Having a hard time raising money from investors? Here’s an alternative approach that may be worth trying: try pitching to your peers.
Village Capital (or “VilCap” for short) is accepting applications for its Education US 2016 “venture development” program, organized in collaboration with AT&T through the AT&T Aspire initiative. Twelve companies will be chosen for a three-month program that comes with the usual splash of mentorship and business networking. At the end, the two “top” companies will each receive a $75,000 investment from its affiliated venture fund, VilCap Investments.
But here’s the twist: Instead of pitching in front of VilCap’s team of investors or a panel third-party judges, participating entrepreneurs vote among themselves who should get the money.
It’s an approach that “levels out the playing field in terms of who gets funded,” Nasir Qadree, VilCap’s Sector Manager for Education, tells EdSurge. He says the peer-voting process, based on these six criteria, supports a more “diverse and inclusive pipeline of entrepreneurs,” particularly in regards to women and minorities.
His supporting evidence: more than 30 percent of VilCap’s portfolio companies have a female on the founding team. Twenty percent are led by entrepreneurs of color. That’s a marked difference from how traditional venture firms pick their investments (only eight percent go to teams with women co-founders).
Applications close soon, on April 22. There’s no cost to apply, although entrepreneurs should be prepared to articulate a solution to bridging the skills gap between education and employment. Those selected for the program, which runs from June to September, will attend three multi-day business development workshops—two in Chicago, one in Baltimore—with travel stipends available from VilCap.
Last year, VilCap ran a similar program, through which Pear Deck, an interactive assessment and presentation tool, and MPOWER Financing, which offers loans to college students, each won $100K in funding. VilCap may invest another $250K to $500K down the road.
Support for the program comes from a $15.1 million fund that VilCap closed in mid-February. Steve Case, founder of AOL, and his wife, along with Mitch Kapor and Freada Kapor Klein, are limited partners in the fund. VilCap also runs similar peer-based business programs for entrepreneurs in other sectors including agriculture, energy, finance and healthcare.