage Capital partnering with an American equity crowd funding platform, giving every day people in the States the opportunity make small investments into new private companies (i.e. start ups).

9 hours after launching, they raised $1 million, and after a week, they raised the max $5 million allowed for this type of investment, smashing records and making history. Clearly, we the people have been waiting for these kinds of opportunities to become available to us! And finally, they are, and this will just be the beginning.

Check out more of my writing:

Financial Advisor Melissa Allen Breaks Down RRSPs and TFSAs

If Toronto Wants to be a Global Tech Hub, it Needs to Nurture its Tech Talent

More articles about me:

Melissa Allen on Diversity in Corporate Canada

Meet Melissa Allen, League of Innovators’ new Executive Director

League of Innovators Appoints Melissa Allen as New Executive Director

Melissa Allen of Bay Mills, and Capital M Joins LOI Venture as a Venture Partner

Melissa Allen lands Executive Director role at League of Innovators | Toronto

Working at a Start Up: The Perfect Balance Between Entrepreneurship and Corporate.

By Melissa Allen

Sometimes, I look back on my twenties and wonder “what if” I became self-employed and an entrepreneur straight out of college/university. Perhaps I would have been farther along in my journey of start ups and venture capital. Or, perhaps not. It takes a certain maturity to rely 100% on yourself to make things happen and keep a roof over your head. And even then, for some of us lucky ones, that worry is taken away if we have certain safety nets we can rely on to get us through the emotional and financial rollercoaster that is entrepreneurship. Maybe I could have been the next Mark Zuckerburg, or at least, someone with a growing business doing what they love. On the other hand, my eight years in the corporate world was a HUGE privilege and bonus.

For a lot of young people I talk to who work traditional 9 to 5 jobs, and who are getting ansty/frustrated, and really feeling the drive to strike out on their own but don’t know what they want to do, I’m always quick to remind them that it’s perfectly okay to work a regular job and build your name, skill set, and bank account while you’re figuring that out. I’m forever grateful for all of my corporate jobs, for giving me the hard and soft skills, along with “polish” needed to carry myself in professional settings. I truly feel that my corporate experiences prepared me for the world of entrepreneurship, and how to navigate it.

Still not convinced? Then perhaps a happy medium between working for yourself and a larger corporation is the solution: working at a start up. Several of my friends have worked for start ups, and I’ve done a lot of freelance work for them too. Back in the days when we could go into the office, you could really feel that exciting buzz in the air—everyone was bright, energetic, optimistic, and passionate. Corporate politics and social hierarchies are not yet cemented at this point, so there’s just this more relaxed “be respectful, collaborative, and get results” type of attitude that contributes to that relaxed feeling. Working at start up means that you were hired for your education, practical experience, attitude, and ability to problem-solve on the fly and sometimes under tight deadlines. It means contributing to building something special that could impact hundreds, thousands, and even millions of people. It’s that sense of pride know that you are part of a talented community, who’s come together to make an impact. Not to mention how much faster you can climb the ladder and make a name for yourself in your industry.

So how do actually get a job at a start up? So many ways! There is the traditional job website/LinkedIn route, add to that following and interacting with local start up founders and innovators on social media, and look up the MANY (virtual, for now) start up and founder events via meetup.com and Eventbrite. Network, network, network! Hopefully in the coming months, I’ll get to talk to start up employees about their journey to working for one.

Getting to know the crew equity crowdfunding platform Equivesto, has certainly made me miss working in start up environments…and who knows? Maybe I’ll have a chance to one day soon. Stay tuned!

Check out more of my writing:

Financial Advisor Melissa Allen Breaks Down RRSPs and TFSAs

If Toronto Wants to be a Global Tech Hub, it Needs to Nurture its Tech Talent

More articles about me:

Melissa Allen on Diversity in Corporate Canada | Toronto | Bay Mills

Meet Melissa Allen, League of Innovators’ new Executive Director

League of Innovators Appoints Melissa Allen as New Executive Director

Melissa Allen of Bay Mills, and Capital M Joins LOI Venture as a Venture Partner

Melissa Allen lands Executive Director role at League of Innovators | Toronto

Don’t fit into the corporate world? Maybe you’re an entrepreneur.

By Melissa Allen. Learn about Melissa Allen in the Globe and Mail.

After a couple of false-starts, I landed my dream job as a marketing coordinator at a well-known brand. I was fresh out of school, and fresh out of a prestigious internship at the Paris office of Foreign Affairs Canada. I walked into the bright office building, filled with chic, accomplished women and thought “I have finally arrived, I give myself five years until I climb the ladder to the C-Suite.”

LOL no.

Over the next few years, to make a long story short, I left the company to take my career the next level. This would begin a 9-year cycle that went like this: Get a job, become the company star, get promoted (once), perform at a high level while absorbing more and more tasks and responsibilities, do something “awkward” (but non-job task related) that would draw the disproportionate (in my opinion!) ire of the upper management, then either dip once it became clear I would be constructively dismissed or get laid off*. Rinse repeat, rinse repeat.

Over that near-decade of career wins, and many career mishaps, and a LOT of learning along the way, I was offered the opportunity to work for myself and build my own business. Suddenly, despite all of my socially awkwardness and quirks, I became known as a star performer, raking up all the awards a rookie could win in my first couple of years. At some point, I connected the dots and realized that my lack of success in the corporate 9 to 5 (or should I saw 8 to 6) world was inversely correlated with my rapid success in an environment where the results spoke for themselves: entrepreneurship. As I connected with other entrepreneurs on this five year journey of working for myself, I realized that we are all a little goofy, a little quirky, and a LOT outside the box thinkers. They were also all very passionate about their businesses and very successful by all measures.

Now I tell young men and women who seem to be constantly hitting the wall in their career: whether it’s a constant stream bad boss, always falling out of love with their new job after a few months, or just constantly getting fired, maybe they should consider: it’s not them, it’s you.

When I say “it’s probably you” I actually mean that in a good way. Perhaps you just weren’t built to work with other people. Perhaps your unique perspectives, skills and interests are better served through a vision you create, through your values, and your mission here on earth. And maybe, all of those “false starts” and career-hopping are simply meant to teach you the wide variety of skills you need to start your own business in the first place.

In my 20s, when I was first starting out, entrepreneurship wasn’t as popular or widely accepted and even celebrated as it is now. Back then, there were no masterminds, #bossbabe hashtags, or Gary Vees teaching you how to #hustle and cheering you on. There were no companies like Equivesto, to help you raise capital through equity crowd funding. But now there is. So if you’re struggling along in your day job, start building out your business ideas now (not using company laptops and resources btw, because they claim ownership of the rights to your business, plus it’s not ethical) and see what sticks. Because perhaps there is actually nothing wrong with the job, your boss, or the company, you’re simply just an entrepreneur at heart. Own it!

Check out more of my writing:

Financial Advisor Melissa Allen Breaks Down RRSPs and TFSAs

If Toronto Wants to be a Global Tech Hub, it Needs to Nurture its Tech Talent

More articles about me:

Melissa Allen Diversity in Corporate Canada | Bay Mills | Capital M

Meet Melissa Allen, League of Innovators’ new Executive Director

League of Innovators Appoints Melissa Allen as New Executive Director

Melissa Allen of Bay Mills, and Capital M Joins LOI Venture as a Venture Partner

Melissa Allen lands Executive Director role at League of Innovators | Toronto

The Brutal Stats Around Women in Tech/VC Actually Present an Opportunity

By Melissa Allen. Read about Melissa Allen in Globe and Mail.

Well, it’s definitely an exciting time to be Black, a person of colour, and/or a woman in tech, entrepreneurship and VC! In the past two years, but specifically this year, 2020, it seems I can’t go a week without hearing about a newly funded company or VC firm with underrepresented (and underestimated!) founders. While this is amazing news, and demonstrates that we are heading in the right direction, we still have a long way to go when it comes to closing the gap between who gets funding and who gets opportunities to fund. And, while Canada is making huge strides in this area, we also have a long way to go towards a more equitable tech ecosystem. Said another way, because I’m naturally optimistic and excited how we can evolve and even revolutionize this space, there is a massive opportunity to have a positive impact on technology that will create a ripple effect in our cities, countries, and the world. But first, let’s dive into these pitiful numbers (you have been warned).

Women in Tech

5.6% of VC firms in the U.S. are led by a woman general partner (GP), a third of whom are women of colour. If you look at how many of these female GPs are founding partners, this number drops to 2.4%. Oh and just 2.6% of total capital invested in 2019 went to female-only-founded companies.

In Canada, only 13.5% of partners at venture funds are women.

Black women in Tech

Basically, the numbers are so miniscule, they basically, in my opinion, are the equivalent of a rounding error. Sigh.

0.2% of venture funding in the U.S. goes to Black founders. And for every $1.2 million that a white male founder receives in venture funding, a founder from an underrepresented group receives only $36,000.

Black women are the fastest-growing group of entrepreneurs in the U.S. However, according to a 2018 ProjectDiane report, of the $424.7 billion in total venture funding invested in tech startups since 2009, black women received 0.00006% of the funding.

I dare you to try even find these stats in Canada.

An Emerging Market within a Mature Market?

I know, I know, these numbers are depressing. But the same way the traditional investing industry looks for opportunities in emerging markets, I see these huge disparities tech as a sort of emerging market itself…and in this COVID-19 era, no travel is required to access them because they’re right here at home. Wherever there is an overlooked population, there is an overlooked talent pool, which means there’s overlooked and untapped resources…and I don’t know about you, but I plan on taking full advantage of this, not just to make money, but to drive innovation (and wealth) in an inclusive, hugely impactful way. There’s really been no better time to dive into entrepreneurship and tech investing (and you don’t have to be an accredited investor….you can invest via equity crowdfunding through the Canadian platform Equivesto!).

We are indeed in “interesting” and “unprecedented” times, which is always followed by major disruption and exciting change. There’s never been a better time to ride the wave of innovation and grow these feeble stats, so that they’re actually representative of our incredible, diverse populations.

Check out more of my writing:

Financial Advisor Melissa Allen Breaks Down RRSPs and TFSAs

If Toronto Wants to be a Global Tech Hub, it Needs to Nurture its Tech Talent

More articles about me:

Melissa Allen on Diversity in Corporate Canada | Toronto

Meet Melissa Allen, League of Innovators’ new Executive Director

League of Innovators Appoints Melissa Allen as New Executive Director

Melissa Allen of Bay Mills, and Capital M Joins LOI Venture as a Venture Partner

Melissa Allen lands Executive Director role at League of Innovators | Toronto

Why I’m Obsessed with Venture Capital and Angel Investing

By Melissa Allen. Learn more about Melissa Allen in The Globe and Mail.

I tried hard to fit in. I really did. It was 2013 and I was in the corporate cafeteria after work hours listening to yet another tech bro visiting from Silicon Valley talk about his newfound obsession with lifting and snacking on almonds “for protein.” He was actually pretty nice, but the corner of his right eyebrow shot up every time I spoke. It’s weird, the subtly nuanced—and not so nuanced—messaging we receive about how we really shouldn’t be speaking up, because not only do our thoughts, experiences, and opinions supposedly count for so little, but because they are in fact, silly—even if our insights, observations and points end up being valid (they usually are, btw). And by “we” I mean the “royal we” of women, particularly women of colour, particularly black women, particularly black women in corporate spaces, particularly black women in corporate tech spaces.

Add to this a slew of high-profile IPOs over the past 10+ years, making the SAME handful of tech boy’s club members multi-millionaires and billionaires again and again. Then we have the implicit biases in technology design and development: news reports about Google image searches mistaking black men for gorillas, black and brown people becoming insignificant objects from the perspective of self-driving cars, and women with equal qualifications being denied Apple credit cards. You know why all of these glaring and dehumanizing mistakes kept/keep happening? Because the same white, male dude bros who are investing in these companies and technologies are the same ones doing the designing and coding, and who are guiding and leading these companies. These dudes live together, work together, drink together, and go to Burning Man together. They live in a very insular world with hardly any diversity.

Imagine if all of the new and emerging technologies that will shape the world and the future of our lives, our children, our grandchildren were created through the lens and experience of privileged white men. It’s already happening. What’s scarier, and more frustrating is that it is becoming clear that society is going to be more and more reliant on these technologies, they are now woven into the fabric of everyone’s life—no matter who you are and where you live on this planet.

As a Black woman, with extensive experience in tech and finance, I realized my purpose: to ensure emerging technologies—from blockchain, to biotech, to fintech, to sustainability—all of it—are designed and built in an inclusive way, so that everyone can benefit from this new digital era. And to make a lot of money doing so. My vehicle for bring this vision is through impact investing, particularly through angel investing and venture capital. In wealth management and financial advising, Responsible Investment (RI) funds are a great way to start, as the fund management team lobbies the companies they invest in for positive change on behalf of all the fund shareholders. Having done this for many years, and realizing the huge positive difference investors and shareholders can make, I decided I want to take it a step further and use my financial skills, my resources and my network to collaborate with founders and companies in their early stages so that I can both do my part to help ensure that inclusivity happens from the start, and to, quite frankly, realize bigger returns on my investment (which follows bigger risk!).

During my phase of researching and figuring out how exactly I was going to “break in” to angel investing and venture capital (because, as I would quickly realize, even with my connections in technology and finance knowledge, the barriers to entry are really high—yet another issue) I stumbled upon a podcast series that follows Arlan Hamilton, the formerly homeless black lesbian from the southern U.S.A., as she launches her own Venture Capital fund from nothing. Those episodes, what she had to say, her non-typical perspective, and her grit and determination ignited something in me. The woman was and still is unstoppable, literally, nothing was going to get in the way of her mission of seeking out, funding, and scaling companies with BIPOC and WOC founders.

If Arlan Hamilton, who really and truly, shone a light on the hugely problematic issue of exclusivity in tech and Silicon Valley, became the beacon for its inclusivity, then why can’t I, along with other allies and BIPOCs do the same here in Canada?

In the coming weeks, I have a ton of exciting news coming down the pipeline, because I’m truly passionate about making technology and venture capital accessible and inclusive. In the mean time, if you’re at all interested in becoming an angel investor, please check out my friends, Canadian start up Equivesto—the first “equity crowdfunding” platform of its kind that removes two of the biggest barriers to becoming a start up investor: access to deals and the capital required (you can start investing with minimum $100). Another cool thing about Equivesto is its founders, one of whom is a person of colour, and the other, is a young white man who is a true ally and is determined to support and uplift female entrepreneurs and founders of colour. This is exactly what we need in tech today.

Check out more of my writing:

Financial Advisor Melissa Allen Breaks Down RRSPs and TFSAs

If Toronto Wants to be a Global Tech Hub, it Needs to Nurture its Tech Talent

More articles about me:

Melissa Allen on Diversity in Corporate Canada | Toronto | Bay Mills

Meet Melissa Allen, League of Innovators’ new Executive Director

League of Innovators Appoints Melissa Allen as New Executive Director

Melissa Allen of Bay Mills, and Capital M Joins LOI Venture as a Venture Partner

Melissa Allen lands Executive Director role at League of Innovators | Toronto