BLCK VC Launches Scout Program With Lightspeed, Sequoia To Support More Black Investors

BLCK VC Launches Scout Program With Lightspeed, Sequoia To Support More Black Investors

For all the high-speed growth and innovation that venture capital is supposed to fuel, the industry itself isn’t structured for quick change. BLCK VC co-founder Sydney Sykes knows it first-hand. Since last summer, firms have reached out to Sykes for advice on changes they can make fast.

Increasingly, her answer has been a program growing in popularity in VC: the scout. “Firms will hire a partner once or twice a year max, or an investment professional. But scout programs can be as large as you want,” Sykes says. “This seems like a really obvious solution to get more dollars in the hands of Black investors.”

Today, BLCK VC is launching a new program to help firms do that, with two of VC’s big-name firms signed on as partners: Lightspeed Venture Partners and Sequoia. Called The BLCK VC Scout Network, the program will work with up to 20 scouts over a six month period, twice a year. Lightspeed and Sequoia are signed on to sponsor the program’s informational sessions, meetings and events as its partners for the next two years.

BLCK VC defines a scout as someone who receives compensation – either cash or carried interest – to source or invest in startups on behalf of a VC firm. Scouts are typically entrepreneurs or tech executives themselves with an interest in angel investing, but Sykes says the program will consider candidates actively looking to do so who haven’t started yet (with a preference for those who have graduated from another BLCK VC training program, the Black Venture Institute.)

Both firms had proactively reached out to Sykes and BLCK VC following the death of George Floyd, Sykes says. Following conversations between Lightspeed partner Mercedes Bent and the group, Lightspeed announced it was shifting the focus of its program to prioritize working with scouts of under-represented backgrounds last year. Bent and firm co-sponsor Barry Eggers, a founding partner at Lightspeed, brought on 42 such scouts, most of them outside the Bay Area. Past graduates of its program include Sykes and BLCK VC co-founder Frederik Groce’s fellow Forbes Under 30 alumni Ivan Alo and LaDante McMillon of New Age Capital and Cake Ventures founding partner Monique Woodard.

Sequoia, meanwhile, helped popularize the scout role more than a decade ago, launching its program in 2009, and has invested in more than 1,100 startups through its scouts, including Stripe, Faire and Uber. “The beauty of the model is that when you focus on empowering folks, upskilling them and making sure they have the right expertise, that ends up benefitting the firms as well,” says Nmachi Jidenma, who joined Sequoia as senior director of scouts and partnerships earlier this year after leading channel strategy at WhatsApp, and who is representing Sequoia in the new program alongside partner Mike Vernal.

Sequoia and Lightspeed, of course, are for-profit businesses. With most scout participants expected to be affiliated with other VC firms, neither says they’re in it to poach talent or deal flow from the competition. But supporting the program financially and through their partners’ time is good business, they say. “There’s a multiplier effect,” says Lightspeed’s Bent. “We’re big believers in the idea that more diverse perspectives and life experiences lead you to opportunities you might not find otherwise.”

The BLCK VC Scout Network is taking open applications through the end of day on May 23, Sykes says, at a dedicated website. The program itself is expected to start with a four-week intensive course of virtual sessions in mid-June; starting in July, the group will then spend five months meeting occasionally in smaller groups. Its organizers hope to have an in-person final event in November, if it’s safe to do so.

At BLCK VC, Sykes says she’s not expecting every participant to turn venture capitalist themselves. But if some scouts show a knack and end up leaders at existing firms or launching their own, that would be an exciting secondary outcome for the program, she says. “It’s no secret that I want to increase the number of black investors, and scouting helps with that,” says Sykes. “But encouraging generational wealth-building through investing, and building up a network in the tech community, that’s going to be beneficial regardless.”

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