How Startup Organizations Can Help Black American Entrepreneurs: An Open Discussion

Hey everybody, welcome to this Founder Institute webinar. My name is Jonathan Grecian. I'm a co-founder of the Founder Institute and we are here today. Is it— I think you might be— all right, I'm gonna spotlight video here. Okay, here I am. We're here today to talk about something pretty important and it's how startup organizations can help Black American entrepreneurs. Now the title of this webinar, it's called an open discussion. All right, and I'm a firm believer, and I think most people in startups in general are firm believers that, you know, when you bring together different perspectives, people from different backgrounds, people that have a diversity of opinions and all this kind of stuff, is where the best ideas form, and it's where sort of innovation lies. So please, anybody who is watching this webinar, do not be shy. Put your comments into the chat, put your ideas into the chat, whether you're a Black American founder that's had experiences yourself, whether you're somebody working in an organization that helps founders that's trying to figure it out, or anywhere in between, throw your questions and ideas into the chat. This is a 100% live event, and just going into the chat here, yeah, I see we got somebody from Chicago, Mike from Virginia. Welcome! Please don't be shy, throw them into the chat. John from Austin, pretty close to one of our speakers here. And yeah, throw your, throw your questions into the chat, and we're We're gonna try to make this a very communal conversation, okay? So the other thing that I just wanna throw out there really quickly is that the Founder Institute and myself as co-founder, we're certainly not coming at this issue from any kind of semblance of leadership or expertise, okay? Myself, I grew up in a very predominantly white area of the country, Westchester County, New York, and I think I saw a New York in there, so you know, You'll understand what that means. And I also went to a college, Villanova, which at least when I was there was affectionately referred to as Vanilla Nova. And even though we have a really great basketball team, don't let that fool you in terms of the composition of that school. I do believe it's gotten better, but anyway, when I went there. And even at the Founder Institute, our team personally, we do not have any Black Americans on our team. We have in the past, but we don't now. Right? So I certainly don't think at the Founder Institute we're necessarily doing a bad job, but I also think that the bar is extremely low. So that's not exactly saying much, right? And the whole point of this event is to, is to hear some different perspectives and to start to talk about some of these issues and see how not only organizations like Founder Institute, but anybody in sort of this quote unquote innovation ecosystem can start to make some changes to better support Black American founders as they build their businesses. Building a business is frickin' hard enough, right? We don't need to create any other unnecessary barriers to that massive challenge as it is. And luckily today, we do have two people that do come from an expertise position and do come from a leadership position, unlike myself and unlike the Founder Institute. They've both been through the startup journey, right? They've founded companies, they've gone to the events, they've raised funding, they tried to raise funding, and also one of them is also raising a venture capital fund right now as well. So I'm really interested to hear some of these perspectives. And I think first I'll start to introduce some of the panelists that we have today. So we have Harold Hughes. So let me just take myself off probably sound like an old person right now talking you through my actions on the Zoom. But so we have Harold Hughes, and you're piping in from Austin. Harold, tell us a little bit about your background, about Bandwagon, and some of your work at Republic.

Yeah, excellent. Thank you. I appreciate it. So I'm the founder and CEO of Bandwagon. We are an identity infrastructure company that gives companies the ability to transparently manage, aggregate, and store consumer data. So basically, really want to help your— the folks you're buying products from or buying services from really be able to curate the products and services they're delivering by knowing you better. Everyone hates spam, everyone hates vanilla and bland experiences, and so we're trying to help make that better. We are graduates of the 2015, the first cohort out of a founder institute in South Carolina. I think we're the only ones, uh, in the Carolinas was the Greenville chapter. So we went through that, um, or venture-backed. We raised just over $2 million, a couple of investors like Backstage Capital, Capital Factory, Realist Ventures, the state of South Carolina's investment arm as well. Um, we did an equity crowdfunding campaign as well via Republic. Um, so I've got experience on that and happy to share some insight on that. And now that I'm on the other side of having done that campaign, I'm also working with them as a venture partner. So if you're open and interested to learn more about potentially having a campaign on Republic, definitely let me know. And then lastly, I've been fortunate to become an angel investor in a couple of companies. That's been really, really cool because I think that oftentimes we look at how generational wealth is created, and one of those is starting the company, the other is investing. And so I'm trying to make sure we're doing both to give ourselves as many shots, you know, shots on goal as you can have. So that's what I've been up to, and I'm here in Austin, Texas.

Awesome. Yeah. And Virginia, I'm not looking at the chat right now. You may have done it already, but share some of Harold's information in there. And also, Harold, you guys just— you acquired IdealSeat as well. So for everybody else in the audience, check out idealseat.com. It's a company where you can embed registration for events and stuff into your site, something you guys are, I'm sure, is probably taking up majority of your time right now, right?

Yep, yep, that's definitely something we're excited about. We think that, you know, while the NFL and these major events aren't having fans there, a lot of us are still trying to find ways to connect, right? We desire human connectivity and we wanna be in person, and so we wanted to create a very simple tool that allowed anyone from a content creator, an artist, to a massive organization to be able to very easily create a ticketing solution and be complementary to what they do. So that acquisition worked out really, really well for us to get off the ground pretty quickly. So we're glad to have it launched as of, you know, 2 weeks ago.

Awesome. All right. Making moves in the— during COVID here.

Yeah, man.

All the way. Yeah. So Mariah Lichtenstern. And am I— I mean, I've known you forever, Mariah. Am I saying your last name correctly?

Actually, that was quite well.

I think you did.

I did. Okay.

So Mariah is a superstar. She has run our chapter in Sacramento. She's doing some really amazing stuff right now with the Aspen Institute and also is raising a fund called Diverse City Ventures. Mariah, you want to tell us about some of those projects?

Yeah, I just went through the first cohort of VC Lab too. So, hey. So first, I just want to, you know, thank you both for, you know, allowing me to be here and part of this discussion. Harold's one of my favorite founders. Founders, especially in the Founder Institute ecosystem. He knows it. We've kicked it here in Sacramento. He was actually very helpful in getting us through that, that launch. And I'm sure you can remember our pub discussion.

Yeah.

So, you know, it's, it's really a privilege and honor to be here. I started my affiliation with the, with the Founder Institute when I was a Kauffman Fellows finalist. So I always knew that I wanted to go into the venture capital track. But I entered that, you know, through Kauffman Fellows Academy courses online incubating my startup, Cineshares, which I ended up going into the Founder Institute with. So I was a female founder fellow in 2015. I was introduced by Marcus Polanco and Marcus Castro who were also directors for the Founder Institute. And I just loved what— I loved how FI offered this early-stage accelerator for people who didn't fit the mold of these other accelerators that expected you to be, you know, farther down the line. And so it was a more equitable opportunity for me to get in back into the tech scene, to, you know, connect with mentors and not have to leave my kid who was, I don't know, I think she was 5 at the time, and my family to relocate and do all of that stuff. Even though I would drive from Sacramento to Silicon Valley weekly and like stack my day with meetings. I just have to voice that I think that FI is just an amazing platform, obviously a global platform. And as a director here in Sacramento, I'm always like, you know, highlighting how, you know, one of the benefits to what we do besides being ecosystem builders and like, you know, contributing to every— all the players in a given ecosystem, we also enable, you know, founders that are ready to grow to enter into different ecosystems by virtue of FI's presence. So I consider that a really, you know, a big part of what I do, just being part of this community. I very much appreciate being here. So, you know, as you mentioned, I am the founding partner of Diversity Ventures, and maybe a little later in the discussion we can talk about how I ended up on that side of the table from being a serial founder. It was always a goal. I just didn't think that I would have to take the trajectory that I did to get here. Beyond that, I am also an advisor to a number of startup organizations, including CalSEED, which is a clean tech fund, Berkeley Skydeck, Village Capital, FinTech Forward. And that's, you know, and then of course, just with Founder Institute, it's just been an amazing way to connect with really early-stage founders, which has informed, you know, a lot of my journey because it added to what I have experienced anecdotally and personally as a founder. And it just showed that, you know, there's a core set of problems that all really early-stage founders have, and those are, they're exacerbated when you're from underrepresented groups for a number of reasons, which I'm sure we'll talk about today. So that's just a little bit about, you know, who I am. And you mentioned I am an Aspen Tech Policy Hub fellow. The project that I've worked on, being in residence in Q1 of 2020, is Tech Funding Equity, which I'm sure Virginia will throw up in the Slack. But basically, it aimed to solve the policy problem of how can we increase funding to underrepresented founders, specifically Black, Latinx, and female founders, and there's two solutions that I came up with that I'll be happy to talk about later on in the conversation.

Awesome. And Mariah obviously is saying really great words about the Founders Institute, and I appreciate that, but I also want to throw out, you know, the opposite side of this, right? One of the reasons why I'm hosting this event today is because we have gotten some negative feedback. Right, from some of the Black founders that have come through the Founders Institute program. And you— yeah. And at least— and let me know, Mariah, and Harold as well, if there's other things that I'm missing here. I mean, at least from what I've seen, it focuses on two main areas, okay? The first one is that in the Founders Institute curriculum, right, and this is essentially the journey that we put founders on when they're kind of coming from an idea and trying to get it off the ground. One of the main methods for getting it off the ground and getting some of that financing is, you know, this friends and family round, right? So, you know, statistically that is how most tech startups get started, right? But also statistically, that is much harder for a Black American founder than a white American founder, right? Or any other, you know, underrepresented founder, right? So that has definitely been a a piece of feedback that we've gotten. And honestly, I, you know, I'm going to claim ignorance here. The first time I saw that, I was like, oh, wow, okay, I didn't even think of that, right? The second thing that has been a big piece of feedback is just the lack of Black American mentors and the lack of Black American leaders that we have in the various chapters across the United States specifically, right, in our programs. Right? So those are two areas that we've gotten the feedback, you know, we're not exactly sure how we're going to, you know, fix it just yet, but I mean, would you guys agree with that?

Yeah, I mean, Mariah, I'll defer to you to get started.

Okay, well, I just have a mouthful to say about that, but I think you hit the nail on the head with the first issue, and that kind of contextualizes this project that, with the tech funding equity. So, for those who don't know, there is a huge wealth gap in our country. I think a lot of us know that there's income inequality that impacts, you know, people of color, underrepresented people of color specifically. And when I say underrepresented, I'll just give an example. If you look at like Asian Americans, which, you know, can include Chinese, Japanese, Korean, Indian, they tend to be overrepresented in the industry. And I'm not saying that as a negative, glad that they're—

Silicon Valley? Yes.

Yeah, definitely. And so, you know, it is— so when I'm saying overrepresented, I'm not saying in a negative way, but they're not underrepresented, but they're still a minority, right? And so when we're talking about underrepresented founders, it's more specifically Black and Latinx, and there's— we're not a monolith, okay? So it's, you know, the experiences vary, but When you look at the wealth gap, and if you do research into household income, in fact, I have, I don't know if it's okay for me to share here, but when you look at the income disparities within the Black community, let me just try to share the screen here. Here we go. So if you just look here at this example, that the mean wealth of white households is 8x Latinx households and 10x Black households. And that is due to a number of reasons. I mean, even if you look at someone like myself— and I'm part white, by the way. My mom was white. So I had some modicum of privilege. But she was also disabled. So another story. But when you look at, for example, I had to take student loans. Some people have parents who pay for their college. They inherit more wealth. And that's very much true in white families way more so than in Black or Latinx families. There's inheritance. There's, you know, the history of redlining where, you know, the U.S. government agencies, the Federal Housing Agency and the Homeowners Loan Corporation, explicitly denied loans to Black, you know, prospective homeowners and in Black communities, Black-adjacent communities. And that, you know, the studies have shown that, you know, the wealth gap that exists today can be directly attributed to that. So those people who are allowed to build wealth through homeownership were able to send their kids to college, were able to pull equity out and start businesses. So we're starting from behind in that regard, and that was systemic, intentional, you know, economic engineering to disadvantage Black communities. And this is in an era where you see, you know, race riots, you see Black Wall Streets being destroyed and bombed, you see that, you know, eminent domain and other government programs and policies were being used to literally destroy the stability of Black communities. And so that's where we're starting from in terms of the wealth gap. And oftentimes we're blamed for that, like, "Oh, you guys is ghetto, whatever," you know, and there's an assumption that that's everybody. It's not everybody, but when you just look holistically, this is where we're starting from. And so when you talk about the friends and family round, the friends and family round, what we have to underscore here is that it also brings in this definition of accredited investor that plays into how we can legally do offerings. And I know Harold has some insights on this with the crowdfunding piece and perhaps why, you know, he chose crowdfunding. I'd love to hear more about that. But there's an accredited investor definition that means if you're going to invest in the most favorable type of offering, which typically falls under Reg D, and I won't geek out too much about it, you have to make at least $200,000 a year have made that for the past 2 years, or have a $300,000, you know, household income and/or $1 million in net worth. Now, there are a lot of Black households that can afford to invest, but they fall below those thresholds. So to give you an example, if you look at the top 10 most affluent Black communities in America, they fall below— the average income falls below that threshold. And so, you know, there's only like 16% of Americans that qualify as accredited investors, and of that like less than 2% are Black. And so that puts into context part of the reason why we can't really successfully raise friends and family rounds. And that's part of, you know, that's one of the solutions that I'm proposing is eliminating that income and net worth-based criteria and these financial literacy tests that are reminiscent of voter literacy tests that kept Black people from participating in, you know, the civic process. It's likewise keeping us from achieving wealth equitably. So, you know, I could wax poetic about that, but I'll just start there.

And check— it's techfundingequity.com too for some of the other stuff that Mariah's doing around this topic. I mean, Harold, what are your thoughts?

Yeah, I mean, I think that for me and my startup story, it really— I really had to focus on the things that were controllable. Like, I think that Mariah's painted the background, like the infrastructure that exists. And so the alternative for us is, you know, okay, we know that this is the world, and so how do we navigate it? With Founders Institute, and to kind of set a timeline for me, I came up with my startup idea in May of 2014 and continued to work on it on the nights and weekends. I still had a day job, and that's kind of one of the premises of Founders Institute. It's like, keep your day job, Don't sell your house to try this thing you don't even know people want yet. Um, but in that year, year and a half that I was really just tinkering with this on the side of my nights and evenings, or nights and weekends, I really thought through how many data points I needed to check off. I focused on 3 things. Number 1, I need to de-risk the idea. Number 2, I need to de-risk the business model, like will people pay me and is this sustainable? And then 3, I had to de-risk myself. And so that's understanding that, you know, the disparity in funding for Black Americans, the disparity in funding for non-Ivy League networked Americans, first-time founders, and all of the myriad of things. I was based in Greenville, South Carolina. So you think about all those compounding effects as a first-time founder is trying to think about fundraising. I just had to find, figure out ways to navigate that climate. And for us, we really looked at making sure we had as much consumer data and customer data as possible. The friends and family round, I think the nuance for us was really just trying to think through, like, you know, to be clear, my family did not put any money into our friends and family round. It was definitely all friends, and I'm fortunate to have made some good relationships with folks who were able to put in $10,000, you know, a couple of people, and we, you know, we raised this money. But, you know, early on, I think that there's so much that gets tied to fundraising and being able to get this money to get started. And early on, I really think that it's got to be our focus to make sure we're creating something that folks want, make sure we're creating something that folks are willing to pay for, and how much research can we do before then. And then the rest of it is a rat race. I'll, you know, I'll be honest, like, I talked to more than 140 people before we raised our first, you know, money, and that's really tough, and it's a lot of nos. But I think, you know, the challenge is, is that As you acknowledge that there's, you know, the friends and family round is very, very difficult for Black Americans and underrepresented groups normally across the board, it's the, okay, and now what part of it that we have to address? And so one part of it is making sure we're taking up issue with the ways these regulations have been written. And to Mariah's point, I've written, written along with Brandi Andrews and several other founders, letters to the SEC. To ask for not only for the investment limits to be increased for investors, but also to change the accredited investor definition because of all the things that Mariah said. So not only do we need to make sure we're working on the policy side that's specifically holding us back from an infrastructure standpoint, but we also, as the founders who are now making micro decisions to try to do our own thing, figure out how we navigate the space, um, given that. And I think ultimately It's being able to create this level of confidence in you and your business. So de-risking the idea, de-risking the business, de-risking you, and understanding that there is a lot of, you know, a lot of heavy lifting you have to do to kind of accomplish that. And unfortunately, that's the way the state of the world is.

Right. And on the—

Could I just add, Jonathan?

Yeah, of course.

I want to point to what Harold said and really underscore the point that he's making because of these issues that disproportionately affect Black entrepreneurs, underrepresented entrepreneurs. We have a heavier burden, you know. So not only do we have to run farther and harder just to get to the starting line, but once we're there, now we're having to navigate a multitude of issues while we're trying to run a company. And every founder knows that when you go and start raising capital, you can't run your, your company full-time, right? So that's already —a full-time job.

Yeah.

And then, and then, and like, and here's another thing that just kind of goes to that. You know, Harold has done a good job of building community and network. And I feel like I've done a relatively good job of that as well. But, you know, when we're coming to the table having to spend years building a high-net-worth network or a network that can afford to put $10,000, $20,000, $50,000, $100,000 into our startups, you know, it's a very different thing from someone who comes with that built-in, who was born with that, who has it around them by virtue of where they went to school or who their mom or dad is, or et cetera. So, you know, I just wanted to underscore that point that Harold made.

That's a great transition, too, into, you know, funding. It's especially for first checks, right? The first fundings that you get almost universally, whoever's writing it, whether it's friends and family, investors, or whomever, they're investing in the person. Yeah, right, like they're not investing in the idea. It doesn't matter, you show them the greatest pitch deck that's ever been created in the history of the world, right? Like they're investing in the person, and usually that means that person's been validated by other people, right? So it comes down to networks, right? So I know, and I know, Mariah, we've talked about this before as well, you know, how, you know, Harold, were you utilizing— I know you, you know, you have a big presence presence at Clemson, and you've been very active over there. Like, you know, where were you accessing some of these networks?

Yeah, I mean, it's really interesting, and I'm going to answer two of these questions in the Q&A. So if y'all have questions in the Q&A, or for Q&A, please feel free to, um, drop them there. We'll try and get to them too. Um, no, I'm a first-generation college grad, first person in my family to go to college. Um, and I knew, you know, I wasn't like some, you know, valedictorian high school student. I went there going And my goal in college, you know, I lie to you not, was I want to graduate knowing at least one person. This was kind of dumb at the time. I was like, I want to know one person in every state so that if I get stuck in that state, I'd have a couch to sleep on. Now, granted, you look at a state as big as Texas, that'd be useless. So I need to have someone like in every city. But that was really the mindset I went into college looking at this, these 4 years, concretely saying, can I build a network that is not many people, so few people, but deep, a mile deep? You know, inch wide and a mile deep and really trying to think through building those relationships. And I think that's really something that not only do we have to do as Black founders that are getting started, but once you've gotten into the room, this is the real thing, is helping other Black founders build that network. So it would be completely, completely poor of me to get into a room and not say, hey, Mariah, you coming to this thing? And Mariah would be like, oh, what's that? It's like, just come, girl, don't even worry about it. Because that's the kind of, like, energy we need to have for it. And I think that that's where we get into the challenges. One of the questions in here is, how do we define the ability for Black Americans to afford to invest in light of not meeting or meeting the accredited investor status? To be clear, everyone can't and shouldn't be a startup founder. To be clear, everyone can't and shouldn't be an early-stage startup investor. But because this is an ecosystem, it's important for us to understand the role that each of us plays in this. So let's say that you are a software developer and you're working at Google or working at Adobe. You may not have the bandwidth to start a company or may not have just enough capital to start investing, but you may have some spare cycles to be a technical advisor to an early-stage startup, or maybe you can help take on weekend projects to help them build their MVP. Or let's say that you're the head of marketing or head of product for a consumer, consumer brand or Coca-Cola or something like that. Like, you have the ability to greenlight pilots. So you have the ability to say, hey, I've heard about this little startup. I don't know if it's gonna work, but let's give them a chance to get in front of our audience. Let's give them a chance to leverage our network. And so I think that the biggest thing is really acknowledging the fact that we all have different superpowers as part of this ecosystem and understanding we need to play our role there. And as Black Americans, it's not enough for us to be successful on our own. It's important for us to make sure we're bringing others to the table with us as we get into those rooms. And the last thing I'll say real quick, I said about de-risking the idea and de-risking the business. When I talk about de-risking an idea, it's like, is this possible? Like, could I actually build this? Like, if I want to make a flying car business, like, flying cars exist right now, but is the business model scalable? Probably not due to network efficiencies and all the other challenges that happen there. So de-risking an idea is saying like, is this, is this feasible. And then from there, like, what is the business opportunity? How do I charge? Can my revenue and profits over, you know, see the cost I'm going to need? And so really, that's how I kind of delineate between the two of those. But going back, I think the biggest thing is really making sure we recognize the position we each play in this ecosystem.

So I want to take a step back here to Jason. Jason was writing in the chat here. So even before the friends and family round becomes a challenge, right? So we're going kind of towards the ideation kind of component of building a business. You know, having this awareness around the startup alternative to, you know, going into that rat race and going into corporate America, you know, what Jason is asking or what Jason is saying is I think there's a significant opportunity to raise awareness within the Black community around this startup alternative. You know, what are your thoughts on that? Maybe Mariah, do you want to start with this?

Just, uh, startup alternative. Can you go deeper on what you mean by startup alternative? I'm looking—

let me, well, let me start on it because I think I've got some of that. But like the concept essentially is, and you were probably taught the same thing too, you were supposed to go to school and then get a good job, right? Right, like, oh yeah, I bought that hook, line, and sinker.

Exactly right.

So we were supposed to go to school. So as a Jamaican American, my family's Jamaican, I was raised in the United States. I was supposed to go to school, get good grades, go to college, get a good job. Like, that's it. You take care of your family. And so I think this question is talking about how do you make, raise that awareness for folks to say, oh, I can also be a startup founder. And that's gonna take years, in a lot of cases deprogramming. A lot of folks are familiar with the saying of like, you know, you can't be what you can't see. And so that's why we need a lot of these folks to be able to get these wins out so that other people can see that they can win. But I think the other part of this that we need to make sure to cover, and I'd love to get Mariah's thought on this, is that we have to also acknowledge, like, some of the wealthiest Black people in every city and state are state employees, have been teachers, have pensions, have worked for various parts of the government. So, like, there's ways to create a good living having done the corporate path. Or working for government. So like, as we're looking at how to create wealth, like, that is a huge opportunity. I don't want to discourage anyone from it. At the same time, we do need to try and think through, okay, how do we create more opportunities for folks to get educated on being able to start? You've got, you know, Black Girls Who Code, you've got Code2040, and all these different organizations. But I think that part of it is just acknowledging that everyone doesn't have to be a startup founder and that everyone plays a role in the ecosystem.

I think that's so important. And so, you know, I think there's Kind of goes back to this, like, network discussion, and tangential to that, which you often hear within current startup organizations is, oh, it's a pipeline problem. And so we've spent many years, you know, producing these, you know, organizations that are upskilling, you know, this population that has been, you know, like marginalized and underserved in terms of having access to even these examples and, you know, just careers. Like, for— I'm from Oakland. It's right in the middle of Silicon Valley. And I remember, you know, I think it's maybe 2016, being at an event with Ben Horowitz and others, and a teacher stood up and said, hey, I'm a teacher in Oakland schools and we're a STEM school and we don't have a computer lab. Our kids don't have, you know, and I think, you know, some work is being done in that regard. But, you know, there is this notion that there's a pipeline problem, and that's not necessarily true because there are people who are already in the pipeline, but because of systemic issues and bias, etc., they have a harder time just progressing. So, you know, just going back to my example, yes, I do think that we need exposure to entrepreneurship as an alternative, but not everybody has the risk tolerance to pursue entrepreneurship. And I think that's important. I was talking to a badass female founder yesterday, came out of Yale. She's a computer scientist, worked at Facebook. Her co-founder worked at Google. I mean, quintessential. And they still walk in rooms and they describe who they are and they're hearing from investors, well, how do you know you can build this product? Did you not hear my qualifications and background? So there's like this cognitive dissonance around the people who are already out there. But I asked her a question. I said, well, how did you decide to like forego the golden handcuffs and pursue entrepreneurship? And she had a mentor within, you know, the organization she worked for who had had a successful exit before and was like, basically, you got to have the money to take the risk. You need to have this much in the bank. Right. And the fact of the matter is, if we're dealing with the wealth gap, if we're dealing with income inequality, not everybody's going to have that high-paying job, have the money in the bank. It doesn't mean that they're not a competent and capable founder. Right? And so, you know, we have to look at that. There's a matter of risk tolerance. And so when it comes to what can organizations do, I think that there's, you know, there's a lot that organizations can do. There's a lot that the government can do, frankly. And let us be reminded here that the origin of Silicon Valley and venture capital as we know it came from government investment in the World War II effort. So we have to acknowledge that for those who like bristle whenever you talk about like government getting involved in the ecosystem. But we need to see more investment into people, and I would, you know, even posit that, you know, this discussion around basic income that's coming up, you know, could be part of it. Just having that risk tolerance to go ahead and pursue something full-time and not have to worry about if you're gonna have health insurance or be able to pay the rent or whatever the case may be. So to the original question, you know, I think that we need to increase the risk tolerance. And even with high-paying, you know, highly paid Black professionals, I've heard from a lot of like computer scientists, for example, like we don't want to forgo our stocks and our golden handcuffs and our salaries and our security. We're the one that our family is looking to to pay for funerals and pay for bills, medical bills, and all these different issues. But I do want to invest. Now, here's part of the problem. You could be a highly paid professional and you can make $199,000 a year and have $500,000 in the bank, and you're not an accredited investor. So unless you're one of 35 people in a Reg— uh, Reg D 506(b) offering that someone lets in on a deal, you're not getting in unless it's crowdfunding, and it's not going to be the same pool. And I'm not saying there's not quality offerings in crowdfunding, but I'm saying that they're separate and unequal offering and investment opportunities to even, you know, get in the game and build wealth either as a founder or as an investor.

Yeah. And so, and side note, Mariah, I invested in that company that you were talking to.

Awesome. Good bet. Just, just, uh, just to dig in a little bit on there, right? So, you know, you were— and, and this is— I think there's a biz big misconception. A lot of people will say, hey, the world of startups is fairly like egalitarian, right? It's all about the metrics, it's all about the traction, right? And that starts to become somewhat true, right? But again, that's multiple stages into the company, right? So in the beginning, and I feel like we're talking a lot about sort of the onboarding here, as Mariah said, the risk tolerance, you know, a lot of the networks that you're getting access to and that kind of stuff, you know, recruiting a team, was that, you know, something that any of you had an issue doing? Were there other forms of bias that you found, you know, again, in the earliest stages of building before you were able to produce metrics and stuff that, you know, now it's, you know, qualitative or quantitative versus qualitative, right?

Well, I think Harold is— I just think Harold's a rock star. I'll say for myself, you know, my earliest team, So I'll go back, you know, to part of the challenge is just how being able to find people who have the risk tolerance to start a startup is one thing. Then there's, you know, bias, because if I'm a Black female founder and I'm saying, hey, come join my startup, and, you know, an inquiring mind looks and says, yeah, but you're like the least likely to raise capital here, that like most underfunded. And when I, when I I came into Founder Institute as a female founder fellow. I had no idea until Catherine Finney came out with Project Diane and Richard Kirby came out with Who Is a VC. I didn't know that at that time only 13 Black women had raised over $1 million. But I watched as, like, Joel Burke Solomon, you know, won TechCrunch and was, you know, checked all the boxes. And, you know, I talked to her first institutional investor. She's probably getting tired of me telling this story, but it's true. And he said, we tracked her. We knew that she was amazing, but it wasn't our policy to write a first check. And so, you know, it came to a point where like, we've got to write a check, you know, like, but, you know, I saw people like her and Stephanie Lampkin, who's like MIT and Stanford. I'm seeing these other people out here and I'm like, if they're having the same challenge, you know, then we're spinning our wheels here. There's a deeper issue that we have to get to. So, you know, there's that part, right? There's just the bias of recruiting because people know that you're not getting equitable funding and it's a bad bet. And then there's, you know, the people who would be more likely, you know, because you share like a similar background, but they don't have the risk tolerance or they want to stay in that secure job. So for me, my earliest team was actually immigrants who did have the risk tolerance, so to speak. But the problem came where when I was out there trying to raise funding and I'm getting people propositioning me, I'm getting people, you know, thinking I'm Aunt Jemima. I mean, I just got all kinds of interesting stuff. You know, responses. The cognitive dissonance is real. I'll just repeat that again. But, you know, it came to a point where I could not sustain that team. They needed visas, you know, so I had to pay them to stay once their visas ran out. So that was definitely a challenge for me. And I think immigration is just like an overarching issue in the community. So that was definitely a problem. And yeah, and like, I so appreciated when Founder Institute, when the Me Too movement came out and Founder Institute actually put out a survey And I participated in that survey and it was asking female founders if they had experienced harassment or inappropriate conduct from mentors. And I mean, I had an experience like that, you know, even within FI, you know, and definitely outside FI where I'm going to people who are angel investors and, you know, they're hitting on me and I'm like, what? What part of the game is this? You know what I mean? So, I mean, that's more of an intersectional issue. But, you know, certainly as a woman, you know, our ability to bond with people who are in the game when it's predominantly men, predominantly white men, it's not gonna be the same. Like, we're not gonna bond over the same issues in the way that another man or another man from the same, you know, socioeconomic background is going to bond with that person. Which is part of why, like, the whole warm introductions thing is such a hot topic. Like, what are the chances of me bonding with the CEO of a VC within your, you know, that VC's portfolio? You know, even if I get an introduction or, you know, reach out cold or whatever, what are the chances of them saying, oh, you know, I really identify with this person, I believe in her, when they have no idea what my lived experiences are? So I'll just put that out there.

Yeah, no, I agree with all that. I think from building a team early on, I just had to be incredibly creative. For me, the first things I did was I— when you think about starting a startup, the first people to join are normally either former coworkers and colleagues or friends and family. But I didn't, maybe it was, you know, I didn't want to bring anyone else in that could potentially fail with me, but I didn't want to ask any friends because I didn't want to put any strain on our relationship. I had friends who reached out to me and said, hey, I want to be a part of this. I remember a couple of them, it was like, oh, 1 o'clock or 2 o'clock in the morning and we're drinking. I'm like, if you're serious, reach out to me tomorrow during normal business hours. We'll see. And of course many didn't, but a few did, and those are our early team members. Um, some person— someone asked about building a product. If you're— what do you do if you're a non-technical founder? Um, for us it's really important for, um, I'm a non-technical founder. For us it's been really important to make sure that you are able to tell a data-backed story to get a technical person to join your team early. And that's what we were able to do, and we set up a deferred compensation platform deferred compensation payment solution. Say, look, if you help us get to this point, we will pay you this much. If you help us get to that point, we'll pay you that much. You'll be the first check that we write. Our first round, we raised $310,000 because that $10,000 was going directly to him. And so I think that, you know, if you can tell a story that gets people compelled and interested, uh, that is really, really important, uh, to getting that technical person and other team members on before the money, before you raise. You got to be able to sell to potential customers and then sell to potential team members as well.

Can I ask, Harold, you know, when you were— when you brought on your early team, are these people in your geographic area?

No. So I tell people all the time, like, I don't— I didn't have the ability and don't have the ability today to discriminate on location. Like, I, you know, if you're, you know, if you're Google or whatever, you can say, look, I'm only looking for the best of people who want to move here. I was in Greenville, South Carolina, so our CTO was in Sacramento at one point. You know, we had, you know, a software developer in Charleston, we had a marketing person in Big Bear, California. Like, for us, it was really important to find people who believed in our story, who had talents that we didn't, that were willing to contribute them to help us get to that next spot.

And I think, yeah, if there's one good, or not good, but if there's one positive outcome of COVID it's making a lot of that stuff much more viable, much more realistic for a lot of people. I mean, I'm here in Colorado, by the way. So I wanna, before we get onto the next topic here on how accelerators and any startup support organizations can help with some of these challenges. I wanna get to two quick questions from the audience here. So Juan was asking, what happened to the idea that FI is working in more industries than tech to spur startups in more diverse industries? I mean, my answer to that, Juan, is it's really, it's the economic model, right? A lot of businesses in tech and startups in general, we rely on venture-size returns. And that usually means that it's a business that has to be scalable through technology. So not a business where you have to hire more people in order to make more money, aka like a consultancy or something like that. So that is our model, right? Now, there are a lot of other types of support organizations that will work with, you know, different types of non-tech businesses, right? But that's not what FI does. And I think, Harold, it sort of gets back to what you were saying a little bit in terms of just like the roles that people play, right? right, in the different parts of the ecosystem. And you guys, do you guys have any input on that?

As far as FI playing in there?

Well, just, yeah, just the different parts of the ecosystem. I mean, you can, anybody can go to like a VC, right, with a business that it just does not make sense for VC, right? So it doesn't matter who you are, where you're from, or whatever, like they're not going to fund you, you know what I mean? And with FI, like, we look for specific types of businesses as well, and you're going to see that with a lot different industries, and it's more on like a financial perspective, right?

Does that make sense? Yeah, for sure. Well, I mean, I think the thing is, you know, it's funny when people say like this is or is not venture-backable, um, because it's funny, you know, people will say like the food business isn't venture-backable, or restaurants aren't venture-backable, but then on the other side you've got these massive companies that are just like, wait, so we work as venture-backable but this real estate isn't? And so I think that when we start getting into like what is and isn't backable, it plays into these really coded kind of tropes, and so I don't like to go down that path. But instead, I really think that it's really about what do you need, what resource do you need, and where can you get it. And so if you're talking about your first $100,000, first quarter million dollars, today more than ever, I talk to founders and they'll say, "Yeah, I want to raise my first round. I need to raise a million dollars." I'm just like, "You're raising a million dollars, like off top, like round one?" I was like, I mean, go for it. Like, I couldn't do that. My first round was $300,000. And they're like, well, if I had a million dollars, I could go hire these 6 people and do this and this. And it's like, it's really, really tough to do that. And so I think it's important not only to like make sure you are getting what you need, but think about where you can get it. So if you think about raising your first couple hundred thousand dollars, that's gonna be from high net worth individuals who don't know much about your space, or maybe they do, but you're not gonna deal with the long process of a VC channel. And so you're gonna be able to move more quickly and you're not gonna have to have as much paperwork when it comes to like the legal costs. But you're also not going to be able to, like, have them open many doors for you in most cases. And then you look at educational resources like Founder Institute, incubator that allows you to kind of learn wherever you are. You don't have to necessarily travel or relocate in some of these. And you've got the Techstars and the YC, which are the more notable ones, where you do have to go normally in person. And then you've got the opportunity for podcasts and virtual boot camps. So there's a lot of knowledge that's out there in 2020. That wasn't in 2010. And I think that part of it is making sure that you're communicating in these spaces where founders are, because I think that's probably the most important relationship to build is relationships with other founders, because they'll be able to point you into resources that they used and loved or point you to things that they wish they had used and now they know about that would have avoided— saved them some pain or saved them some money that can help you avoid the pitfalls that they made.

So, you know, I would just go back to kind of what you're saying, Jonathan, in terms of the business model. I know, like, Personally, I spoke with some investors that were coming into VC Lab. They were applying and they wanted— they invest more in SMBs and like CPG, consumer packaged goods, and by— and I mean small businesses, small and medium enterprises, SMB. And I think that there is a place to apply a very similar model to what we do in venture capital to that sphere. Venture capital just tends to focus on scalable tech companies because the margins are amazing. And, you know, that's— we're looking to return funds, right? Our fiduciary duty is to limited partners. So I think that's where we get the focus on these, like, highly scalable companies. But, you know, if you have a pool of investors that wants to go and invest in SMBs or, you know, some alternative business models, you can use a lot of the same kind of principles in venture capital to do that. And I encourage people to be as disruptive as possible because we need more than, you know, SBA loans and what's out there now for small businesses. You know, that's We need to build wealth in however we can. So, and I do want to acknowledge in the thread, you know, someone mentioned SBA and I know the SBDC and there's other resources. I tapped into those myself. They weren't really focused on enterprise, like scalable tech companies at the time. And there was limitations and a lot of, you know, when you look at like what the funding options were, they didn't even talk about venture capital at all. It was all loans. And at the time I wouldn't have qualified for those loans. You know, it was right after the economic downturn. You know, thank God we have a home, but, you know, it's still— it was just like a hot mess in terms of what funding options were there and who could qualify for them. So that's not equitable, and let's not even talk about discrimination in banking. So there's that. The other thing I want to address that I see in here, someone is talking about the linguistics around, you know, Black American founders, minorities, et cetera. And I just want to give a quick example. I was on the phone one time with academics government, military government, and then myself coming from the private sector in tech. And we were all trying to say the same thing and we had different terms and we had to spend like a good 20 minutes in just defining our terms. So what I would say, if it's frustrating to you, I understand that, but bear with it and get through it because that is like the least of our problems. This is not a zero-sum game. The things that affect us as Black Americans in fact affect the entire economy. There are studies that have come out that show that discriminatory financing practices are costing the US over 9 million jobs and over $300 billion, with a B, in collective national income. And I think it's McKinsey and Company just came out with a research project that showed that the racial gap, closing the racial gap, would increase our national GDP 5 to 7% within 10 years and add at minimum $1 trillion to our economy. So this is not, you know, when you're when you have these systemic issues that were set up to appease some people that want to go riot in the streets because they think that Black people or people who are not like them are less than or less worthy or whatever pathology that is, it affects us all. So I would just say be patient, try to learn through it. I consider myself Black American. I consider myself a mixed American, multiethnic Black American. And you roll with me, you'll get what I'm talking about. Some words have synonyms, you know what I'm saying? So I don't mean that to diminish your statement. I'm just hoping to encourage you to press through learning the terminology because there's terminology in anything that you go into. So I hope that that kind of addressed your question, Jonathan, and a couple that I saw. No, yeah.

No, yeah. And, you know, not surprisingly, we're not going to get to all the topics I wanted to get to today. But this is, you know, this is not something that can be solved in an hour. Right. But I do want to just check myself here and go back to Harold. So You know, you brought up a statement there, you know, it's coded language, right? When I said before, oh, it's not venture-backable, okay? And I mean, believe me, most people in startups, they're— and this is something that I've, you know, said many times before— there's really no such thing as a startup expert, okay? Even the most successful founders, they'll get $50 million, they'll get blank checks, and they'll build something that just fails immediately, right? What was that? Kibbe or Kibbe or I don't even know that video thing that, you know, Meg Whitman and, you know, who even— it released and it failed before I even knew how to pronounce the name, right? But at the same time, like people will say there's no startup expert, there's pattern matchers, right? And again, like that all lends to unconscious bias. You know, you mentioned that this— the term just, you know, coded language in terms of, oh, this isn't venture-backable, right? And I'm sure that people can sort of use that as cover sometimes, right? And obviously, probably sometimes unconsciously, right? Probably the majority of the time unconsciously to look at a project and think that it's just not appropriate for them, right? I mean, what are your thoughts on that?

Yeah, I mean, I think that it's important to really acknowledge like what the goal is. I posted in the chat here, you know, oftentimes we've gotten so caught up in like raising venture capital, that like that becomes like the name of the game. I'm trying to build a company that's VC-backable. I want to raise money so I can do this and that. And like the idea that you're trying to build a company should be first and foremost. Like you should have a problem that you were trying to solve, that you are uniquely qualified to solve, that customers are willing to pay, and that cost that they will— or the amount they will pay is more than your cost. and there are enough of those people that you can build a sustainable business on. If you can check all of those things, there will be venture capital for you if your business gets to that point that needs it. But what happens is, is that you don't necessarily need to raise money to build these companies. In some cases, if you build a really good company, you may just have investors following, trying to say, "I want to give you money." I just saw Bryce from NDVC posted posted a quote from Katrina Lake, the founder of Stitch Fix, and she said, "To be clear, I was forced to be capital efficient. I tried to raise hundreds of millions of dollars like my male counterparts, transforming other industries, and things just haven't changed that much." And so the key to this is, it's like, listen, as a woman, as a person of color, as a non-gender binary person, as a non-gender identifying person, all these different groups, We are probably going to be undercapitalized. Today, you can put it down, August 18th, 1:54 PM, you know, Central Time, Harold Hughes said this, we're probably gonna be undercapitalized. So the opportunity in that is like, okay, well, if we exit like we expect us to, we've got Marcus Carey in the audience, he's an exit founder, we're gonna probably have more of our company than we probably expected to and, you know, desire to. That doesn't say that the journey is not gonna be incredibly hard and even harder than it would be, But it's just being able to figure out what do we need to do to navigate it. Like, I don't want this to be a conversation where Mariah and myself come on and talk about how really, really difficult all this is and not leave you all with any solutions. The importance of this is really trying to think through, if I chase customers and try and gain revenue, venture capital, if it's necessary, will be there, and there are different funds, and now you've got rolling funds, and now you've got all these different funding opportunities, there's crowdfunding. doesn't run into the issues with the Reg D. There's lots we can cover on that, we're running out of time. So I definitely think number one, if you focus on your customers and solving the problem and generating revenue, that's huge. But number two, really being intentional about building relationships with founders in a way that you can have a complete trust and relationship, not transactional, where you go and share and they share and it's therapy. Like, that's where you have the opportunity to be able to build relationships, they're gonna open doors for you. And so I think that leaving this conversation, if you're able to take away a couple of things, one of Bandwagon's main principles is in collaboration. Like, I believe so strongly in collaboration. Like, yeah, no one's signing an NDA. Like, I want to tell you everything I'm working on in hopes that you can say, oh, we tried that, that will fail, this is how it failed, maybe try a different way. I'm like, oh, didn't think of that. But I think that's where we run into these problems where we think, oh, I've got this precious thing I don't want to share with the world. Until it's ready. And the challenge is, is like, how do you emphasize solving a customer's problem? And then can you do that at a point where it makes you money? And then are there enough of those people that makes you a lot of money? And you'll find that a lot of businesses become venture-backable at that point.

I promise. So does it— just because we're running up on time here, I mean, Harold and Mariah, I'd love your thoughts on this as well, right? As a startup support organization, Obviously, a lot of focus is towards funding. And one of the reasons why FI was created, by the way, was for people to understand, like, no, your next step is not funding. You have like 1,000 steps before that, right? That literally is the founding story of Founder Institute. So, you know, in terms of how any of these startup organizations can better help, you know, not just, again, building companies harder, not building it as a Black or a female founder, or any person of color or minorities is much harder. You know, do you think just focusing much more on that process will put them in a much better position before even trying to raise funding? Or, you know, what are some of your thoughts on that?

I think that's happening. You know, and if you look at, you know, I say geography plays a part. And I'm so glad that, you know, there is an exodus right now from San Francisco and that we're moving away from this notion that you got to come here and build here because it's just, it's another part of the problem. If you look at what's going on in Atlanta, if you look at what's going on in ecosystems that people aren't even up on where there are affluent Black communities that are relatively self-sufficient and insular, you know, it's a different dynamic. But like, I think that one of the reasons why underrepresented founders are such a promising investment, and you can look at Kauffman Fellows research that shows that, you know, diverse founding teams and executive teams outperform their all-white counterparts on realized exits. I think it's partially because we do have to have this efficiency because we don't have, you know, the same access to capital. We don't have the same chances to fail. It's like, you know, I'm gonna shoot my shot, right? And so I think that those efficiencies, you know, lend to better business models. So I think everything that Harold said is great. I tell people, don't go for VC unless you because you absolutely need it. And really, VC is rocket fuel when you've already validated. So I think that, you know, in terms of what organizations can do, I think, you know, again, one of the reasons why I got involved with Founder Institute was to build that network that I did not have. You know, I didn't come from a high-net-worth background. My mom was a nurse. You know, both my parents ended up disabled by the time I was an adult and launching a startup. But I had, you know, some money to start with, start my company with, and I needed to access, you know, other networks. Works beyond what I had with everyone looking at me as being the one who's supposed to be supporting everyone, right? And that's part of a Black tax. So I think that what organizations can do is, you know, and this is a conversation that's come up a bit, is look at the distance traveled. You know, not just at like, okay, where are you now, what boxes do you check, but what distance did you have to travel to get there? And what is the likelihood of, you know, you going, you know, 10x as far with just like a fraction of the resources that your counterparts have? Because that's what we see in our communities. I think there's a lot of emphasis on mentorship, but the emphasis needs to be on sponsorship. Don't just tell me what to do, especially if you don't have my lived experience, because what works for you may not work for me. So, you know, one, learn what my lived experience is. But if you are going to say, hey, do this and this will work, then open up your Rolodex, right? Like, put your actions where your words are, right? And be more than an ally. Be an advocate. Be an accomplice, right? So I think those are some things that organizations can do at scale. And that's like, you know, promoting and putting on and, you know, like helping these people who may not have access to underrepresented founders see, here we are and we are viable. So I think that that's like a key role that organizations can play.

Yeah, the one thing I was gonna say before we close out is that I think that as you look at the ecosystem. And Mariah hit it, like sponsorship is the level. That's what we're trying to get to. So when you see allies on the internet and they say like, "Oh, I'm an ally," it's like, "Okay, cool, like where are you showing that? Where are your actions lining up with it?" I think the biggest thing we look at, whether it's Founder Institute or any of these other organizations that are trying to figure out how you get more Black founders invested or how you hire more Black talent, you know, we don't want to see you have a bunch of Black interns and no Black executives. And so we don't want to see, you know, we don't, we don't want to see different breeds of dogs on the team page and not see any of us represented in the team page, right? And so it's really, really important to try and think through what are the necessary things that you need to take, the necessary actions you need to take to put ourselves in a position to win. And so if you look at Founder Institute, I mean, I'm a director here at Austin now. So Austin Founder Institute, I'm a director here, and since I've come in, I think I've brought in at least half a dozen Black mentors, because I think that's really important for folks to be able to see it. And so when you think about what you can do, it's the playing your position in the ecosystem. You can make waves wherever it is you are. If you're sitting on this call right now and you have $10 in your bank account that you can spend, go buy a CPG product from a Black-owned founder. Go on Republic.co and invest in a minority-owned or woman-owned or veteran-owned or disabled-focused company, because there's opportunities where venture capital is not it. And I think that this exodus of San Francisco and being able to emphasize the fact that there's more out there is really gonna empower us. But I think that that all starts with us being able to leave with actionable steps and acknowledging the fact that we do have some control, even though the deck is rigged against us. There's some control we still have, and we should definitely flex it.

Yeah, definitely one of the things that we want to do and, um, is, yeah, just, just more Black mentors, uh, more Black local leaders. This was something that we did with our Female Founder Initiative a couple years ago, and it led to a massive increase. But just by having more leaders, uh, like Mariah, and more mentors, right, it just, it just starts to access these other networks. So, all right, yeah. And I love this concept of sponsorship versus ally, or sponsor versus ally, right? I've seen that word ally thrown out there a lot, but I guess, is the idea there, Harold, does sponsor just mean that you're putting a check behind that, or you're putting your money where your mouth is, or does it just mean—

I'll defer that to Mariah, I'll defer that to Mariah since she threw it out, but for me, I was just more so saying that in a lot of cases, we need people who aren't gonna be writing the check, to help in some other ways. Everyone has value they can create, whether you are working at a, you know, big business and you can sign a letter of intent. So I can say, I've got a letter of intent with Coca-Cola, that is valuable to me. Or if you say, man, I can't afford to invest, but I'm gonna make sure I buy one box of your cookies every month just to make sure I tell my friends about them and I post about them. Like, there's a lot we can do, but I'll defer to Mariah about what sponsorship opportunities everyone can leave this conversation with.

I just think that's a great point that Harold made. Basically, you have mentors that are like, do XYZ, this is what I have done, right? And I've had several mentors, but when I went out to do XYZ, it didn't work for me as a Black female because I face different barriers and dynamics. So, you know, you— there's books written about it, there's a lot of discussion about it, mentor versus ally and— excuse me, mentor versus sponsor. So a sponsor is not just is saying this is what you do, this is how it's done. It's saying, here, let me open this door for you. Let me walk you in the room. Let me use my influence to make sure that you're getting seen, heard, backed, et cetera. And it's very— it's talked about a lot in corporate right now. And then there's an ally versus a complot. So you look at Black Panther, for example, in Wakanda. You see the guy who went to Wakanda to get his gunshot wound treated. You know, he went from being an ally to being an accomplice when he got in that spaceship and started shooting, right? So it's moving beyond the lip service to actually sustained action where you're taking on some of the same risks, some of the same— you're empathizing and just walking in the shoes. It's like getting out and protesting, right? Like, I'm not saying everyone should do that, but it's going beyond just saying, "Oh yeah, I support," you know, and actually doing something to make a change.

All right, well, I'm not gonna keep you guys much longer. Thank you for joining. Everyone, please, that's on the line, thank you for the questions, thank you for the input. Check out Mariah's projects that she's working on. There's the DiverseCityVC.com, right? If I'm not mistaken. DiverseCityVC.com, yeah. And TechFundingEquity.com. Also Harold with BandwagonFanClub.com. And idealseat.com, the newest project there, and also republic.co, which is a really cool and effective equity crowdfunding service. So yeah, thanks everyone for joining. I certainly learned a lot from this conversation, and I'm probably gonna be shooting Mariah and Harold a couple more emails as we start to formalize some of the changes that we're gonna be making, But this was great.

Excellent. Now, thanks for the opportunity. Mariah, as always, great opportunity to share the stage with you.

You rock. I'm glad to be here with you. Bye everyone. Thanks everyone.

Have a good one. Bye. Bye.