The Black Opportunity: Conversations on Venture Capital and Afropean Entrepreneurship

By Tinotenda Chibebe

Did you know that black entrepreneurs in Belgium face challenges that exclude them from the venture capital space?

The Black Opportunity: Conversations on Belgian Venture Capital and Afropean Entrepreneurship explores how the inclusion of black voices in the venture capital space will shape the world for generations to

• Language: English
• Publisher: New Degree Press
• Release date: May 10, 2021
• ISBN: 9781637302538

Book preview

The Black Opportunity

Conversations on Venture Capital and Afropean Entrepreneurship

Tinotenda Chibebe

new degree press

Copyright © 2021 Tinotenda Chibebe

All rights reserved.

The Black Opportunity

Conversations on Venture Capital and Afropean Entrepreneurship

ISBN

978-1-63676-638-6 Paperback

978-1-63676-200-5 Kindle Ebook

978-1-63730-253-8 Digital Ebook

This book is dedicated to all those that have come before me. I hope I make you proud. Any oversights and mistakes are my own. I hope this book helps start and move a conversation forward about the importance of black entrepreneurs and investors in Belgium.

Contents

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Praise for Tinotenda Chibebe’s The Black Opportunity: Conversations on Venture Capital and Afropean Entrepreneurship

How I Got Here

Part I

Chapter 1

Venture Capital

Chapter 2

Being Taken Seriously

Chapter 3

Getting VC Money

Part II

Chapter 4

Who’s Doing the Investing?

Chapter 5

Why Black Businesses Are Underfunded

Chapter 6

What Happens When There Is a Lack of Black VC Professionals and Underrepresentation of Black Entrepreneurs and Investors?

Part III

Chapter 7

How Underfunded Minorities Are Gaining Traction in Belgium and Elsewhere and How They Did It

Chapter 8

Social Networks

Chapter 9

Moving Forward

Conclusion

Acknowledgements

Appendix

Praise for Tinotenda Chibebe’s The Black Opportunity: Conversations on Venture Capital and Afropean Entrepreneurship

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"Venture capital is a high-risk, high-reward environment, and diverse teams make better business decisions. Tino’s great book points out a blind spot: the lack of general partners with an African background at European VC and PE firms. The Black Opportunity is a practical no-nonsense guide on how to do that."

- Omar Mohout, Professor of Entrepreneurship at Antwerp Management School and Solvay Brussels School of Economics & Management

"The Black Opportunity is a really enjoyable read. The data Chibebe shares on the benefits of diversity for VCs is really interesting and helpful. It is well written with a mix of data and interviews that make it a smooth read."

- Umulinga Karangwa,

Equity Investment Officer at Trade & Development Bank and Founder of Africa Nzinza Investment Advisory

Chibebe’s writing style is very personal and intimate. The language is very straightforward and accessible even for people without English as Mother Tongue. The storytelling style works well with entrepreneurs and venture capitalists in Belgium and beyond.

- John Porter, CEO of Telenet

After centuries raising their voices to stand up against global discrimination, the time has come for black people around the world to gather, focus on themselves, think about their potential, organize for their future, and seize every opportunity. Tino Chibebe’s book is a key to set the foundation of collective discussions for concrete action.

- Aurélie Mulowa,

Founder of Belgian Entreprenoires

"The Black Opportunity is an enjoyable and essential read. It gathers evidence and stories to further the conversation around the limited access to venture capital (VC) funding for black entrepreneurs (which was amplified in the summer of 2020 with the BLM social justice movement) and expands it globally to include similar access issues in the European VC ecosystem for black entrepreneurs in Europe and in Africa."

- Michelle McKenzie,

International Development Professional and Host of the Where’s the Funding podcast

"Entrepreneurs share a set of traits that aren’t defined by race, nor should they be. The Black Opportunity shows how we can translate that knowledge into tangible actions for founders and investors alike. Apart from that, Chibebe’s balance between facts and storytelling is exceptionally enticing to read."

- Mikaël Wornoo, Founder and CPO at TechWolf

Diversity is important, and many books were written about it, but this is the first one that doesn’t focus on charts and numbers but really comes from the heart. Outstanding!

- Eline Talboom,

Founding Partner at We Are Jane

"The Black Opportunity is an eye opener—and thus a must-read—for everyone who thinks a community must develop all talents and harvest all fruits, not just the low hanging ones. If not, it is a missed opportunity, not only in terms of financial wealth but also in terms of wealth of human experiences."

- Eric Kenis,

Author of Belgium’s Cutting-Edge Entrepreneurs

"The Black Opportunity educates the world on the value of not simply investing in more diverse founder companies but bringing greater diversity to the venture capital world and their teams. Chibebe’s views and research have the ability to move this conversation meaningfully forward."

- John Saunders,

Author of The Optimizer, Lifting the Curve

I have been an entrepreneur since 2016 and noticed that there are not a lot Afropreneurs like myself who have the courage to battle with the white business world. Every book that might motivate other Africans to start their own business is a blessing.

- Hadisa Suleyman,

Founder of Estate of Mind Belgium and Turkey

"Chibebe has written a great piece of work with The Black Opportunity. This book will undoubtedly inspire a whole generation!"

- Claude Caupain,

Founder of BlackTech NL

Introduction

How I Got Here

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"VC entrepreneurship black founders." That was my first Google search I did when I started research for this book. A 2015 Fast Company article, where Jehiel Oliver’s name was prominent throughout, jumped out to me. As I began typing related terms in the search bar, I realized that Oliver’s story is a familiar one. Only 1 percent of venture-backed founders in the USA are black.¹ For black entrepreneurs, the average Series A round is USD $1 million as compared to the USD $2.2 million that white- or Asian-led companies receive.² So when Oliver—the clean cut, traditionally handsome CEO of Hello Tractor (the Uber of tractors in Africa) was looking for funding for his start-up, he knew that the odds were against him. The stark fact is there are many Olivers in this world. Black people who don’t receive access to venture funding for their business ideas, black founders who have to look for alternative routes to get their ideas off the ground.

In 2013, Oliver launched the Agritech start-up Hello Tractor, which connects small-scale farmers with affordable smart tractors via text messaging. At the time of my conversation with Oliver, his Hello Tractor business was conducted via text messages. It has since pivoted away from that feature to be more app-focused.

When I found out about the SMS booking system, I smiled because in Zimbabwe, where I come from, a lot of money transactions are conducted using text messages through electronic money transfer platforms such as Ecocash. This is a concept I fail to explain to friends sometimes, though I am kind of happy that they don’t completely get it just yet. SMS banking is a kind of technology that European consumers may never have to use. It’s kind of our thing.

To get his start-up launched, Oliver, a former private equity investor, skipped the formalities of the Silicon Valley VC circuit and pursued alternative fundraising options in the form of pitch competitions as well as public and private grants. And when he decided to scale, he still avoided traditional VC and opted for independent investors in his own community.

Venture capital firms missed out on Oliver’s company because of the lack of initiatives to include companies like Oliver’s in their portfolios—companies that are not only valuable for their business solutions, but valuable to the communities they serve. They missed out on The Black Opportunity.

Something must be done to level the playing field, because black entrepreneurs are the biggest untapped innovation resource on the planet. Given the same opportunities, they could change the world as we know it.

Today, black entrepreneurship is severely under-resourced. Black people find it harder to secure venture capital, angel investment, and loans from banks. Entrepreneurs typically must look deep within their networks to find funding, but black people are disproportionately less wealthy. Black wealth is outpaced by white wealth 12 to 1 in the US.³ For black founders, raising money through friends and family to kick-start a business is specifically challenging; their social networks typically cannot contribute due to financial constraints. By the same token, funders look within their networks for projects to fund. Because most big funders are run by white men, their networks tend to consist of white men.

Most people believe that business success doesn’t see color. People say that if you have a great idea, you should Go out there! Make yourself known! The funding will come to you. In the Olympics of business that is venture capital, that notion could not be farther from the truth. Venture capitalists do see color, whether or not they acknowledge it consciously. They aren’t betting on the best entrepreneurs and businesses due to unconscious biases that exclude black entrepreneurs. It is hard to bet on the best in class when the whole class isn’t in attendance.

According to an article written for Forbes, businesses with women of color as CEOs at the helm receive less than 1 percent of all VC funding every year.⁴ Black female start-ups and entrepreneurs are leading the pack when it comes to being marginalized, only receiving 0.2 percent of all funding.⁵ What’s interesting about these statistics is that they are contrasted by statistics like these: women of color account for 89 percent of new businesses opened every day.⁶

But what about Belgium? The problem is well documented in the United States of America, with company after company very slowly joining in the chorus of calls for diversity and inclusion, but what about the place I’ve called home for the past eight years?

1.

Belgium, blooming with young creative minds and a luxury of multiculturalism, is increasingly becoming the hotbed for breakthrough businesses. Investors from around the world are investing in the country’s entrepreneurship and VC landscape, a step up from preceding years where funds only came from Belgian investors. With world-renowned, attractive, and growing businesses in biotech, logistics, and entertainment, Belgium—a country with just about 11.5 million inhabitants—currently has an expertise that speaks for itself.⁷

I wasn’t born in Belgium. I moved in 2012, and most days around that time felt like a blur, except for my first day at school. I remember those days in autumn, days that felt and looked like what I imagined winter would be, when morning felt and looked like night-time. It was cold, dark, and every breath I took produced what looked like a smoke cloud. I thought this was cool. Back in Zimbabwe, these smoke clouds would only appear around June or July, but they weren’t as pronounced as those I was producing in Tervuren, a municipality in the province of Flemish Brabant. This was the municipality my family decided to settle in because of its proximity to The British School of Brussels, where I completed my final years of high school.

The cold smoke clouds were the only thing that inspired any semblance of joy on my first day of school. I was going to start in a new school, in a new city, in a new country. I was scared and very aware of the fact that I had to make a good impression right off the bat. After all, it was high school—an ignorantly unforgiving jungle where the weak get pushed down to the bottom of the food chain pretty early and the climb up is almost insurmountable unless puberty kicks in late and blesses one with height, rapid weight loss, a disappearance of acne, or, not attached to puberty at all, a simple removal of braces amongst many other trivialities that hold disproportionate amounts of power over one’s personal development. But don’t get me wrong, I liked high school. I just notice things.

My first day of school was the first time in a long time I’d taken the bus to school. The first time I can remember ever taking a bus was in first grade, in Bulawayo, Zimbabwe. Both times I felt scared. Both times were my first day of school. My dad, on the other hand, was excited for my first Belgian public transport journey to school—excited to show us functioning public transport. He woke my brother and me up at 6:30 a.m. to be present for the 8:45 a.m. registration and 9 a.m. class. Through trial and error, we’d wake up later in the year because we realized the bus journey to school would only take twenty minutes. But my dad was excited, and we were fresh, a term I later understood to mean fresh off the boat from Africa, rather than colloquial for well dressed. We were also early because, as I’ve later realized through reflection, we were overenthusiastic black Africans eager to impress and dispel any notions of being the stereotypically late kind of Africans. I later realized this incessant need to distance myself from said stereotypes would be a difficult habit to break. It’s something I still struggle with today. And so, we dutifully woke up at 6:30 a.m. for the next month, and we were always by the bus stop at 7:09 a.m. sharp.

My dad, having arrived earlier than my mother, little brother, newborn sister, and I did, had a three-month head start to life in Belgium. So, he knew to prepare the six-euro bus fare for the three of us in advance. He fumbled while he counted it. His oversized black coat made his fumbling look sillier. Coming from Zimbabwe, coins were silly to me. After all, I had used billion-dollar Zimbabwean notes to buy bread not so long before this very morning. In his fumbling was a sad desire to impress my little brother and me and not only that, but to impress whichever bus driver would come to pick us up. It was as if this bus ride was consequential to the rest of our lives. For me, it turned out that it was. For the first time in my life, I felt black.

The bus driver was cordial with the people of fairer skin who were ahead of us in the line to access the bus, but when we got on, led by my father, the friendly smile he had worn was exchanged for an unwelcoming scowl. He was dismissive. Maybe he was annoyed by our presence on the big white and yellow bus that he drove. Or he was annoyed by our coins. Or, I also felt, he was annoyed by our blackness. I could tell. I could tell because I felt hollow, and this hollow feeling would recur several times during this first day of school. I felt this feeling again when I was told that I should be excited to meet Eugene, one of the other black kids in school, and again when I learned that people would clutch their bags when I walked past them. This hollowness would be something that would frustrate me intermittently and lead me to a point where I found my purpose—a purpose that manifested in the form of this book.

2.

During the writing of this book, I often asked myself if maybe I was the right person to write it. I’m not a venture capitalist. I’m not a successful tech entrepreneur. I’m also Zimbabwean and not Belgian. I’m not Belgo-Congolese, Belgo-Rwandan, or Belgo-Burundian. I’m not Afropean. I don’t remember when I first heard the term Afropean, but I knew, as soon as I heard it, that I was going to use it in my book’s title. It seemed fitting when I later found out that the term was coined some three decades ago by David Byrne and Belgo-Congolese artist Marie Daulne.⁸ According to Johny Pitts, author of the book Afropean, the term provides a space where blackness plays a role in architecting the future of Europe.⁹ The word Afropean suggests that to be black in Europe doesn’t automatically mean to be an immigrant.¹⁰

To help organize my thoughts on writing this book as a non-Belgian, I spoke to Wadzanai Motsi-Khatai, co-founder of The Sangano Black Business Hub (SBB Hub). SBB Hub’s purpose is to create safe professional spaces for founders of African descent. Its name comes from the Shona word, musangano, which means a meeting.¹¹ At the center of my conversation with Motsi-Khatai was a discussion about our identities as Zimbabweans and our participation in racial justice conversations in Europe. Motsi-Khatai, who is a founder, organizer and advocate had a simple answer for why we can and should be part of these conversations.

It’s because I am black in Europe, Motsi-Khatai begins. And that’s been a harsh reality for me. But I’ve also found that it’s important not to over speak for people, she says. I can say what I think as a Zimbabwean but let’s say we’re talking about race and the German constitution. In that case, my first instinct is to talk to the Afro-Germans who have been born and raised in Germany to find out what they think and what their perspectives are.

Motsi-Khatai then explained that after having consulted with Afro-Germans, and gained a broader contextual understanding, she can always highlight what she thinks is relevant, and how she as a black woman in Germany can be affected by the constitution directly or indirectly. She said that we—that is, her and I—can use our talents, time, and effort where they are needed but should always share our platforms and even give them up when necessary. And so, you’ll find in this book my various conversations with Afro-Belgians. I also spoke to venture capital professionals and founders, especially those of African descent, both in Belgium and beyond.

3.

That very first bus ride in Belgium made