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Study Hall: Navigating the Tech Space for Black Entrepreneurs · Earn Your Leisure

• 0:00
  Speaker 1: An illegal alien from Guatemala charged with raping a child
• 0:03
  Speaker 1: in Massachusetts. An MS thirteen gang member from Al Salvador
• 0:07
  Speaker 1: accused of murdering a Texas man of Venezuelan charged with
• 0:11
  Speaker 1: filming and selling child pornography in Michigan. These are just
• 0:15
  Speaker 1: some of the heinous migrant criminals caught because of President
• 0:19
  Speaker 1: Donald J. Trump's leadership. I'm Christy nom the United States
• 0:23
  Speaker 1: Secretary of Homeland Security. Under President Trump, attempted illegal border
• 0:28
  Speaker 1: crossings are at the lowest levels ever recorded, and over
• 0:31
  Speaker 1: one hundred thousand illegal aliens have been arrested. If you
• 0:35
  Speaker 1: are here illegally, your next you will be fined nearly
• 0:39
  Speaker 1: one thousand dollars a day, imprisoned, and deported. You will
• 0:43
  Speaker 1: never return. But if you register using our CBP home
• 0:46
  Speaker 1: app and leave now, you could be allowed to return legally.
• 0:50
  Speaker 1: Do what's right. Leave now. Under President Trump, America's laws,
• 0:55
  Speaker 1: border and families will be protected.
• 0:57
  Speaker 2: Sponsored by the United States Department of Homeland Security.
• 1:00
  Speaker 3: All right, so you recently just closed around. I believe
• 1:03
  Speaker 3: you raised ten million dollars as a reg CE equity
• 1:06
  Speaker 3: crowdfunding correct.
• 1:07
  Speaker 4: Yeah reg CF Yeah, ten million in three rounds, So
• 1:11
  Speaker 4: all right, and you're the first black person, black man
• 1:14
  Speaker 4: to do that. Yes, history has been made. Kudos to that, congratulated, gratulations.
• 1:20
  Speaker 3: So can you explain to the audience what exactly does
• 1:23
  Speaker 3: reg CF equity crowdfunding. There's a lot of different words here,
• 1:28
  Speaker 3: What exactly does that mean? And why is it significant
• 1:32
  Speaker 3: what you have been able to do?
• 1:34
  Speaker 2: Well?
• 1:35
  Speaker 4: I think it's very important because African American people and
• 1:40
  Speaker 4: minorities have a really tough time raising capital for their businesses,
• 1:43
  Speaker 4: going to banks to get loans, We're going to venture
• 1:46
  Speaker 4: capital to raise capital. And so in twenty twelve, Barack
• 1:50
  Speaker 4: Obama and Joe Biden kind of launched this regulation called
• 1:53
  Speaker 4: the Jobs Act and then went into it went into
• 1:56
  Speaker 4: law in twenty fifteen, which means any person can raise
• 2:01
  Speaker 4: capital from the general public for their business, regardless of
• 2:04
  Speaker 4: their net worth or annual income up to one million dollars.
• 2:07
  Speaker 4: That was the first rule. So we did that and
• 2:12
  Speaker 4: twenty twenty. So think about how important that is for
• 2:15
  Speaker 4: people that aren't accredited investors to invest. But then someone
• 2:19
  Speaker 4: like me that had a startup that wanted to raise
• 2:22
  Speaker 4: capital but VC was not necessarily rout at the time,
• 2:25
  Speaker 4: or me going to get a bank loan to raise
• 2:27
  Speaker 4: an excess of a million dollars. So that's why that's
• 2:29
  Speaker 4: important for any business that you want to start, primarily,
• 2:33
  Speaker 4: you know what I'm saying, like small businesses, which fan
• 2:35
  Speaker 4: base was at the time, to be able to raise
• 2:37
  Speaker 4: capital and significant.
• 2:40
  Speaker 5: For those who want to break into the tech space.
• 2:44
  Speaker 5: What advice and insights would you give those who may
• 2:48
  Speaker 5: feel like it's not for us. And if you can
• 2:51
  Speaker 5: do your journey all over again, what steps would you
• 2:54
  Speaker 5: wish you would have taken to get here faster?
• 2:57
  Speaker 4: Ooh, everything for us? Everything. There's nothing that you know,
• 3:02
  Speaker 4: we can't do as a people. So every single solitary
• 3:04
  Speaker 4: thing that exists on the planet. You know, we can
• 3:07
  Speaker 4: go to space, we can build tech, we can you know,
• 3:11
  Speaker 4: invent cures for diseases, all kinds of stuff. So I
• 3:15
  Speaker 4: don't think there's anything we can't do. I would say, study,
• 3:20
  Speaker 4: you know, learn the landscape. I had to study the
• 3:22
  Speaker 4: landscape of social media. I was kind of like a
• 3:24
  Speaker 4: person that used social media a long time before, but
• 3:27
  Speaker 4: just studying the landscape of how social media works, it
• 3:32
  Speaker 4: was interesting to be able to like jump right in.
• 3:35
  Speaker 4: I honestly would not change anything, And I know that
• 3:37
  Speaker 4: sounds crazy. I feel like my inexperience in the space
• 3:42
  Speaker 4: gave me an opportunity to go down my own path
• 3:46
  Speaker 4: and not try to follow what other people have done,
• 3:49
  Speaker 4: which probably would have wound up dead ends or maybe
• 3:51
  Speaker 4: had me discouraged in what I was trying to do.
• 3:53
  Speaker 4: So I love everything about what we've been able to do,
• 3:56
  Speaker 4: So I think it's extremely important. I think it's extremely
• 3:58
  Speaker 4: awesome and what we've been able to accomplish.
• 4:02
  Speaker 6: So talking about being naive to the space, A lot
• 4:04
  Speaker 6: of times when you're naive, you're extremely creative. And that's
• 4:09
  Speaker 6: something that fan base has stood on being creative in
• 4:11
  Speaker 6: a space because obviously we don't have the same capital.
• 4:13
  Speaker 6: And when I say way, i'm talking about the company
• 4:16
  Speaker 6: don't have the same capital as some of the big
• 4:17
  Speaker 6: players inside the space. But what happens when you see
• 4:20
  Speaker 6: your creativity being taken by a company or being implemented
• 4:24
  Speaker 6: by a larger company with more capital, how do you
• 4:27
  Speaker 6: guys combat that?
• 4:28
  Speaker 4: How do you deal with it? You know it's a strategy,
• 4:32
  Speaker 4: Well I don't. I have a belief that there's enough
• 4:35
  Speaker 4: room for everybody. Doesn't mean that fan base will well
• 4:38
  Speaker 4: just be you know, extinguished out of the market. But
• 4:42
  Speaker 4: I also think that every social media platform has a lifespan.
• 4:45
  Speaker 4: It will live, it will die, and so I look
• 4:49
  Speaker 4: at Facebook as a legacy platform. I look at Instagram
• 4:53
  Speaker 4: and TikTok and x now as middle aged platforms. So
• 4:56
  Speaker 4: there's always going to be another social media platform because
• 5:00
  Speaker 4: young people are always going to want to be involved
• 5:03
  Speaker 4: in platforms that their parents are not on. They want
• 5:05
  Speaker 4: to have their own communities, their own spaces, And so
• 5:08
  Speaker 4: I look at fan base as more as a success
• 5:11
  Speaker 4: or a future platform, as opposed to a platform that's
• 5:13
  Speaker 4: just ready to be the number one platform in the
• 5:16
  Speaker 4: world right now, but over the next five, six, seven years,
• 5:20
  Speaker 4: I think that'll be you know the case. I'm not
• 5:22
  Speaker 4: really worried because what I noticed it tells me a lot.
• 5:25
  Speaker 4: It tells me that I always look at black culture
• 5:28
  Speaker 4: and technology as kind of this relationship. It's like technology
• 5:32
  Speaker 4: tech companies put a bunch of legos on the table, right,
• 5:35
  Speaker 4: and then we come along and make the coolest shapes
• 5:37
  Speaker 4: of the coolest objects out of the legos that are presented,
• 5:40
  Speaker 4: and then these companies take those ideas and then implement
• 5:42
  Speaker 4: them into their business and then boom, you've got this
• 5:45
  Speaker 4: whole you know, entire you know, new technology that's been
• 5:50
  Speaker 4: invented or pioneered by us. So I think we'll always
• 5:53
  Speaker 4: innovate the space. I'm not worried about that. I'm used
• 5:56
  Speaker 4: to that. It's amazing as the plan go ahead.
• 6:01
  Speaker 3: Re stort, Well, I was going to ask you about
• 6:03
  Speaker 3: equity crowdfunding. I think that it's important people just to
• 6:06
  Speaker 3: have some level of understanding. So it's a way for
• 6:09
  Speaker 3: people to actually invest in a company. It's beneficial for
• 6:11
  Speaker 3: the companies because they can you know, get around the
• 6:14
  Speaker 3: VC world and they can raise you know, substantial amounts
• 6:17
  Speaker 3: of money. But from an educational standpoint, how do investors
• 6:21
  Speaker 3: actually get paid on this? Because I know it can
• 6:24
  Speaker 3: be difficult to receive you know, it's five hundred dollars.
• 6:27
  Speaker 3: It could be like, you know, ten thousand people that contribute, right,
• 6:31
  Speaker 3: So I think education is extremely important because when people
• 6:35
  Speaker 3: aren't fully educated and they don't see a return or
• 6:38
  Speaker 3: they don't know how to you know, get the money back, well,
• 6:42
  Speaker 3: then it turns into a scam. So that that's important
• 6:46
  Speaker 3: to fully educate people on the process of investing, what
• 6:52
  Speaker 3: the expectations are, how it.
• 6:55
  Speaker 6: This episode is brought to you by P and C Bank.
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• 8:46
  Speaker 1: An illegal alien from Guatemala charged with raping a child
• 8:49
  Speaker 1: in Massachusetts. An MS thirteen gang member from El Salvador
• 8:53
  Speaker 1: accused of murdering a Texas man of Venezuelan charged with
• 8:57
  Speaker 1: filming and selling child pornography in Michigan. These are just
• 9:01
  Speaker 1: some of the heinous migrant criminals caught because of President
• 9:05
  Speaker 1: Donald J. Trump's leadership. I'm Christy Noman, the United States
• 9:09
  Speaker 1: Secretary of Homeland Security. Under President Trump. Attempted illegal border
• 9:14
  Speaker 1: crossings are at the lowest levels ever recorded, and over
• 9:17
  Speaker 1: one hundred thousand illegal aliens have been arrested. If you
• 9:21
  Speaker 1: are here illegally, your next you will be fine nearly
• 9:25
  Speaker 1: one thousand dollars a day. Imprisoned and deported, you will
• 9:29
  Speaker 1: never return. But if you register using our CBP home
• 9:32
  Speaker 1: app and leave now, you could be allowed to return legally.
• 9:36
  Speaker 1: Do what's right. Leave now. Under President Trump America's laws,
• 9:41
  Speaker 1: border and families will.
• 9:43
  Speaker 2: Be protected sponsored by the United States Department of Homeland Security.
• 9:46
  Speaker 3: Works when they can get paid out. If they do
• 9:48
  Speaker 3: get paid out, the percentage like, can you just walk
• 9:51
  Speaker 3: us through that? Because, like I said, I think that
• 9:52
  Speaker 3: it's fully important. It's very important to educate people on
• 9:55
  Speaker 3: that because if not educated, then you know, other narratives
• 9:58
  Speaker 3: ought to be created.
• 10:00
  Speaker 4: Yeah, so, I mean, you guys cover both areas on
• 10:03
  Speaker 4: this show. But it's typically like pre ipo investing in
• 10:06
  Speaker 4: post ipo investing, So post IPOs when the companies on
• 10:10
  Speaker 4: the stock market, you can go buy shares NASDA, you
• 10:13
  Speaker 4: know what I'm saying, and invest in companies and do
• 10:16
  Speaker 4: stuff like that. Pre IPO investing is really a very
• 10:20
  Speaker 4: rarefied air that's really not available to most people because
• 10:24
  Speaker 4: of this rule called the accredited investor rule. And this
• 10:27
  Speaker 4: rule has been in effect since nineteen thirty three, which
• 10:29
  Speaker 4: means you have to have a networth of a million
• 10:31
  Speaker 4: dollars minus your house or make two hundred thousand dollars
• 10:34
  Speaker 4: a year for two consecutive years to even qualify to
• 10:38
  Speaker 4: invest in an early stage company. So when you think
• 10:40
  Speaker 4: about the Microsoft's, the Apples, the Ubers, the Ibms of
• 10:45
  Speaker 4: the world, they were all invested in by already rich people.
• 10:49
  Speaker 4: So it was rich people saying, hey, look, let's make
• 10:51
  Speaker 4: a rule so that we get the earliest access to
• 10:55
  Speaker 4: the best opportunities of investment. And then tell the general public,
• 10:58
  Speaker 4: we're protecting you by not risking your capital to invest
• 11:03
  Speaker 4: in these companies because you're an unsophisticated investor. We don't
• 11:06
  Speaker 4: want you to squander your life savings or your mortgage
• 11:09
  Speaker 4: or whatever it is you know to invest in these companies.
• 11:12
  Speaker 4: But I always say, no one has a problem with
• 11:15
  Speaker 4: us going to take our money and gamble five thousand
• 11:17
  Speaker 4: dollars ten thousand dollars on in Vegas, or go buy
• 11:23
  Speaker 4: lottery tickets five thousand dollars five hundred dollars worth of
• 11:26
  Speaker 4: lottery tickets. And so when you pre IPO invest in
• 11:30
  Speaker 4: the C stage companies such as Fan base. I always
• 11:33
  Speaker 4: say this, you are with us to the moon or
• 11:35
  Speaker 4: the ground, so you get along. You are along for
• 11:38
  Speaker 4: the ride, which every investor is, and there's not a
• 11:40
  Speaker 4: company out here. There are people that have invested in
• 11:43
  Speaker 4: startups that have gone unicorn and have gone bust. They
• 11:46
  Speaker 4: still take that same risk. The difference with equity crowdfunding
• 11:50
  Speaker 4: is that people are able to invest in small amounts.
• 11:53
  Speaker 4: Two hundred and fifty dollars five hundred dollars and I'm
• 11:55
  Speaker 4: not saying that's not a lot of money, but sometimes
• 11:57
  Speaker 4: there are minimums to invest in these other companies, these
• 12:00
  Speaker 4: these pre IPO companies, fifty thou twenty five thousand, ten
• 12:04
  Speaker 4: thousand dollars. That's a lot, five thousand dollars, that's a lot.
• 12:07
  Speaker 4: But to be able to say I can take two
• 12:09
  Speaker 4: hundred and fifty bucks, which is something that I would
• 12:11
  Speaker 4: spend on food or some shoes or some drinks at
• 12:14
  Speaker 4: the club and invest in an early stage company's kind
• 12:17
  Speaker 4: of a really big deal. And I think being able
• 12:19
  Speaker 4: to take advantage of this regulation is something that is
• 12:21
  Speaker 4: game changing for people. So I understand that people are
• 12:25
  Speaker 4: always concerned about scams, but that's why I think there's
• 12:27
  Speaker 4: limited it's called limited risk.
• 12:29
  Speaker 2: If limited risk is you're.
• 12:30
  Speaker 4: Investing two hundred fifty dollars, five hundred dollars, one thousand dollars,
• 12:33
  Speaker 4: there's risk involved, but it's not you risking one hundred thousand,
• 12:36
  Speaker 4: two hundred thousand, half a million dollars. And sometimes you
• 12:39
  Speaker 4: know people invest that in those those prec routes as well.
• 12:43
  Speaker 2: Yeah, that's a follow up to that.
• 12:44
  Speaker 6: So when we go into raising, how do what determines
• 12:48
  Speaker 6: the allocation that's going to be the amount raised? Right,
• 12:50
  Speaker 6: because we'll see companies or will hear it, they're trying
• 12:53
  Speaker 6: to raise two million, they're trying to raise five, ten, fifteen.
• 12:56
  Speaker 6: What are the factors that you determined to say, like
• 12:58
  Speaker 6: this is the amount that we need to raise? Is
• 13:01
  Speaker 6: it marketing? Like what are the things that go into
• 13:03
  Speaker 6: account when you're trying to raise a specific amount?
• 13:06
  Speaker 4: Well, for me, I put into perspective of equity versus valuation.
• 13:10
  Speaker 4: So if I would say, okay, I'm going to raise
• 13:13
  Speaker 4: my very first round I raised, I was going to
• 13:15
  Speaker 4: raise a million dollars at a twenty million dollar valuation, right,
• 13:18
  Speaker 4: So that's that's like two and a half percent of
• 13:22
  Speaker 4: the company or five percent, sorry, five percent of the company,
• 13:25
  Speaker 4: So it's not really a lot of equity to give
• 13:27
  Speaker 4: away for one million dollars. You know, to get five
• 13:30
  Speaker 4: percent of the company away at a twenty million dollar valuation.
• 13:33
  Speaker 4: So what you're typically looking to do for me is
• 13:36
  Speaker 4: raised funds needed to run the business. But also be
• 13:40
  Speaker 4: mindful of the equity that you're giving up in your business,
• 13:42
  Speaker 4: because a lot of times when you think about angel
• 13:45
  Speaker 4: investing or VC investing, especially when you don't have capital.
• 13:49
  Speaker 4: And I'll say this too, also, I bootstrapped fan base
• 13:52
  Speaker 4: in the beginning, so a lot of times tech startups
• 13:55
  Speaker 4: need that early early capital, that one hundred thousand, one
• 13:58
  Speaker 4: hundred and fifty thousand, ty thousand dollars to get started.
• 14:01
  Speaker 4: I spent two hundred thousand dollars of my own money,
• 14:04
  Speaker 4: so then I avoided giving up equity there, right, And
• 14:07
  Speaker 4: a lot of times that's where you get hit the hardest.
• 14:09
  Speaker 4: Those that first one hundred and fifty two hundred thousand
• 14:11
  Speaker 4: dollars might cost you ten to fifteen percent of your company,
• 14:13
  Speaker 4: depending on which angel investor, which route you take. So
• 14:16
  Speaker 4: I avoided giving away equity there. Then when it got
• 14:19
  Speaker 4: to the point where I needed to raise capital, I
• 14:21
  Speaker 4: saw the landscape and said, Okay, this looks like the
• 14:23
  Speaker 4: music business. To me, this looks like the vcs are
• 14:26
  Speaker 4: the record companies artists, and the Billboard charts and the
• 14:31
  Speaker 4: app store charts are very similar. So for me, I'm
• 14:34
  Speaker 4: trying to stay independent as long as I can to
• 14:37
  Speaker 4: put myself in a position to have leverage. So when
• 14:40
  Speaker 4: I'm valuing my company, I'm still going by the same
• 14:43
  Speaker 4: metrics that other companies have raised and set their valuation
• 14:46
  Speaker 4: that but I'm being mindful of not taking too much capital,
• 14:48
  Speaker 4: right because I don't want to say, Okay, fan base
• 14:50
  Speaker 4: right now is probably at this current round we just
• 14:53
  Speaker 4: did was value to eighty five million dollars, right, So
• 14:55
  Speaker 4: if I said, Okay, I'm going to raise thirty million
• 14:59
  Speaker 4: out of eighty five million out evaluation, that's like thirty
• 15:01
  Speaker 4: three percent of the company. I don't need that. I
• 15:03
  Speaker 4: don't need. I don't need that, you know, I don't
• 15:07
  Speaker 4: need that kind of stuff. So for me, I say,
• 15:11
  Speaker 4: let's keep the valuation low but enough to continue to
• 15:14
  Speaker 4: scale the company. Now we're getting into escape velocity zone
• 15:18
  Speaker 4: with fan base, where we need to raise large amounts
• 15:20
  Speaker 4: of capital to spend that capital faster to build our
• 15:24
  Speaker 4: team to build faster, better products, faster and move quicker.
• 15:27
  Speaker 4: So I think we've proven ourselves in this RecF space.
• 15:30
  Speaker 4: I think I'm done with the RECCF space. I think
• 15:33
  Speaker 4: I've mastered it and I'm pretty well versed in it.
• 15:35
  Speaker 4: But now we're moving into where we raise escape velocity capital,
• 15:39
  Speaker 4: and that's extremely important.
• 15:40
  Speaker 1: An illegal alien from Guatemala charged with raping a child
• 15:44
  Speaker 1: in Massachusetts. An MS thirteen gang member from El Salvador
• 15:48
  Speaker 1: accused of murdering a Texas man of Venezuelan charged with
• 15:52
  Speaker 1: filming and selling child pornography in Michigan. These are just
• 15:56
  Speaker 1: some of the heinous migrant criminals caught because of President
• 16:00
  Speaker 1: Donald J. Trump's leadership. I'm Christy nom the United States
• 16:03
  Speaker 1: Secretary of Homeland Security. Under President Trump, attempted illegal border
• 16:08
  Speaker 1: crossings are at the lowest levels ever recorded, and over
• 16:12
  Speaker 1: one hundred thousand illegal aliens have been arrested. If you
• 16:15
  Speaker 1: are here illegally, your next you will be fine nearly
• 16:19
  Speaker 1: one thousand dollars a day, imprisoned and deported, you will
• 16:23
  Speaker 1: never return. But if you register using our CBP home
• 16:27
  Speaker 1: app and leave now, you could be allowed to return legally.
• 16:30
  Speaker 1: Do what's right leave now. Under President Trump, America's laws,
• 16:35
  Speaker 1: border and families will be protected.
• 16:38
  Speaker 2: Sponsored by the United States Department of Homeland Security,