June 1, 2018

Arlan Hamilton 5: Control

by StartUp

The Story

In this week’s episode, Arlan tries to maintain control as investments fall through, she butts heads with a prominent investing platform, and we meet the Thelma to her Louise.


This is the fifth episode in a six-part series on Arlan Hamilton and her company, Backstage Capital.


The Facts:

Peter Leonard mixed the episode. 

Mark Phillips wrote and performed our original theme song. 

Build Buildings wrote and performed our special ad music.

Additional music by Peter Leonard, Blue Dot Sessions, Dream Junkies, and Bienart.


Transcript

AMY: Welcome to StartUp!

-music-

AMY: Before I met Arlan Hamilton, the words venture capital conjured up a pretty specific image: white guys driving Teslas through Palo Alto. And that’s not so far off. The world of VC is overwhelmingly white, wealthy, male. In pretty much every possible way, Arlan stands out. But this is the world Arlan chose to break into. I wondered how long she’s been willing - even relished being an outsider. 

Turns out, since she was a kid.

ARLAN: I was eccentric. I wore 6 watches in the third grade and they're all to a different time zone because I was just like obsessed with the fact that people in other places… had a different - like it was night time somewhere else, like that was crazy to me. So the Hawaii one looked had like palm trees on it, and then there's ones across the world. 

AMY: So three on each wrist.

ARLAN: Three on each wrist, yeah. I would not take back the six watches no matter how much. How much people didn't understand me? I really that was that was not for fashion. I wanted to be connected to people that were not in front of me.

AMY: At the time, I thought - oh that is so Arlan. The way her horizons have always been much bigger than whatever was directly in front of her.

-music-

AMY: But also… how stressful. Six times zones is a lot to keep track of - all those millions of people going to sleep or waking up or eating lunch. As an adult - Arlan kept scrupulous track of her own time. If a call was scheduled for 3PM, she was ready at 2:59. She didn’t like surprises. She needed be on top of what time things were happening, who was going to be there, what she could expect. 

-music-

AMY: Arlan liked being in control. The problem is, as the end of the year approached, some very big things were out of her control. The biggest one is that her mom needed surgery.  She had cancer. I knew I needed to ask Arlan about this, but I also knew this was a really sensitive topic. So, I was careful.

AMY: So your mom is sick...? 

ARLAN: You know what? I think what I want to do is call my mom. Because I'm not going to get too far into this without asking her if it's okay.

AMY: Arlan pulled out her phone, and walked out of the room. She needed to run this line of questioning by her mom. 

ARLAN: Hey, have to ask you a question. 

AMY: A few minutes later, she was back. 

ARLAN: Ok, she says I can talk to you about it, briefly. 

AMY: But there were terms.

ARLAN: She said 100 percent, and I’m saying this to you as well, she does not want to be contacted about it. If you bring this up to her at all, even nicely... cause I know you're very nice, we're done.

AMY: So I know this is everything about her current medical situation.

ARLAN: That’s correct. There is a chance she could bring it up. Do not bring it up. I’m not kidding when I say... because you're very good, so don't be good with her on this.

AMY: Arlan had always taken care of her mom. As an adult, she paid for her mom’s health insurance. This was a point of pride. When she’d been a kid, the whole family avoided doctors. They had no health insurance, so why find out something’s wrong if you can’t afford to do anything about it. 

So having money now - this was huge for Arlan. But all the money in the world couldn’t guarantee  that her mom would be ok. And right now… here were so many other things to focus on. At Backstage Capital - a big investment had just come in. The biggest one Arlan had ever received. And she and her investment partner, Christie Pitts were celebrating.

CHRISTIE: Whooo. Whooo! Frappuccino party! 

ARLAN:  So half of me. I'm super excited and the other half is like okay. Let's go. CHRISTIE: I know. 

AMY: This money came just in time. All of a sudden, the Backstage bank account was transformed. 

ARLAN: I look at this balance and it’s 500 thousand dollars.. That had been zero! Which is what I’m used to seeing. It’s, we get to begin, we get to start. That half million dollars would start a whole new company: Backstage Studio. The Studio would be sort of like an incubator for startups - with a focus on under represented founders.   

AMY: With 500 thousand dollars, Arlan could take most of the Backstage Capital staff and put them on the payroll of the brand new Backstage Studio. It was a simple solution to her most pressing problem: paying employees.

-music-

AMY: And, there was something else: a second big chunk of money. Arlan had been hunting down a different business deal and it seemed like it was about to through. 

ARLAN: So one more thing that’s really cool… and hopefully it happens. 

AMY: Arlan got on a conference call with her staff. This new deal had to do with a group called AngelList, which among other things, is a place for startups to raise money online.

ARLAN: This is confidential but it will come out pretty soon. What they're basically doing is putting together two and a half mil, to put 500K into a few funds on their site that are led by underrepresented, emerging managers, like myself and Christie. There are four that have been chosen out of the ones they’ve been talking to and we are the number one on the list...

AMY: Arlan explained that this money was coming from a few different venture funds organized through the AngelList platform. It would be half a million dollars that Backstage could use to invest in more startups. Arlan had been working toward this for months- because she already had 20 companies she wanted to invest in. She’d told them they were in what she called a “queue.” The queue was another of Arlan’s hacks - a way to engage with companies she was excited about, even when she didn’t have the money yet to invest in them. 


Some of these companies had been waiting for months. And now, and now she could finally tell them that money was on its way.


A week and a half later, the whole Backstage Capital team was getting together in Santa Monica. Christie was futzing with the computer.  


CHRISTIE: Does anyone want a copy of the agenda? 


ARLAN: Please say yes … 

CHRISTIE: One, two, three, four, five, six … 


AMY: The mood was festive - inaugural. They were here to talk about Studio. Almost everyone was wearing their purple Backstage Capital t-shirts. A woman named Amrit wore a matching purple rhinestone necklace. 


This new company - Backstage Studio -  and the paychecks of pretty much everyone at this table, were being funded by an investor from Portland, Oregon named Holly Levow. Arlan had never even met her. Holly believed so much in what Arlan was doing with underrepresented founders that she’d given her half a million dollars, sight unseen. But that was about to change. Because the mysterious Holly was planning to make an appearance later in the day. During a break at a restaurant across the street, I pulled Arlan aside. 


AMY: What do you think she’s going to be like? Do you have a sense of what her personality is like, what she looks like? 

ARLAN: I know that she’s blond, I’ve seen pictures. I know that she’s also Caucasian. She seems very friendly to people but also like homecoming queen. That’s what I get. I could be wrong. We’ll see. We’ll definitely see!

AMY: When Arlan and Christe and I got back from lunch, Holly and her husband Zach were waiting in the lobby.


ARLAN: so great to meet you. 


HOLLY: this is my husband Zach.


ARLAN: Hi Zach

AMY: Holly did look like a former homecoming queen. Early 40s., long blonde hair. French manicure, Kate spade purse. Arlan had reserved a room to meet with Holly, Zach and Christie. They didn’t want me in there. And then, the Levows had a flight to catch. 


But it was really important to Arlan that Holly meet her staff - she was proud of them - so she rushed everyone down to the lobby to catch Holly before she took off. 


KAZIAH: Hi I’m Kaziah


HOLLY: Kaz…


KAZIAH: Kaziah


HOLLY: Kaziah, nice to meet you…


HOLLY: A-mur-rit. Nice to meet you, I’m Holly. 

AMY: Holly made a polite joke about being quizzed on people's’ names. Then, with a smile and wave, she was off. 


AMY: Later,  Arlan told me what she and Holly had talked about, during that meeting. Holly told her she was already getting a return on her investment. Just having Arlan and her staffers in a room together, strategizing about ways to support underrepresented founders? That counted as a return too. She didn't need money to feel like she'd invested in the right place.


That night, I stayed in an airbnb near Arlan’s apartment in West Hollywood. The plan was that she’d pick me up on the way to the airport, and we’d fly back to San Francisco together. But when I woke up, there was message from Arlan.  Let’s meet at the airport. You can ride with me another time.


A couple minutes later, she sent another text. She was throwing me a bone. “I definitely cried this morning, so you can ask me about that at the airport if you’d like.”

It’s true - Arlan never cried with me. She didn’t do a ton of emoting at all, really, which had become a running joke between us. I was always asking Arlan these how - does that feel questions. She’d give me some flat, pragmatic answer, as if nothing ever rattled her.


But this morning.. something clearly had. I got to the airport a little after 9. By the time I got to the gate, Arlan was already there. She wasn’t crying anymore. She seemed just generally kind of depleted.

 

ARLAN: I don’t know where to start. Do you want to know about my morning?


AMY: Yeah, what happened this morning?


ARLAN: Um... so…


AMY: I could tell right away that it was bad news. The 500 thousand dollars Arlan thought was coming through AngelList… wasn’t happening after all. Which meant now she couldn’t invest in the queue companies. Arlan had thought she had this under control. And now - suddenly - she didn’t. 


ARLAN: It had happened. They said it. They said it. I’ll tell you what they said. We’re going to be doing 500K into several managers, starting with four. And you are one of the four. And this will happen at the beginning of January. 


ARLAN: I believed that. Now what they’re saying is, after some shady silence in my opinion. Is that I was mistaken. That they did not mean to imply that. I can read you the emails. They didn’t mean to imply I was getting it. They meant to imply that I was in line. That I was up for it. That I was still a guess. 


AMY: Later, we got in touch with AngelList for their side of all of this. They said they weren’t sure how their and Arlan’s expectations became mismatched, but they felt like they’d been clear. 


From Arlan’s perspective, she had been wronged. She and I took our seats on the plane. And the frustration with AngelList just kept spooling out of her.  


ARLAN: It was, it was set up! You know, it was always we’re aiming toward this, and then when we had it, it was ok it is, it’s confirmed. We’re gonna do it in January. We didn’t know the date … 


-music-


AMY: Verbal commitments fall through all the time in VC - and Arlan knew that. Usually she waited until she had something in writing. But in this case, she felt she’d been given a firm yes. She was so sure, she had sent out triumphant emails about it. She told the other investors in her fund that a big new investment was imminent. 


Now she had to write everyone and say it wasn’t happening. And if she did that? Maybe someone would step up to help. 


ARLAN: If you’ve spent 35 years doing it yourself and there not being that much help … You know, and then all of a sudden it’s like ... I don’t know I’m just thinking about it. I don’t have an answer yet. 


AMY: What are the consequences? What worries you about that?


ARLAN: You don’t go to the well so often. If I waited 2 or 3 days maybe a solution would happen, bc sometimes that happens. And what if there’s something else I need help with later? Can’t go back to same people. And it’s not their responsibility, it’s mine. This is not how Arlan wanted to raise money. Because now she was in a pinch. This came uncomfortably close to asking for help. 

 

ARLAN: I don’t want to push panic button every time I feel panic! Because if I did i’d be pushing that button a lot! 


FLIGHT ATTENDANT: Do take care when opening those overhead bins and welcome to San Francisco. 


AMY: The big event of the day was going to be a taping for a video podcast hosted by a well known venture capitalist named Jason Calacanis. This was a big platform - Arlan knew that whatever she said on Calacanis’s podcast was gonna make the rounds. Other VCs would hear it. 


JASON: Hey everybody, welcome to another episode of Angel, the podcast where we talk to angel investors who are investing in the next crop of great startups. My guest today is Arlan Hamilton and she is with Backstage Capital <<fade under>>


The interview begins and not even ten minutes into it - what does Jason Calacanis bring up, but AngelList. 

 

ARLAN: Funny you should ask, Jason … um… 


AMY: That um? This is a very pregnant um. It’s the sound of Arlan making a calculation. She had a couple of options here. She could do the politic thing. Decide not to burn bridges. Resolve the misunderstanding in private. 


Or, she could say how she really felt. Which is what she did. 


ARLAN: AngelList. (yeah) Good for some people … not so good for others. I am others.


JASON: Got it. Did you use it ever, has it worked?


ARLAN: I tried, I tried Jason … but man, they really screwed me over. In a big way.  


-music- 


AMY: It was official. Arlan was taking her beef with AngelList public. She already had a reputation for this kind of thing - mostly Twitter spats, sometimes with big players in the world of VC.  


But now, Arlan was burning the bridge to a well-connected Silicon Valley institution, a conduit to millions of dollars. And she knew that. But she didn’t seem to care. 


I got the sense that this wasn’t even about AngelList anymore. AngelList was the last straw. 

As we drove through San Francisco … Arlan was beginning to sound disillusioned with the whole world of venture capital …  in general

 

AMY: what do you mean you’re not so sure about this VC part?


ARLAN: Like uh… the VC world is not a very inviting place. I didn’t think it was going to be like a camp or something where everyone was hugging. 


AMY: Summer camp.


ARLAN: Yeah, summer camp It kind of sucks here. And I think that there are a lot of people who would be happy if I got frustrated enough to leave. I’m so much more jaded than I was before. 


-music-


AMY: Before, when Arlan looked at problems in Venture capital - the way it ignored minority founders, missed out on so many markets - this used to animate her. It got her fired up, because she saw these problems as opportunity for herself. That’s what had brought her to Silicon Valley. That’s why she slept at the airport. But now - Arlan didn’t sound fired up anymore. 


ARLAN: Like I just see these guys, who are in their offices that they have these 100, 200 500 million funds. Fake power they think they have. And all that happens while I have to beg for 25K at a time. It’s tough. Sometimes it’s really tough.


AMY: Just two days later … Arlan’s mom, Mrs. Simms, went to the hospital for her cancer surgery. Arlan flew to Houston to be there with her. She didn’t want her mom to be alone at any point, so she’d also flown in her mom’s sisters and Arlan’s brother to keep Mrs. Simms company. The night of the surgery, Arlan stayed at the hospital. The next morning, she and her brother Alfred, were waiting to find out when their mom would be released. Arlan sounded exhausted.

ARLAN: I don’t know. Like 6 or 7 hours. Cause I don’t know … She might be leaving in like 2 hours. I told her to call me. 

AMY: This whole situation was just a lot. Whenever Arlan wasn’t with her mom in the hospital, she was back in her hotel room. She had to figure out how to get money to the queue companies as quickly as possible.

ARLAN: It's really important that I don't freak out right now because that's when I'll start making mistakes and making like burning bridges and not being very strategic, so I'm trying to be as. I'm trying to look at this like it's a little bit of a gift that it's happening right now because I just spent the last 48 hours looking my mother's mortality in the face, Helps to put things into perspective. 

-music-


AMY: When Mrs. Simms was discharged, Arlan sent her other family members home. She moved her mom to a hotel in downtown Houston. Arlan got a room right across the hall, so she could keep an eye on her. 


And after a while she sent me a text. She said her mom was feeling better. And that if I wanted to? I could finally meet her. A week later, I was on a plane to Houston. 


After the break: I finally meet Mrs. Simms 


-music-


AMY: When Arlan was growing up, she and her mom thought of themselves as Thelma and Louise. They watched all the same TV shows - General Hospital, Friends. Arlan would tease her mom about the movie stars Mrs. Simms loved  - Sandra Bullock, Jennifer Aniston. Mrs. Simms referred to both of them interchangeably as “that little girl.”


Even Interlude magazine - the music magazine Arlan launched back in the early 2000s - had a column in almost every issue consisting of a verbatim transcript of Arlan and her mom. 


SHANA: Mama. Also, Paris Hilton’s dog ... Arlan laughs, what about him? This is Shana Brenion, Arlan’s old roommate, reading the column.


SHANA: I heard a rumor, I don’t know how true it is - that she’s getting rid of this dog. Chihuahuas aren’t the kind of thing that can survive on their own. So when you get tired of a chihuahua where does it go? You can’t just leave it out on the street because it’s endangered. Arlan: I don’t think that’s the word for it. They’re not endangered if there’s too many of them. Mama: They’re endangered of being killed!


AMY: Arlan teased her mom, but she also loved to spoil her. Just before Mrs. Simms’ surgery, Arlan had flown her to New York - bought her 5th row seats for Hello Dolly on broadway.  


And during Mrs. Simms recovery, Arlan had set her up in a room overlooking downtown Houston. Arlan was staying right across the hall. I went to her room first. 


ARLAN: She’s a very lovely woman. Don’t let me scare you. She’s very sweet. 


ARLAN: She’s also.. She’ll do a lot of sussing you out at first. I would do a lot of “how does that make you feel” stuff rather than telling her how it makes her feel.


AMY: Any other tips? Don’t swear.


ARLAN: Yeah. this is just for you! You can swear but for the rest of her life … she will just have an opinion of you. And I just don’t want that for you. Across the hall Mrs. Simms was on a sofa watching TV. 


MRS. SIMMS: Come in hi. 


AMY: Hello! Hi Mrs. Simms, I’m Amy.


AMY: I sat down next to her, and Arlan pulled a chair up to face us. 


ARLAN: So here’s the rules …


AMY: At first, she had said she’d only stay for a second, but she sat there for an hour, scrolling through emails on her phone - I couldn’t tell whether it was to keep an eye on me, or to make sure her mom didn’t say anything embarrassing. 


I pulled up a photo from the 1980s - Arlan, Alfred and Mrs. Simms at one of those photo studio places. 


AMY: Describe Arlan in this picture, what do you see when you look at her? 


MRS. SIMMS: Someone in charge you see how she's holding uh my arm like she you know she's in charge and Alfred’s smiling because he loves the camera, and I'm just staring like hmm. 


AMY: Arlan being in charge - this seemed to be a theme in Arlan’s childhood. 


MRS. SIMMS: We reversed roles when she was seven. And it's been that way ever since. you know. 


AMY: What happened when she was seven? 


MRS. SIMMS: I think it was a belt in the store. You know how sometimes she you go into a store everybody's all over you. But some stores like maybe a Neiman Marcus or whatever, they're like you shouldn't really be in here?


AMY: Mrs. Simms wanted to see a belt. And the saleswomen were ignoring her. Arlan wasn’t having it.  


MRS. SIMMS: She goes, “my mother wants to see those belt so will you …” You know so she started whatever and so she's been doing it ever since so I decided well, that's a good way to get to see the belts. Let's try that with something else. So she does. 


AMY: So Arlan took over. She became an adult - sometimes the  adult in her family. 


This meant worrying about money. Arlan worried about her mom’s debt to payday lenders and pawn shops. She worried about the rent. When she was 16, she told me, she took a bunch of pills left over from a dental surgery her brother had had. She said she was just wanted help, for someone to see her. The school nurse sent her to a therapist. But when Arlan realized how much it would cost, she never went back.   


Arlan couldn’t fix her family’s poverty. That she couldn’t control. But she could protect her mom from having to confront how much poverty affected their lives.


In the hotel room that day, Mrs. Simms told me a story about a school called Hockaday - a prestigious all girls private school in Dallas. She said when Arlan was a teenager, she was offered a scholarship at Hockaday. So the two of them went to visit.  


MRS. SIMMS: So we're going to visit Hockaday because they want her at Hockaday and so we visited and it was so nice. It was part of affiliated with the country club, and she'll go to all of the events. It was just the place to go. 


AMY: But then, on this tour of Hockaday? Arlan noticed something. 


MRS SIMMS: They’re all dressed alike. She said, “they’re wearing uniforms. and she says I'm not going here. I'm not gonna wear a uniform, and I said you're not gonna go? She said I'm not wearing a uniform. Okay. so she didn't go to Hockaday. 


AMY: I had heard this story before. From Arlan. Except when Arlan told it, she gave a totally different reason for not going to Hockaday. 


In Arlan’s telling, as a teenager, she had made a very adult calculation. She knew that even with the scholarship, her family wouldn’t be able to afford Hockaday - the supplies and trips and social events. Mrs. Simms didn’t see that. But Arlan did. 


ARLAN: it was just: this is nice and all, but how are we going to afford this and how are we going to afford the things that are outside of this? It was never an option to me, it just didn’t seem like an option to me. 


AMY: What's it like for you to hear that now? 

MRS. SIMMS: Well, in retrospect, I don't think she would have liked Hockaday. 

ARLAN: I would have burned that place to the ground. Not literally, but it would have been um ... I don't think I would have done well at Hockaday.

AMY: I'm trying to picture you at a cotillion.

ARLAN: Please don’t try to do.

-music- 

AMY: Arlan’s senior year of high school was the hardest year her family had faced. Mrs. Simms was laid off from her job, and the family got evicted. For a while they all shared a bed in a motel, but eventually they couldn’t afford that either, so Arlan and Alfred dropped out of school and the three of them went to stay with relatives in Mississippi.  

Arlan once told me that having money equals having control. Because when you’re poor, like she and her mom and brother were, you have no control over your life - you can’t control where you live, or whether you can go to the doctor. And there’s just no dignity in that. 

-music-

AMY: This idea of dignity and money - I didn’t realize how central this was to Arlan until a story she told me,  about the time they were living in the motel... and Arlan didn’t want anyone at school to know. 

ARLAN: So I was on the program at school where you got a free lunch. You know this school a lot of people were.. had wealthy families at the school I went to. And one day in school they made an announcement on the intercom and it was like right before Thanksgiving. They gave this list they said the following people need to come to the auditorium. And my name is listed. They said you've won, you've won a Thanksgiving meal. And the reason that it makes me emotional is because of the dignity that they gave us. 

ARLAN: Because they didn’t say you... they did say that you need this and you can't afford it, they said that you won a contest. So we go to the auditorium when we each have a bag and it has all this food in it. And I can now take this back to my family. And I knew that nobody knew that we were secretly living like that. And so it just gave me a little extra hope. Speaking of food… 

AMY: When she told me this story, Arlan was in the studio at Gimlet, and I was on the phone. This was the only time Arlan had ever cried with me. I think it caught both of us by surprise. She opened a snack bar that had been sitting on the table. 


AMY: Do you want to take a break and eat that? 

ARLAN: Okay yeah I'll take a break and eat it.


ARLAN And can we ... I know you want to talk about a lot but can we, can we not spend too much time on it?


AMY: sure why not?


ARLAN: It's a little bit like what's a little bit like you know showing the videos of flies around kids in Africa when you don't show anything else. That's what it is and I know you're not doing that. I know you're painting this very big, different picture of me and I'm very proud of that and happy about that. But in this moment, yes. It feels like a fetish thing every once in a while not just with you, but with white people in general because they want to feel like they're...they want to feel like they're helping someone, and that sometimes that's not how the real deal is. You know like these are sad circumstances that I went through, but I'm not a sad person.


-music- 


AMY: Later, it struck me: When Arlan decided to become a venture capitalist - she picked the ideal career to turn the tables on this whole dynamic of white-person charity.


As a VC, Arlan was the one giving out money. And she was giving it people who reminded her in some way, of herself - women, people of color, LGBT founders. Not as a handout, but so that they TOO could go out and get rich. That’s what this whole thing was about. Making it so that not only the white guys got a shot at making a fortune in Silicon Valley. The day after my conversation with Mrs. Simms, Arlan and I caught a flight from Houston back to Oakland, where she had a day of meetings. And while we were waiting in a hotel lobby, Arlan casually informed me that she had just found a solution to the problem of her queue companies.


An investor had just given her 250K for her fund. Backstage could finally make its investments. 


AMY: You just got a commitment of 250 grand from an LP?! 


ARLAN: I did, so I have to respond to them and thank them and tell them, yes we will take that offer.

AMY: It sounds like there’s a caveat …? 


ARLAN: There really isn’t. I’m so road weary. It’s been three solid years of these ups and downs. It would be a good thing for me to just take today and sit with that and acknowledge that, but it’s hard for me to do.

 

AMY: Pretty soon, I found out who the investor was. 


The new mystery investor was the old mystery investor. It was Holly Levow, who had swept through the office in Santa Monica a few weeks before. Holly was already by far the largest investor in Backstage - and now she was coming in with another quarter of a million dollars. This was exponentially more than any other investor. In February, Producer Lauren Silverman took a trip to Portland, Oregon, to visit Holly at home. Holly’s house - it turned out - looked surprisingly normal, for someone who’d just made an 750 thousand dollar investment. Tiny lawn, a kid’s scooter on the porch. The only signs of wealth were a Tesla in the driveway and a fancy doorbell. 

 

LAUREN: Hi! Are you Holly?   


AMY: Holly told Lauren she didn’t need much convincing to invest in Arlan. 


HOLLY: I invested based on the concept and speaking with her on the phone. 

LAUREN: So just a phone call yes. Yes.

LAUREN: Had you ever done that before? 

HOLLY: No, not to that extent no, haha.


AMY: Holly and her husband were already wealthy - he was a founder and she had been an employee at a company that had gone public. In recent years the two of them had made big donations to local nonprofits around portland, women’s organizations. 

In other words, Holly was mostly a philanthropist - which made her different from the other investors Arlan had been courting. Arlan’s pitch was that investing in Backstage was a way to make money. But Holly’s primary interest wasn’t really money at all. It was about helping underestimated founders.  

HOLLY: It's about supporting an idea. And creating proof of concept, and I know that this will succeed and will hopefully have that ripple effect, where people realize that it’s not as much of a risk to invest in women entrepreneurs as they think it might be. 


In the past, I think Arlan might have turned up her nose at this kind of investment.

 

-music-


AMY: But her thinking on this had changed. She knew that on average, it takes a company 7-10 years to start generating big returns for its investors. Holly had just bought Arlan some time. 


And even if the money hadn’t come in yet, Arlan realized that Backstage Capital WAS generating returns - just a different kind. 


ARLAN: It is an impact when a black woman comes up to me in a small town and tells me that she started a company because she heard about BC. And she knows that in 2 years we’ll be there for her. That’s impactful. 

Just a few short years ago Arlan thought all you needed was hustle, and a good nose for sniffing out companies. She’d come out to California on that promise. Slept on the floor of the airport.

But it turned out she needed something else too - time. And now… she had a little more.


-music-


AMY: Coming up … the final episode in our series!! We meet the companies who have been waiting, for months, for an investment from Backstage Capital. And, Arlan makes headlines

 

ARLAN: Is it okay if I go rogue a little bit? And Backstage crew I’m going to go a bit rogue too. I’m about to make an announcement that I hadn’t planned on making…


AMY: That’s coming up next week.

In June, Arlan and I will be speaking together at GimletFest in Brooklyn. She’ll be talking about what it was like to followed around by the StartUp from NPR’s podcast Code Switch will be moderating the conversation. Get your tickets at gimletfest.com. Also at GimletFest, hosts from Heavyweight, The Nod, The Habitat and more! Check it out - GimletFest.com. 


Also, If you’re liking this season and want to go deeper, sign up for StartUp’s newsletter. You’ll get Q&As with Backstage portfolio companies that you don’t hear in the podcast, and a look at Arlan’s side hustles before she was a VC. Look for the link in the show notes - or go to gimletmedia.com/newsletter, where you can sign up. 


Today’s episode was produced by Bruce Wallace, Simone Polanen, Luke Malone and Angelina Mosher. Our senior producer is Lauren Silverman. Editing by Annie-Rose Strasser, Molly Messick, Lisa Chow, Heather Rodgers, Lulu Miller and Sara Sarasohn. Peter Leonard mixed the episode.


Special thanks to Lissa Soep and to Sunil Rajaraman who has a podcast called “This Is Your Life In Silicon Valley.” I’m Amy Standen. Our theme song is by Mark Phillips, remixed by Bobby Lord. Build Buildings wrote and performed our special ad music. For full music credits, visit our website, GimletMedia.com/startup. Find out more about the show at gimletmedia.com. You can follow us on Twitter @podcaststartup. Thanks, we’ll see you next week.