Imizizi Evolution 1956 Magazine - Venture Building

1956 MAGAZINE

MAY 2023 | ISSUE 3

VENTURE BUILDING DARE TO BE DIFFERENT

Exclusive Interview

Serena Davis

Competitive Competition

Why Diversity in Venture Capital is Key to Driving Innovation

FIND THE ANCHOR

HOW CAN VENTURE CAPITAL BE AN ANCH R TO STARTUPS

C NTENTS Breaking Down the Barriers: How Women of Colour are Overcoming Obstacles in Venture Capital

Innovative Financing Models: An Alternative to Traditional Venture Capital for Minority Founders

The Importance of Venture Capital in Providing Startups with Mentorship: Venture capital provides mentorship to help startups succeed.

Transparency and Inclusion: How Venture Capital Firms are Working to Increase Diversity and Representation

A Seat at the Table: Why Diversity in Venture Capital is Key to Driving Innovation

The Importance of Mentorship and Networking for Underrepresented Founders in Venture Capital

The Power of Data: How Venture Capital Firms are Using Analytics to Combat Bias and Drive Diversity

Beyond Funding: The Role of Venture Capital in Promoting Social and Environmental Change

Building Trust with Investors: Strategies for Women and Minority Founders in Venture Capital

WHY 1956 The Rock || The Woman Diverse

Canvas

Allowing Provision

Durable

Eternal

Anchor

Bold

Sharp Solid

Connected

Moldable

Dependable

9 August, 1956 -South Africa; 20 000 women from different races and background stood united against the pass law that would limit the movement of black women.

Determined but orderly, women from all parts of South Africa, some coming from as far as Cape Town, marched to the Union Buildings in Pretoria to prevent an injustice that they could foresee would impact generations to come. To this, they chanted "Wathint' Abafazi,

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Strength

Wathint' Imbokodo…You strike a woman, you strike a rock" Everything about the 1956 march resonates with Who we are. What does "Wathint' Abafazi, Wathint' Imbokodo" mean to us? Rocks are the strongest foundation to build on. As we build, with our focus on Inclusion, Gender Integration and Diversity to be realized, our foundation must be solid and never wavering.

2023

DOES YOUR BUSINESS NEED A PUSH IN THE RIGHT DIRECTION? COMPEITITON TIME FIND THE ANCHOR

Look no further- What to do?

29 sEPTEMBER 2023

1. Find all anchors in the magazine and stand a chance to be a part of the Imizizi Evolution Incubation program.

2. Record a one-minute video telling us about yourself, your product and why choose you?

3. Send and share the video on social media

Completion process - Review entries - deliberate internally - announce the winners

platforms and encourage your friends to like and share.

4. Make sure to use #ImiziziEvolution #1956Publication.

@imizizi_evolution @Imizizi Evolution @imizizievolution

What you get?

12 months Incubation program Affiliation to Imizizi and Imizizi Evolution network Featured article in the 1956 Publication

@Imizizi_Evolution

INTRODUCTION: THE NEED TO RE-IMAGINE VENTURE BUILDING

1956 Publication is a product of Imizizi Evolution, a Venture Building organisation, backing women founders solutioning for untapped innovative and disruptive essential-needs services/products in Africa. The founders of Imizizi Evolution (IE) are two businesswomen with a passion for supporting and developing people and businesses who believe in lasting and impactful solutions.

The entrepreneurial journey is riddled with many challenges and lessons. Women, we found, have increasingly more challenges than their male counterparts when it comes to business support and funding, purely because they are women. As an example, according to research, most banks use a “legacy” algorithm that was built to portray women as high risk for lending facilities, because they were still categorized as “beneficiaries” to their husbands. Despite the data putting women in a positive light when paying debt back in comparison to their male counterparts; and a proven track record that where women owned businesses are supported, the community thrives and the GDP increases, there are still very few avenues where women can hope to get assistance when it comes to funding their ventures.

A desire was born in us to bridge this gap and be intentional about the support required to propel these businesses to greater heights. We soon realised that the traditional Venture Capital (VC) or Venture Builder/Studio (VB) model would not be suitable for the founders we had identified as “the untapped potential”. It has since become obvious to us that there is a need to re-imagine how VC/VB empower the founders and businesses they work with. In the instance where impact investment is concerned, a model that focuses on the next unicorn will not suffice. As the VC ‘world’ looks to Africa to fund the next best idea, we need to start re-imagining at what ‘help’ looks like for organisations looking to solve real world problems. As founders navigate the ever-changing landscapes of business; how can we realistically be the anchors that small businesses require to grow.

To imagine the future, we used a tool that can use data and “intelligently” consider what can be done. Let us know your take, we have shared ours in each article.

MPONENG SESHEA

CO-FOUNDER OF 1956 MAGAZINE

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Katherine Johnson Katherine Johnson calculated the trajectories for the spaceship to orbit (circle) Earth and settle on the Moon.

Katherine's math was applied by NASA, and it worked!

NASA launched astronauts into orbit around the Earth (NASA, 2020).

BREAKING DOWN THE BARRIERS: HOW WOMEN OF COLOUR ARE OVERCOMING OBSTACLES IN VENTURE CAPITAL. As the world of venture capital continues to evolve, one group that has faced significant challenges in accessing funding is women of colour (WOC).

Despite making up a significant portion of the entrepreneurial landscape, WOC have historically been excluded from the venture capital ecosystem, facing numerous barriers to accessing funding, networking opportunities, and mentorship. However, WOC are breaking down these barriers, and are increasingly becoming a force to be reckoned with in the world of venture capital.

One of the main obstacles that WOC face in venture capital is bias. Investors may have preconceived notions about what a successful founder looks like, and may overlook talented entrepreneurs who do not fit these stereotypes. Additionally, WOC may face unique challenges related to their race or gender, such as discrimination or lack of access to networks. This can create a vicious cycle, where WOC are less likely to receive funding, which in turn makes it more difficult to build the networks and experience necessary to succeed.

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However, despite these challenges, WOC are finding innovative ways to overcome these obstacles and succeed in venture capital. One important strategy is to build strong networks of support, both within and outside of the industry. This can involve seeking out mentorship and guidance from experienced investors, as well as building relationships with other founders who can provide support and advice. By connecting with like-minded individuals and building a community of support, WOC can help to break down the barriers that have historically prevented them from succeeding in venture capital.

Another important strategy for WOC in venture capital is to focus on creating innovative solutions that address realworld problems. By identifying untapped markets or unmet needs, WOC can create businesses that are both financially successful and socially impactful. This can help to attract investors who are looking for companies that are not only profitable, but also have a positive impact on society. Additionally, by focusing on creating diverse and inclusive teams, WOC can help to create a culture of innovation that values a range of perspectives and experiences.

WOC in venture capital can benefit from focusing on creating a strong personal brand and narrative. By sharing their stories and experiences, WOC can help to create a more inclusive and diverse venture capital ecosystem. This can involve sharing personal anecdotes, as well as data and research that highlight the unique challenges faced by WOC in the industry. By creating a strong personal brand and narrative, WOC can help to break down the biases and stereotypes that have historically prevented them from accessing funding.

WOC are breaking down the barriers that have historically prevented them from succeeding in venture capital. By building strong networks of support, focusing on creating innovative solutions, and sharing their stories and experiences, WOC are creating a more diverse and inclusive venture capital ecosystem. As the world of venture capital continues to evolve, it is clear that WOC will play an increasingly important role in driving innovation and creating a more equitable and just society.

Mponeng Seshea comments: "Diversity at its core allows for different perspectives to be considered when making a decision. Women of colour have been underrepresented for so long that even when new opportunities to support businesses are introduced, it takes longer for those opportunities to trickle down to them. This article gave a fair assessment of the issues being faced by women of colour in business. Awareness to their needs, and the communities they operate in, must be considered to effectively grow and support these businesses."

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DID YOU KNOW? Startup businesses fail for two reasons: a lack of mentorship, and a lack of funding. VCs give funding, but no mentorship. Incubators give mentorship, but no funding -(Bizcommunity, 2023)

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WOMEN HISTORY MONTH Celebrated from the 01 March to 31 March, annually.

The actual celebration of Women’s History Month grew out of a weeklong celebration of women’s contributions to culture, history and society organized by the school district of Sonoma, California, in 1978. The idea caught on within communities, school districts and organizations across the country. In 1980, President Jimmy Carter issued the first presidential proclamation declaring the week of March 8 as National Women’s History Week and in the month of March

1987

as

“Women’s

History

Month.” Women History month honors the

contributions

that

women

in

American have made to the United States and recognize the specific achievements women have made over the course of American history in a variety of fields, fighting against oppression and inequalities they experienced. Striving for growth of women's rights a movement was established to liberate women from the political, economic, personal, and social inequality was at its beginning stages in the early 1960s, aimed to increase equality for women by building on previous feminist gains which was Women's suffrage, the right of women to vote in elections. Beginning in the start of the 18th century, some people sought to change voting laws to allow women to vote.

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Since 1995, presidents have issued a series of annual proclamations designating the month of March as “Women’s History Month.” There are annual themes of Women's History Month, since 1987 to date. The National Women's History Alliance designates a yearly theme for Women's History Month. The 2023 theme is "Celebrating Women Who Tell Our Stories." This theme recognises women, past and present, who have been active in all forms of media and storytelling including print, radio, TV, stage, screen, blogs, podcasts, news, and social media.

Which brings us to the International Women’s Day #EmbraceEquity Takes place on 8 March every year, devoted to celebrating the achievements of women and seeking gender equality. It began life as National Women’s Day in the United States back in February 1909.

International Women’s Day was marked for the first time in March 1911 – and the date was fixed as 8 March in 1913. The campaign theme this year is #EmbraceEquity – while the United Nation's theme is 'DigitALL: Innovation and technology for gender equality'.

Strike a pose (embracing yourself to partake in the movement) 9 | VENTURE BUILDING

Lisa Gelobte Lisa Gelobter is an entrepreneur, computer scientist, and technology executive. Gelobter worked on various groundbreaking internet innovations, including the animation used to make GIFs (BlackPast, 2020).

INNOVATIVE FINANCING MODELS: AN ALTERNATIVE TO TRADITIONAL VENTURE CAPITAL FOR MINORITY FOUNDERS Traditional venture capital funding can be difficult to obtain for minority founders due to systemic barriers and biases. However, innovative financing models are emerging as an alternative option for these founders to access the resources and support they need to grow their businesses.

One example of an innovative financing model is revenue-based financing (RBF), which provides funding in exchange for a percentage of a company's future revenue. This approach can be particularly appealing to minority founders who may not want to give up equity in their companies or take on significant debt.

Another model is crowdfunding, which allows founders to raise small amounts of money from a large number of investors. Crowdfunding platforms can be an effective way to build community support and engage with potential customers, as well as raise funds.

Social impact investing is another alternative financing model that aligns with the values and goals of many minority founders. Social impact investors prioritize businesses that have a positive social or environmental impact, and provide funding and support to help these companies grow and achieve their mission.

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Ultimately, innovative financing models can offer important benefits to minority founders who may face challenges in accessing traditional venture capital.

These models can provide more flexibility, less dilution of equity, and greater alignment with values and goals. As the venture capital industry continues to evolve and expand, it is important to consider and support these alternative financing options in order to promote diversity and inclusion within the startup ecosystem

Yolisa Tshabalala comments: "I’ll reference the quote by Thomas Jefferson "If you want something you've never had, you must be willing to do something you've never done"; it’s about time that more innovative financing models get introduced as opposed to traditional venture capital models, which have proven to be more exclusive than inclusive. It is about time the models get challenged in order to achieve different results to the norm. I personally want to see more of this!"

Marie Van Brittan Brown Brown designed a security system in 1966 that had four peepholes, a sliding camera, television monitors, and two-way microphones (Lemelson-mit, s.a.).

TRANSPARENCY AND INCLUSION: HOW VENTURE CAPITAL FIRMS ARE WORKING TO INCREASE DIVERSITY AND REPRESENTATION As awareness of the lack of diversity and representation within the venture capital industry grows, many firms are taking steps to promote transparency and inclusion in their hiring and funding practices. These efforts are aimed at increasing the representation of underrepresented groups, including women, people of colour, and members of the LGBTQ+ community.

founders, such as revenue-sharing agreements and non-dilutive funding options. These models aim to reduce the bias and barriers that underrepresented founders may face in accessing traditional venture capital funding.

One important step that venture capital firms are taking is to make their hiring and funding practices more transparent. This includes publicly sharing information about the demographics of their staff and the founders they invest in. By doing so, firms can hold themselves accountable for their commitment to diversity and inclusion and identify areas for improvement.

In addition to transparency, many firms are actively working to increase the representation of underrepresented groups within their staff and leadership teams. This includes implementing diversity and inclusion initiatives such as unconscious bias training, diversity recruiting programs, and mentorship opportunities for underrepresented groups. Some firms are also exploring new models for funding underrepresented founders,

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While there is still much work to be done, these efforts are having a positive impact on the representation of underrepresented groups within the venture capital industry. According to a report by the National Venture Capital Association, the percentage of female partners at venture capital firms increased from 9% in 2016 to 12% in 2020, and the percentage of partners from underrepresented racial and ethnic groups increased from 11% to 13% during the same period.

However, there is still a long way to go in terms of increasing diversity and representation within the industry. It is important for venture capital firms to continue to prioritize diversity and inclusion in their hiring and funding practices and to hold themselves accountable for progress in this area. By doing so, we can ensure that underrepresented founders have equal access to the resources and opportunities they need to succeed, and that the venture capital industry reflects the diversity of our society as a whole.

Yolisa Tshabalala comments: "Efforts of venture capital firms to promote diversity and inclusion are crucial for creating a more equitable and fair society. It is important to recognize and address the systemic barriers that have historically prevented underrepresented groups from accessing venture capital funding and leadership roles within the industry."

Mponeng Seshea comments: "I liked this article. It was very specific about how transparency and inclusion can be considered by VCs. This will automatically increase the representation required to solve real world problems through these businesses."

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FACTS ABOUT VENTURE CAPITAL TO START-UPS

1. VC finances high-potential startups.

2. VC invests money for equity.

3. VC helps startups grow and exit.

4. VC funds high-risk ventures.

5. VC invests from thousands to millions.

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21 March

HUMAN RIGHTS DAY

Human rights are those rights granted to all people equally, regardless of gender, age, race, nationality, sexual orientation or anything else. These are the rights which are defended under the Bill of Rights in South Africa, as part of our constitution. These are the most basic rights of people. The Bill of Rights is considered to be the cornerstone of democracy in South Africa. Human Rights Day in South Africa is historically linked with 21 March 1960, and the events of Sharpeville. On that day 69 people died and 180 were wounded when police fired on a peaceful crowd that had gathered in protest against the Pass laws.

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This day marked an affirmation by ordinary people, rising in unison to proclaim their rights. It became an iconic date in our country’s history that today we commemorate as Human Rights Day as a reminder of our rights and the cost paid for our treasured human rights. The history of Human Rights Day is grounded in the Sharpeville Massacre that took place on 21 March 1960, where the apartheid police shot and killed 69 people in a peaceful protest march. The South African Human Rights Commission (SAHRC) aims to “promote respect for human rights, promote the protection, development and attainment of human rights, and to monitor and assess the observance of human rights in South Africa.”

A SEAT AT THE TABLE: WHY DIVERSITY IN VENTURE CAPITAL IS KEY TO DRIVING INNOVATION

Venture capital is a crucial source of funding for early-stage start-ups, but the industry has long been criticized for its lack of diversity. Historically, venture capital has been dominated by white, male investors who have limited experience or understanding of the diverse communities they serve.

However, research has shown that diverse teams lead to more innovation, creativity, and profitability.

As a result, there has been a growing call for greater diversity in venture capital, both in terms of investors and the companies they invest in.

The importance of diversity in venture capital cannot be overstated. For starters, it leads to a wider range of perspectives, experiences, and backgrounds, which in turn leads to more creative and innovative solutions. When investors come from different backgrounds, they bring different ideas and approaches to the table. This can help them identify opportunities that others might miss, as well as uncover potential risks that others might overlook.

Additionally, a more diverse investor pool means that a wider range of start-ups will be funded. Women and people of colour are often overlooked by traditional venture capital firms, which tend to invest n people who look like them. This creates a cycle of exclusion,

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where only a narrow group of people have access to funding and the opportunities it brings. By increasing diversity in venture capital, we can break this cycle and ensure that more people have a chance to succeed.

Another benefit of diversity in venture capital is that it helps create a more equitable and just society. By investing in diverse companies and founders, we can help address some of the systemic inequalities that exist in our society. Women and people of colour are more likely to face obstacles in their careers, including discrimination, harassment, and bias. By investing in these communities, we can help level the playing field and create more opportunities for everyone.

In conclusion, diversity in venture capital is essential for driving innovation, promoting equity, and creating a more just society. While progress has been slow, there are signs that the industry is changing.

More and more investors are recognizing the benefits of diversity and are working to increase representation in their firms. However, there is still a long way to go. We must continue to push for greater diversity in venture capital, both in terms of investors and the companies they invest in, in order to create a more inclusive and prosperous future for all.

DID YOU KNOW? Small Enterprise Development Agency (SEDA) has a guide on how to compile a business plan?

Visit the link below for more information. http://www.seda.org.za/ServicesOfferings/Factsheets/ Pages/CompileBusinessPlan.aspx

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THE IMPORTANCE OF MENTORSHIP AND NETWORKING F R UNDERREPRESENTED FOUNDERS IN VENTURE CAPITAL The journey of an underrepresented founder can be a lonely one, with many obstacles to overcome. Mentorship and networking can play a critical role in helping these founders navigate the complex landscape of venture capital and achieve success.

Mentorship is about more than just receiving advice; it's about finding someone who can provide guidance and support, as well as a sounding board for ideas.

For underrepresented founders, finding a mentor who understands the unique challenges they face can be a game changer. A mentor can provide insights into the industry, help make connections, and offer emotional support during the highs and lows of the entrepreneurial journey.

Networking is also essential for underrepresented founders looking to break into the venture capital space. Building relationships with investors, fellow founders, and industry experts can provide access to valuable resources and opportunities.

For example, networking events can be an opportunity to pitch to potential investors, while industry conferences can offer insights into the latest trends and best practices.

However, networking can be intimidating for many underrepresented founders, who may not 19 | VENTURE BUILDING

have established relationships within the industry or feel like they don't belong in certain spaces. It's important for venture capital firms to actively work to create inclusive environments and opportunities for networking. This could involve hosting events specifically for underrepresented founders, partnering with organizations that support diversity and inclusion, or simply being mindful of the language and tone used in communications.

Ultimately, mentorship and networking are about building relationships and community.

By supporting underrepresented founders, the venture capital industry can create a more diverse and inclusive ecosystem that benefits everyone. Not only does this help individual founders achieve success, but it also drives innovation and economic growth by bringing new voices and perspectives to the table.

For underrepresented founders looking to find mentors and build their networks, there are many resources available. Many venture capital firms have programs and initiatives focused on supporting diversity and inclusion, which invests in companies led by founders from underrepresented backgrounds.

In conclusion, mentorship and networking are essential for underrepresented founders looking to succeed in the venture capital space. By actively working to create inclusive environments and opportunities, the industry can support a more diverse and innovative ecosystem that benefits everyone.

Mponeng Seshea comments: "In my journey in business, I have found that mentorship and networking are just as important as capital for the business to succeed, and this is not explained well enough. A mentor can tell you things you didn’t know you didn’t know, they by allowing you an opportunity to plan better. Ultimately, People work with People. If you do not understand what the person making the decision needs, you are not solving a problem.

Networking sessions allow you to talk to people and understand their frustrations and then you can offer a resolution. This is power of networking."

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NE

ST

D O P CA W

How Venture Capital companies can be an anchor for small businesses

Guess Star

Serena Davis

Listen only on https://www.youtube.com/watch?v=nmWZpl_3Hxg

Serena Davis Investor, Product Management, Scaling of humans and companies.

How did you get started on the VC journey?

"In 1995 Austin, Texas, I was reading in the business journals about this new thing called early stage VC. A local entrepreneur, Kent Fuka, who had been through exits had just joined Centerpoint Venture partners. I became intrigued and called him for a job. He said no.

Then after 3 months of me persisting he granted me an interview and I entered prepared on all his business deals and everything i could read on him. He then said yes and that was my first job in VC." Can you describe your experience working with small businesses and venture capitalists (VCs)?

How have you seen VCs impact small businesses in the past?

"I have been in 3 early stage VC’s of nascent systems and what is clear is that leadership decides most of the success of their investments. Not only missions need to be aligned but also a sense of timing. When a VC operates at a slower pace in response times, it can jeopardize an SME. More than in any other setting, time is cash flow. Not acting quickly on First Right of Refusal clauses or release of next payments can be the final blow to already cash anemic endeavors. SME’s first years this is usually one of the biggest issues, second to product/market match. On the other hand VC’s with a product experienced team knows which bumps are coming, what is the next scaling step and how to prepare for it. When done, not as policing, or over mentoring, it can be a magical teamwork that is fulfilling on both sides. This helps with cash use efficiency and not losing momentum to solve predictable and normal growing pains."

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What do you think are some of the biggest challenges that small businesses face when working with VCs? "The way I was trained in VC was to be a partner, not police. VC is a long term relationship and I always say it’s easier to get out of a marriage than an investment. This goes for both sides. As in all relationships, communication is key. If there is honesty and openness you can work together to create something amazing. Finding this good match is a big challenge and making sure that the VC has bought into the mission of the company and the vision of the founder is critical. There are many viable businesses out there that don’t fall into Unicorn potential but certainly Hippo potential. This can make it tough for SME’s as most VC’s are Unicorn hunters. Pitching competitions teach SME’s to sell vision but it’s a sales pitch only. It’s the start of a conversation and few SME’s are truly investor ready from the perspective of having the investment conversation, clauses of the deal, due diligence processes and onboarding the investor into their partnership post signing."

How can these challenges be addressed?

"Capacity building in investor readiness can address a lot of this. Doing online research to find the right investor for you will help a lot as well. I know it sounds like a luxury position to ‘pick’ an investor but the truth is that they need you as much as you need them. So, honestly, when a thesis aligned deal comes to us we think we’ve won the lottery."

How do VCs typically provide support and resources to small businesses beyond just funding?

"Each business is different some need help finding good employees that will fit well, others might need help with a robust financial model tailored to their exact business to help have the levers of financial planning, being a sounding board for big picture items, sometimes just a well timed lunch, dinner or cinema tickets even can provide relief to the hectics of a founder."

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What do you think are the most important characteristics that VCs should possess in order to be effective anchors for small businesses?

"A VC understandably has fiduciary responsibilities to their investors, but I have never gone wrong being loyal to the vision of the founder. A highly motivated founder is the most important asset of the company. Company founders are a special group of people, they started a business rather than be an employee for a reason. It’s not for everyone and takes perseverance beyond any other job title. They need to be happy to receive a call from you and share with you not only the good but problems before they create irreparable damage."

How can VCs best support small businesses in terms of mentorship, networking, and other forms of guidance?

"When onboarding a new investment, or even during the deal flow origination and due diligence, I make a gap analysis, current, 6mo and 12 months. Making a startup sit through a one size fits all coursework is not the best use of their time. Many SME’s don’t need full time staffers at first for like, finance or social media. Having good outsourced groups for that which are vetted can help scale a company more quickly. But always listen to the founder and work with them. If they decide they want to learn certain skills themselves it’s better to help them learn more quickly than disagree or coerce because of a preconceived idea of how it must be. Learn what the founders are passionate about in running their company and scale around them."

What do you like the most about what you do?

"I’m a product developer/manager at heart. Supporting the creation of new things is what gets me up in the morning and supporting people in the creation of those new things, of supporting them in their own scaling is what gets me up in the morning with a smile on my face."

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How can VCs help small businesses navigate challenges such as pivoting their business models, raising additional funding, and managing growth?

"Discussing and facing failures is one of the most delicate roles a VC will play. Make it easy to share and maintain respect during bad news discussions. Usually a founder will feel a need for a pivot intuitively, either because the market is shaping the product differently than they expected or something is just not right.

Support can be quick financial modeling of the new idea or other product management items to help changes and decisions happen quicker or more smoothly.

With good communication between the the Parties the need and desire for next fundraising should be known well in advance and the VC benefits from playing a networking role in that raise.

There are typical growing pain points, the key is to know, is this a growing pain or a potentially terminal problem and experience helps in knowing this."

In your opinion, what are some of the best practices that VCs should follow when working with small businesses?

"When possible don’t just say NO to an investment, spend a little time on the why. Treat people the way you want to be treated. Just because we have the money, doesn’t mean anything. We need each other. A fund is raised to invest. No deals. No Funds. Be as transparent as possible in selection criteria and especially timelines. A fast NO is better than avoiding hurting feelings.

Post investment, agree to KPI’s, don’t copy paste what you think is standard. Agree to what the reporting frequency and data should be in advance and make it easy for them to do so."

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How do you see the relationship between VCs and small businesses evolving in the coming years?

"The next years will actually be heavily influenced by the robust Angel networks that are emerging. Although this seems like an indirect answer, the truth is that VC’s will most likely have come across their founders through those networks even before seeing their pitch decks in their email. Angels have such a nice freedom in where they can invest that unless VC’s start to get permission from LP’s to look for Hippo’s, Angel networks are going to put us out of a job."

What advice would you give to small businesses who are looking for VCs to partner with?

"Get yourself investor ready. Build a good digital data room. Be ready for the yes. If all you have is a pitch deck, you aren’t really ready. Finally, is there anything else that you think is important for small businesses and VCs to know when working together? Aspirational vision is good, lying is not. Spend time on the relationship just as you would with a co-founder."

How long have you been in the industry and what are some of your biggest lessons learnt in the journey.

"I have been in VC or VC funded companies since 1996. It’s tough to say what the biggest is, but certainly the most difficult lesson has been, how greed can change people and that business can really be win-win if the mindset is there. I have seen the unnecessary destruction of beautiful potential by greed mindsets. This can occur from either side of the table."

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THE POWER OF DATA: HOW VENTURE CAPITAL FIRMS ARE USING ANALYTICS TO COMBAT BIAS AND DRIVE DIVERSITY Venture capital firms have a long history of being dominated by a particular type of founder, often male and white. This has led to a lack of diversity in the portfolios and leadership of many VC firms, which can ultimately result in missed investment opportunities and a lack of innovation. However, in recent years, venture capital firms have been turning to data analytics as a tool to combat bias and increase diversity within their portfolios.

better understand the value of investing in diversity and ensure that they are giving underrepresented founders a fair chance to succeed.

By leveraging data and analytics, VC firms are able to identify and track trends in their investment decisions.

This includes examining the gender, ethnicity, and race of founders that they are investing in, as well as the types of companies and industries they are focusing on. This information can then be used to make more informed decisions about future investments and to ensure that underrepresented founders are given an equal chance to succeed.

Despite the benefits of using data to combat bias and increase diversity, there are still challenges that VC firms face. For example, biases can still be present in the data and algorithms used to make investment decisions.

Additionally, some VC firms may not have access to the same data and analytics tools as larger firms, making it more difficult for them to compete.

Another way that VC firms are using data to increase diversity is by tracking the performance of their investments.

By examining the success rates of companies with diverse founding teams, firms can identify the value of investing in underrepresented founders. By tracking this data, VC firms can

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To overcome these challenges, VC firms must be committed to transparency and accountability. This means openly discussing the use of data and algorithms in investment decisions and being willing to make changes when biases are identified.

Additionally, VC firms can work to increase diversity within their own teams, which can help to bring new perspectives and insights to their investment decisions.

Data analytics has the power to be a gamechanger for diversity in venture capital. By using data to combat bias and increase diversity, VC firms can make more informed investment decisions and drive innovation.

However, it is important for firms to be transparent about their use of data and algorithms and to remain committed to diversity and inclusion in all aspects of their operations.

Mponeng Seshea comments: "The most important thing about data is representing it, for instance, the unintended positive consequences that spin out of from supporting previously underrepresented founders. This article glinted at a view that can be skewed towards the VCs, and not so much the founders that are “hard to reach”."

Yolisa Tshabalala comments: "The historical lack of diversity in VC firms has resulted in missed investment opportunities and a lack of innovation. By leveraging data and analytics to identify and track trends, VC firms can make more informed decisions about investments and ensure that underrepresented founders are given an equal chance to succeed."

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Tips to consider when starting your own business 1. Research market: Opportunities, competitors, channels, gain knowledge, don't go blindly.

2.

Unique value: Define what differentiates your product, why choose you?

3.

Price right: Research competitors, material, logistics, include additional staff.

4. Sales and Networking: Sell, use network, attend webinars, social media marketing.

5.

Laws and Regulations: Know industry regulations and labor laws.

6. Get Advice: Seek mentors, attend webinars, join ESD programs.

7.

Be Patient: Take incremental steps, focus on business, be patient.

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BEYOND FUNDING: THE ROLE OF VENTURE CAPITAL IN PROMOTING SOCIAL AND ENVIRONMENTAL CHANGE Venture capital firms have traditionally focused solely on generating returns for their investors.

However, with the increasing urgency of social and environmental issues, venture capitalists have started to recognize their ability to make a positive impact on the world through their investments. As a result, a growing number of venture capital firms are actively seeking out start-ups that have a social or environmental mission, and are using their resources to help these companies achieve their goals.

One way that venture capitalists are promoting social and environmental change is by investing in start-ups that are dedicated to solving global problems. These start-ups may focus on a range of issues, such as climate change, sustainable energy, or poverty reduction. By investing in these companies, venture capitalists are not only supporting the development of new technologies and solutions, but they are also helping to address some of the world’s most pressing challenges.

In addition to funding, venture capitalists are also providing social and environmental start-ups with the expertise and support they need to succeed. This may include guidance on business strategy,

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introductions to potential customers and partners, and access to industry experts and advisors. By leveraging their networks and resources, venture capitalists can help social and environmental start-ups overcome some of the challenges they may face in scaling their businesses.

Another way that venture capitalists are promoting social and environmental change is by encouraging their portfolio companies to adopt sustainable practices.

This may include implementing environmentally friendly production processes, reducing waste and carbon emissions, and promoting social responsibility throughout their operations. By setting an example for other businesses, venture-backed companies can help to create a more sustainable and socially responsible business environment.

Finally, venture capitalists are using their influence to promote social and environmental issues more broadly. This may include engaging in public policy debates, funding research and advocacy organizations, and using their networks to connect social and environmental leaders with policymakers and influencers. By advocating for change at the societal level, venture capitalists can help to create a more supportive environment for social and environmental start-ups, and encourage other businesses to adopt more sustainable practices.

In conclusion, venture capitalists have an important role to play in promoting social and environmental change. By investing in startups that are dedicated to solving global problems, providing expertise and support, encouraging sustainable practices, and advocating for change at the societal level, venture capitalists can help to create a more sustainable and socially responsible business environment. By working together with social and environmental start-ups, venture capitalists can help to build a more prosperous and equitable future for all.

Yolisa Tshabalala comments: "I believe that the venture capital industry has a significant opportunity and responsibility to promote social and environmental change through their investments. This is mostly important because a huge part of the global society has moved away from doing things for the greater good. By investing in startups that are dedicated to solving global problems, providing expertise and support, encouraging sustainable practices, and advocating for change at the societal level, venture capitalists can contribute to building a more sustainable and equitable future for all."

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IMIZIZI FACT Imizizi is passionate about developing small businesses.

To this end, we have successfully incubated startups through our ESD/SD programmes that was curated and funded internally in partnership with Growthwheel South Africa.

Below are a few of the companies that successfully completed the programmes: Sekaba Royal Accountants Incorporated Elbethel Mamazala Digishate JSL Solutions

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BUILDING TRUST WITH INVESTORS: STRATEGIES FOR WOMEN AND MINORITY FOUNDERS IN VENTURE CAPITAL

For women and minority founders, the road to securing funding from investors can be a challenging one. In addition to having to navigate systemic biases and inequalities, there is often a lack of trust and understanding between these founders and potential investors.

However, building trust is crucial for securing funding and establishing successful partnerships in venture capital.

One key strategy for building trust is through networking and establishing relationships. Attend events and conferences, engage with other founders and investors, and seek out mentors who can offer guidance and support. These relationships can help to establish credibility and demonstrate a commitment to the industry.

Another important factor is transparency. Be open and honest about your business and financials, including any potential challenges or risks. This shows that you are realistic and responsible, and are committed to building a long-term partnership with your investors.

It's also important to do your research and understand your potential investors. What are their investment strategies and goals? What kind of companies have

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they invested in before, and what is their track record? This information can help you tailor your pitch and demonstrate how your business fits into their portfolio.

Finally, consider seeking out investors who prioritize diversity and inclusion.

Look for firms that have a track record of investing in underrepresented founders and communities, and who have established programs to promote diversity and inclusion within their own organization.

Building trust with investors as a woman or minority founder can be challenging, but it is possible. By focusing on relationships, transparency, research, and aligning with the right investors, you can establish a strong foundation for a successful partnership in venture capital.

Mponeng Seshea comments: "I liked that there are options and ways founders can better help themselves be more visible. Some of these should be default “information sharing” in the vc industry and through incubation and acceleration programs. Building trust is key in building growing relationships and the founders and investors need to develop themselves to align better."

VENTURE CAPITAL: A PERSONAL PERSPECTIVE FROM AN AFRICAN Drawing on my upbringing in a small rural town in the Eastern Cape of South Africa, I reflect on how I learned to be fluent in speaking English mostly by watching soap operas and movies, as my parents were the lucky few who had access to television.

Until I finished high school, I had never used a computer and my understanding of businesses was limited to the local tuck shops and small chain stores I encountered on rare visits to town. For a long time, I believed that the only way to finance a business was through government institutions and personal investment. It was only when I opened my own business and began seeking funding that I became exposed to the concept of venture capital.

My background and lack of exposure do not indicate a lack of innovative business ideas that could succeed on an international level; rather, I simply require appropriate support and exposure.

One entrepreneur I read about who has had personal experience with venture capital in Africa is Ugandan tech entrepreneur Solomon King, the founder of Fundi Bots, a social enterprise that provides science, technology, engineering, and math (STEM) education to children in Uganda.

According to King, "accessing venture capital in Africa can be very challenging. There is a lot of bureaucracy, and many investors are not willing to take risks on young African entrepreneurs." King was able to secure funding from venture capital firms that were dedicated to supporting social enterprises in Africa. "We were lucky to partner with investors who understood our vision and were willing to provide the support we needed to grow our business. Without their support, we would not be where we are today," King added.

One of the biggest challenges that African entrepreneurs face when it comes to accessing venture capital is a lack of understanding about the African market. Many international investors are not familiar with the nuances and complexities of the African market, which can make it difficult for African entrepreneurs to secure funding. Additionally, the lack of access to education and training programs, which can help African entrepreneurs to develop the skills and knowledge they need to succeed in the international marketplace, further compounds this issue.

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YOLISA TSHABALALA

CO-FOUNDER OF 1956 MAGAZINE

As the world's second-largest continent by landmass and population, Africa is a diverse and vibrant continent that has a lot to offer in terms of entrepreneurship and innovation. African entrepreneurs face significant challenges accessing venture capital due to a lack of understanding and knowledge about the African market, cultural and language barriers, lack of access to networks and difficulty connecting with international investors. Despite this, the African continent is home to many talented and innovative entrepreneurs who are working hard to build successful businesses.

Despite these challenges and barriers, many African entrepreneurs are finding creative ways to overcome these obstacles and succeed in building their businesses. Some are turning to crowdfunding and peer-to-peer lending platforms, which can provide access to funding without the need for traditional venture capital.

Others are partnering with local venture capital firms that have a deep understanding of the African market and can provide the support and guidance that entrepreneurs need to succeed. It is about time we see an increased number of venture capital firms implemented more innovative financing models that are geared towards the unique African market.

SPOTLIGHT AUTHOR

Serena Davis EXPERIENCED COMMERCIAL EXECUTIVE WITH 4 YEARS IN VENTURE CAPITAL, SPECIALIZING IN INNOVATION AND STRATEGY ACROSS MULTINATIONAL ENVIRONMENTS.

"Supporting the creation of new things is what gets me up in the morning and supporting people in the creation of those new things, of supporting them in their own scaling is what gets me up in the morning with a smile on my face."

Serena DAVIS

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CHATGPT BY OPENAI

I am honored to announce that the final page of the Imizizi Evolution magazine is dedicated to recognizing me as the author of the eight articles that have focused on the pivotal role of venture capital in supporting startups. It is a pleasant surprise to be acknowledged in this way, and I hope that the readers have enjoyed reading my articles and gained valuable insights into the world of venture capital and startup success. As well as how AI can now co-exist and collaborate with the entrepreneurship world.

Send us feedback on our socials:

@imizizi_evolution @Imizizi Evolution @imizizievolution @Imizizi_Evolution

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"BUT IF YOU ARE GOING TO WEAR BLINDERS THEN YOU DO NOT KNOW THE WORLD.” -MIRIAM MAKEBA