Arlan Hamilton represents the new wave of venture capitalism

25 Jul 2017

Arlan Hamilton, founder of Backstage Capital, on stage at Inspirefest 2017. Image: Conor McCabe Photography

As a black, lesbian woman, Arlan Hamilton is a Silicon Valley outsider. And she is rewriting the rulebook of venture capital.

One of the most curious exchanges at Inspirefest 2017 took place during an interview between Astia’s Sharon Vosmek and Arlan Hamilton of Backstage Capital.

“Arlan takes stuff from nothing and turns it into something,” Vosmek said to the crowd.

‘I have an insatiable curiosity mixed with the love of freedom and having a say in my destiny. I am the new face of venture capital’

Nervous about being on stage, Hamilton focused on Vosmek and tried to imagine the audience wasn’t there. By way of narration, Vosmek would occasionally turn to the crowd and explain some of Hamilton’s backstory and modus operandi. It would only add to the enigma.

A black, gay woman, Hamilton represents the new wave of venture capitalism that brings more diversity to Silicon Valley by investing in women, minorities and the LGBTQ community – basically, the people that Silicon Valley’s elite investors tend to ignore.

The new wave represents a welcome counterweight to the beige, white-male-dominated venture capital industry.

Hamilton’s firm Backstage Capital has collected support from some of the giants of investment in Silicon Valley including David Rose, Marc Andreessen, Aaron Levie, Swati Mylavarapu and Crystal English to name a few.

Investing in representation

Based in Los Angeles, Hamilton founded Backstage Capital after she had quit her previous job and was living couch-to-couch with friends.

Today, Backstage Capital has invested nearly $2m across more than 45 companies. With a total fund of $5m, it seeks to take a 1pc stake in early-stage start-ups.

Prior to this, Hamilton was a tour manager for Atlantic Records artist Janine and published the internationally acclaimed indie music magazine Interlude.

As Hamilton told Vosmek before the Inspirefest crowd, nothing she does is conventional. Her entry into the music industry, for example, began in her early 20s when she discovered a band from Norway called Golden Boy on the internet and offered to be their tour manager. They accepted.

“I left a bank job and took them around the country. It was 2001 and I just reached out to the lead singer on email and said, ‘Can you come over and play?’”

Her childhood was pretty normal. She watched a lot of MTV, loved The A-Team and went to lots of concerts.

Her foray into publishing began in her bedroom when, at 24, she began publishing Interlude and swiftly built a global business with thousands of subscribers worldwide.

“In the middle of that, I broke up with my girlfriend. I was super-depressed and started writing about my feelings and things to cheer myself up.” That blog, Your Daily Lesbian Moment, attracted 50,000 readers a month.

Hamilton told Vosmek that her mother was always an inspiration. “My mom is a dreamer and she always gave me a freedom to dream bigger and brighter.”

When asked by Vosmek what drew her into venture capital, Hamilton explained: “I have an insatiable curiosity mixed with the love of freedom and having a say in my destiny. I am the new face of venture capital.

“I started completely by scratch. I had been working with companies of all profiles and I remember seeing a disparity in the funding and being shocked.”

Hamilton felt that the venture capital industry had a lot of room for improvement, especially in terms of access and who got funded.

“Backstage Capital is sector- and industry-agnostic by design,” she said, as she explained her rationale for investing.

In 2016, she personally saw 1,000 or more companies in areas such as artificial intelligence, fintech and virtual reality.

“There’s some really deep tech stuff that I have had to take weeks to understand, including fashion.”

Hamilton doesn’t buy into the Silicon Valley mythology that there is a pipeline issue in terms of women and minorities. She believes the mould can and will be broken.

“I just think that we can effect change. 2012 to now has been about data collection, recognising the problem. The next five to 10 years will be amazing for all types of founders.

“You just have to break ground for things to be made,” she concluded.

“Representation is the most important thing for me and that is why we started this thing.”

Inspirefest is Silicon Republic’s international event connecting sci-tech professionals passionate about the future of STEM. Ultra Early Bird Tickets for Inspirefest 2018 will be on sale soon. Sign up here to be the first to know when!

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years