Unlocking the Hidden Gems: Recognizing the Untapped Potential of underestimated Founders
In a bold move challenging the traditional venture capital landscape, Gayle Jennings O'Byrne, CEO of Wocstar Capital and co-founder of the Wocstar Fund, is breaking barriers by nurturing underestimated entrepreneurs, primarily women and individuals of color. Despite initial skepticism and funding difficulties, Wocstar's unique approach, combining financial backing with hands-on assistance and commitment to diversity, has already proven fruitful with the successful acquisition of portfolio company Audigent by Experian. This early triumph validates Wocstar's investment thesis and underscores the untapped potential hidden in overlooked founders.
Venturing Beyond the Norm
Far from the usual venture capital fund, Wocstar Capital's origins trace back to Gayle Jennings' tech and Wall Street background, coupled with her personal cancer survival experience. Driven by a sense of urgency to make a positive impact, Jennings initially embarked on a 'listening tour' to connect with diverse founders and investors, uncovering the struggle of securing substantial investments for underrepresented entrepreneurs while spotting eagerness from investors to champion high-potential, diverse businesses.
Based on these discoveries, Wocstar constructed its investment thesis centered around three core elements:
- Influence: Capitalizing on women's remarkable power over purchasing decisions, Wocstar invests in businesses tackling issues within the consumption sphere, such as retail tech, media, and entertainment.
- Resources: This pillar zeroes in on companies that contribute to resource provision, like clean energy, agriculture, and supply chain solutions.
- Transactions: The final foundation focuses on facilitating consumption through financial and operational technology, including FinTech solutions.
Early backers of Wocstar were primarily wealthy individuals and family offices, later joined by institutional giants like JP Morgan. Taking accountability for her investors' wealth extends beyond a fiduciary duty for Jennings, who sees her role as a personal commitment to ensuring socially and financially beneficial returns.
Valerie Mosley, founder and chief visionary officer of BrightUp, adds, "I'm incredibly proud of Wocstar's team and the returns and success they are delivering to investors like myself."
Navigating the Challenges
From securing funding to overcoming obstacles related to smaller check sizes, Wocstar Capital faced numerous hurdles as it strived to elevate underserved founders. Skepticism from investors, despite their declared commitment to diversity and inclusion, was a significant issue, although Wocstar surmounted it through strong performance and successful exits, proving its approach viable.
"Investors want to see the economics," explains Jennings, "not the impact message with the diversity."
Besides this, the limited scope of Wocstar's initial investments provided another challenge. She addressed this discrepancy by underselling Wocstar as an alternative to larger funds with substantial checks, focusing on the extensive assistance, connectivity, and advocacy offered to portfolio companies.
Preferring to remain an unobtrusive presence instead of taking on the role of a board member, Jennings seeks to foster a safe, open environment for founders, allowing them to express vulnerabilities without fear of judgment.
Pivotal Exit Shines Light on Diverse Founders' Potential
Gayle Jennings crossed paths with Audigent co-founder Jon Gosier through mutual acquaintances in Atlanta. Gosier's social media analysis company later welcomed Drew Stein, Brian Brater, and Shelton Mercer to its team following their initial fundraising rounds. After Gosier vacated his CEO position and switched to venture capital, Stein stepped in as leader.
Although Audigent didn't have a female founder, Wocstar's commitment to supporting strong female leadership and commitment to diversity led it to invest in the company. "We're female-forward," says Jennings. "We want to invest in really great companies that recognize the competitive advantage of having women in leadership."
Audigent's performance since has been noteworthy. Experian recognized its data activation and identity platform as an essential driver of growth in advertising, leading to the company's acquisition, offering Wocstar a profitable exit and validation of its investment strategy.
This exit holds particular significance for Wocstar as it sheds light on the substantial potential of investing in underrepresented founders. By unlocking this hidden potency, Wocstar's triumph paves the way for a more inclusive and transformative venture capital sector.
Beyond its financial rewards, Audigent's acquisition underscores the considerable economic potential lost through underinvestment in underestimated founders. Wocstar's achievement emphasizes the chance to unlock this untapped potential and contribute to economic growth.
Wocstar Capital's success in encouraging wealth formation for its investors – many of whom were new to this asset class – highlights the importance of its mission. The success of Wocstar's inaugural fund hints at a bright future for the fund and serves as a compelling inspiration for other investors to adopt a similar approach.
Wocstar Capital's victory with Audigent's acquisition exemplifies the profitability of investing in underestimated founders and forges a path towards a more inclusive and impactful venture capital ecosystem. By challenging conventional investment norms and emphasizing both financial yields and social responsibility, Wocstar fosters innovation and helps drive positive change.
Wocstar Capital's investment in Audigent, despite the company not having a female founder, demonstrates the fund's commitment to supporting strong female leadership and diverse founders. This investment strategy, focused on underestimated founders, led to a successful acquisition by Experian, proving the untapped potential in this often-overlooked group.
This success in backing underserved founders, such as Gayle Jennings O'Byrne's decision to nurture women and individuals of color in entrepreneurship, can inspire a shift towards a more diverse and inclusive venture capital landscape. Venture capital firms could potentially unlock significant economic potential and contribute to economic growth by investing in underestimated founders, like Wocstar has demonstrated.
