In September 2015, Arlan Hamilton was nearly broke. For over a year she’d spent every day chasing down potential Silicon Valley investors to fulfill her dream: starting a venture-capital fund that invests in female, LGBTQ, and minority entrepreneurs.
“Hamilton had met with every investor she could track down and cold-called everyone in tech she could think of. No one had written her a check. Why would they? Hamilton, an African-American lesbian, was a Silicon Valley outsider. She had no track record as a venture capitalist. And she wanted to invest in a segment of founders with little proven success,” writes Salvador Rodriguez in Inc. “She’d spent everything to bootstrap her mission. For months, she’d been homeless, sleeping on couches, in motels, out of cars, at airports. As a weary Hamilton sat, contemplating her next move, her phone buzzed.”
That buzz was a text message from Susan Kimberlin, an angel investor and startup advisor who established her career at Salesforce and Paypal: “I’m in,” it read. Kimberlin wrote Hamilton the check she needed to start Backstage Capital, Hamilton’s VC fund, which now manages over $5 million, and has invested in more than 80 sets of founders whose companies cater to markets often ignored by Silicon Valley’s predominantly white male VCs.
Hamilton first met Kimberlin in 2015 at 500 Startups’ two-week seminar for new investors in Palo Alto, where they bonded over the need for diversity in tech. Hamilton then penned a piece titled “Dear white venture capitalists: If you’re reading this, it’s (almost!) too late,” which went viral. “If you haven’t hired a team of people who are of color, female, and/or LGBT to actively turn over every stone, to scope out every nook and cranny, to pop out of every bush, to find every qualified underrepresented founder in this country, you’re going to miss out on a lot of money when the rest of the investment world gets it,” she wrote.
Her inbox exploded, and the rest is history. Backstage is now backed by Silicon Valley superstars including Slack CEO Stewart Butterfield, Andreessen Horowitz partner Marc Andreessen, Lowercase Capital founder Chris Sacca, Rose Tech Ventures managing partner David Rose, and Box co-founder and CEO Aaron Levie.
In an interview with Quartz, Hamilton explains why the moment to invest in diverse founders will never pass, how one rap song motivates her off-the-charts perseverance, and why believing women is the heart of equality.
1. What’s your big idea that other people aren’t thinking about or wouldn’t agree with? Why is it so important?
My big idea is that investing money, time, resources, access, belief—all of that—into black people, Latinx people, all people of color, and women in the US is not something that should be looked at as doing us a favor. It is doing you a favor if you are a white male, because we are the future.
Investing in us—people of color, LGBT people, and women—is good business, good sense. And you are foolish if you think otherwise. At first I think I said it politely, I think I asked. Now three years after officially throwing myself into venture capital—80 companies in, 3,000-plus companies seen—I can say without a doubt that the time is coming where you will see return on investment that you missed out on, because you didn’t listen to me three years ago. And two years ago.
But there is still time. You won’t get as much and you won’t be as respected and as recognized in the space if you start today, but there is still time.
The ability to turn the sound of adversity—the beat of it, the pulse of it—into song and lyric so that hardships and disappointment, that come every single day, can be repurposed into the drumbeat to move me forward. I think what that really means is that I have stamina and perseverance that is off the charts.
On an industry-wide or a policy level, it would be to give women—all women at work—a flexible schedule. Most women, no matter what their situation is, are multi-taskers by nature, and 9am to 5pm for a woman is not 9am to 5pm for a man in most cases. We multitask. We have a lot going on, and I think that it would be really interesting to see what would happen if you took the 40 hours that someone works and you gave her the ability to choose what those hours were throughout the week rather than 9 to 5.
I wish I would have known that a smile and a handshake does not necessarily mean it’s a done deal, or that it’s genuine, or that someone has your best interest in mind.
When I started finding out that a lot of venture capitalists were abusing their power and their position. At first, I thought that the problem was that they were ignorant about access to capital for underrepresented founders, but the bigger problem was that a lot of them were actually just abusing their position, whether that be through sexual harassment, sexual assault, or misuse of funds. Learning about those particular situations really got me down, and watching some of my heroes fall, people were friends one day and not the next, because things came out about them.
The way that I got through that was by thinking about the bigger picture: about our founders who we’re helping to enable to reach their greatness, the people who we are representing, the people who are paying attention to us and finding inspiration. All of that is bigger than I am, and all of that is bigger than the few people who are doing such horrible things in the industry.
6. A key part of success is building strong, professional relationships. What practice do you use to cultivate them with your colleagues?
I don’t have a structure for this. I try to be authentic and genuine at all times. I do think that treating everyone equally no matter where they come from, no matter who they are and what role they have, is a big key, because you never know who you’re talking to, really. You never know where they’ve been. You never know where they’re going. So, it just makes a lot of good sense to treat everyone the same and treat them well.
I try to be as present as possible in the room with someone. I think it’s hard. We all have things going on. But if you can spend two, five, 15 minutes with someone, fully engaged with them, looking them in the eye, hearing them, I think that sets you up for years of trust from that person and respect from that person, and sets up the relationship in a way that sitting on your phone and being distracted may not.
It’s always hard to answer this question because I got so much great advice from so many people along the way in my 37 years. One of the things that I do is I take lyrics from music and let that be my guiding force a lot. And one, a rap song—I still don’t know who wrote it, and I really wish I did—I heard one day said, “I came for the cake, not the crumbs.” That has motivated me in a big way. I didn’t come here for just a little bit of it. I didn’t come here to get your scraps. I didn’t come here to get your pity or your charity. I came here to go toe-to-toe with you, head-to-head with you, and to take it all.
Believe us. Believe us when we say, “I understand.” Believe us when we say, “I know how to do that.” Believe us when we say, “Now is not a good time to talk to me.” Believe us when we say, “You hurt my feelings,” or “You’ve said something inappropriate,” or “You’re offending me.” Believe us when we say, “I have a boyfriend. I have a husband. I have a girlfriend. I have a wife.” Believe us when we say, “No,” and believe us when we say, “Yes.”
The mountain I’m willing to die on… is that General Hospital is the finest television program that’s ever been in existence, and that’s no joke.
I wish people would stop telling me… how to spend my money. Strangers online sure know a lot about what I should do with my money, that’s for sure.
Everyone should own… a comfortable pair of shorts that you can lounge around in whenever you want to practice self-care.
This interview is part of How We’ll Win, a project exploring the fight for gender equality at work. Read more interviews with industry-leading women here.