What happens when entrepreneurs stop being polite, and start getting funded?
It’s pretty weird to see your profession turned into entertainment, particularly when the average board meeting is about as entertaining as watching paint dry. But I am definitely intrigued by collisions between pop culture and venture capital.
For example, there have been a recent parade of reality TV shows where entrepreneurs pitch their deals to panels of venture capitalists and wealthy angel investors, such as American Inventor, Shark Tank, Dragon’s Den and Money Tigers. Then there is the influx of celebrity venture capitalists, like Bono, Ashton Kutcher, Joe Montana and Ronnie Lott.
Some of these celebrities have shown a propensity to be particularly entrepreneurial, so it’s not so surprising to see them enter the more structured world of finance. Many celebrities have created major international businesses around the product that is their own persona, so why not diversify? You can only buy so many Lamborghinis and Italian villas with all that cash...
However, I was surprised to hear that the newest celebrity entrant to my field is... MC Hammer. Yes, the parachute pant-wearing dude we all remember from the days when Vanilla Ice ruled the airwaves. Hammer, who at least does live in Silicon Valley, has apparently been out there building an entrepreneurial empire out of the dust that was his once-successful music career.
Unfortunately, he declared bankruptcy in 1996, losing a vast fortune through poor financial management (irony alert). But like any real entrepreneur (the guy did sell 50 million records after all), he apparently picked himself up, declared himself "2 Legit 2 Quit" and started to rebuild through producing other musicians and angel investing in a variety of tech and music start-ups.
This week, Hammer announced that he is joining up as an investor/mentor in a new technology company incubator. Really, I swear. According to VentureWire:
“Hammer, whose real name is Stanley Burrell, is lending advice to minority entrepreneurs in the New Media Entrepreneurship, or NewMe, accelerator program in Silicon Valley this summer. Starting June 16, seven minority-led start-ups from across the country will live in a rented house in Mountain View, Calif., and can work there or in a shared space in San Francisco. Additional Bay Area start-ups will also be invited to participate, but will not live in the house.”
According to reports, a variety of “real” venture capitalists and technorati have signed on to support the NewMe venture, including Brad Feld of Foundry Group and Charles Hudson of SoftTech VC, plus executives from companies like Foursquare and Twitter. Apparently these guys will participate as advisors in a 9-week summer program to provide guidance to the would-be entrepreneurs that are kicking it in MC Hammer’s living room.
As crazy as it sounds to combine the tenets of reality television with venture capital and entrepreneurship, it is great to see a program that is truly focused on engaging the minority and female entrepreneurial community in this way. There are even three bona fide females among the board of mentors, representing the obligatory <15% (and not a percentage point more) of chicks allowed to gather in any private equity discussion. From the NewMe website, it appears that 5 of the 7 participating companies have already been selected and 2 of them have female founder/CEOs, so that is great. In keeping with the true roots of the reality-TV-like movement, the remaining two companies will be selected through a vote of the “community." Gotta love it.
I will be very curious to see how this program plays out and whether real companies can emerge from MC Hammer University on their way to becoming next year’s Pandora or Living Social or Facebook. It would be fantastic if NewMe were the beginning of something that inspires new ideas and brings fresh new blood to the field, because every industry can benefit from a new way of doing things.
With the VC field undergoing a major transition of its own and early-stage companies finding it harder than ever to find seed capital and the mentorship that often accompanies it, anything that fosters innovation and marries it with capital is a good thing for our industry and our country. I sincerely hope that after 9 weeks of co-habitating, the last thing these entrepreneurs will hear is MC Hammer’s follow-up hit, “Can’t Fund This.”
Lisa Suennen is a co-founder and Managing Member of Psilos Group, a healthcare-focused venture capital firm with over $577 million under management.