This Angel Network Is Committed To Funding Tech Startups With Black, Brown & Women Founders
Rashad Moore is a veteran angel investor for six years, and when he didn’t see founders who look like him coming through the networks, he did something about it.
He started Score 3 Angel Networks, committed to funding game-changing tech companies led by Black, brown, and women founders.
Based in McLean, Virginia, Score 3 describes its members as everyday angel investors — seasoned, high-net-worth angel investors, managers of seed funds, and professionals from later-stage venture funds.
In addition to funding Black, brown, and women founders, Score 3 differentiates itself in other ways.
It conducts its monthly pitch meetings and investor meetings via video conferencing. Score 3 has investors all over the world and the U.S. including Belize, San Diego, Washington, D.C.
“The logistics are really tough to figure out,” Moore said in a Moguldom interview. “So we switched up the model to be video conferencing. (Investors) can be in their pajamas, just log in and watch the pitch. What we’re finding is that you can really build relationships online via video conferencing.”
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Moore spoke to Moguldom about his journey as an angel investor.
Moguldom: Tell us about your journey as an angel investor. Why did you start the Score 3 Angel Network specifically targeting Black, brown, and women founders?
Rashad Moore: I’ve been an angel investor for six years. I started with one of the first (angel networks) — New Dominion Angels — and also Dingman Center Angels (at University of Maryland). I was not seeing the type of diversity and the deal flow that came through the networks. You’re a founder. You have to know someone who’s already in the group. So what typically happens is if it’s a bunch of guys in the group, you won’t fund any woman. I won’t see your group. So a lot of women, a lot of brown, a lot of Black people don’t have the same networks. After four years I wasn’t seeing people who look like me coming through so I started looking on my own and started seeing all these brilliant founders that didn’t know any founders on these angel groups. I was fortunate to have done pretty well. I started going out, meeting a lot of folks in the ecosystem. They let me in. I’ve been able to meet a lot of wonderful people and all I’ve done is share that access. After I sold my company, I tried to figure out what I wanted to do with my life. I know I have a passion for angel investing. If I find a good deal I usually can put together enough angels to make the deal work. I decided, why don’t we put together a group that focuses exclusively on Black, brown and women-owned startups.
Moguldom: What’s your goal with the Score3 Angel Network investments?
Rashad Moore: Our goal is two-to-three new investments a year. That’s typical. Our first meeting was in January and next week we’re having the second meeting. It’s a monthly meeting. Every month startup founders apply to pitch. We pick the top two.
Moguldom: What differentiates Score 3 from other angel networks?
Rashad Moore: We do pitch meetings virtually via video conference. If there’s a warm response to the startups from the angels then we do due diligence, kick the tires, make sure all the I’s are dotted. If that all checks out, we’ll start writing checks.
Moguldom: How did you come up with the idea for Score 3?
Rashad Moore: We came up with the idea in March of 2017. We had about 20 people in a room one Thursday afternoon in May or June — our first in-person meeting. Mars Reel pitched. So did Veda Data — run by an awesome woman named Meghan Gaffney Buck. Score 3 didn’t invest (in Veda Data) but I personally invested. Mars Reel did well. The investors loved them. They were only looking for a small bridge round — about $60,000.
What we found is that the logistics are really tough to figure out (when investors live all over the country and the world). So we switched up the model to be video conferencing. Now that everyone is working remotely, people are starting to build relationships remotely. Most angel groups are very social. We had our first group pitch meeting the first week of January. The next one is next Wednesday. We’re going to do this every month forever. I really wanted to make sure we had national reach. I’m looking to invest in the best startups in the world period. Wherever they are, I want to find the best and brightest.
(Without video conferencing) founders would have to buy a ticket, find someone in D.C. and come pitch to us on the off chance that they’d be one of the three investments we make that year. I’m not sure if anyone else is doing pitches by video conference) but it makes so much sense.
I was just doing a pitch screening with a startup that splits time between Silicon Valley and Jamaica. Videos are recorded. They can all watch the videos at their leisure. It’s been really helpful and more people should do it. (If anyone else is doing video-conference pitch sessions) no one has invited me. It saves a ton of time, saves a ton of money. We use Zoom video conferencing.
Moguldom: What interests you when you’re choosing who gets to pitch?
Rashad Moore: At our inaugural monthly group pitch meeting in January, (we heard pitches from) Pilot.ly (a consumer insights platform that enables content creators to get feedback from audiences) and theCut.co (like an Uber for barbers.) (Cut.co is) doing an equity crowdfund right now so anyone can invest at the low end. That’s one of the ways we encourage and help black and brown founders to fundraise — through crowdfunding. We’re even getting into ICOs, like Kairos (Miami facial recognition firm led by Brian Brackeen) did. I think Brian has laid the blueprint in Mami. The world doesn’t see Black and brown and gender as much as the traditional gatekeepers of venture capital. They have an appetite for solid companies that have great teams like Kairos. I think this is a new avenue that Black and brown founders can take advantage of — ICOs.
Moguldom: What’s your experience with crypto?
Rashad Moore: I’m a nerd so I’ve been bitcoin mining since 2013. I’m always into the newest everything. I’m a software engineer (master’s in computer science from Johns Hopkins University focused on AI). I’m very aware of crypto, how they work. The ICO requires a little learning curve to be sure, but once we saw the power of it, it was undeniable. It can be a learning curve but that’s part of the passion. I only mined it for about a year. I did OK. I only got a couple of bitcoin. I had them in my bitcoin wallet and kinda forgot about them. Once they hit about $20K I went to look for them. That’s pure luck. Who’d have thought? My wallet was in an old desktop computer I had to resurrect.
Moguldom: Y-Combinator’s Michael Seibel distilled down his advice to founders on what he’s looking for when he picks the batch. He said: “Clearly state what you do in 2 sentences”. What advice do you have for tech founders seeking to pitch to Score 3?
Rashad Moore: That’s brilliant advice. Being clear and succinct is exactly what wins. You can use very few words to explain something but in using very few words, most people don’t do a good job. When pitching, people try to cram so much information into a five-or-10-minute pitch that it’s tough to follow along. Be succinct. Take me on the journey. Be deliberate and intentional about the stories that you use, the numbers you present. It’s just like teaching a class. Focus on teaching the investors vs. telling the investors. Help me understand.
Moguldom: Is Score 3 interested in early or later-stage investments?
Rashad Moore: We’re interested in seed-stage companies that have a team, a product, a few customers, but not so far along that they can’t use our financial support. Also, they need to be at a stage where we can add immediate value. An A-round or B-round is a little too advanced for us because we’re writing $20,000 checks. What we hope is the folks we’re writing those checks for grow. Our niche? They have some product, they have some customer demand. Before we invested in Mars Reel they were getting 30 million views a month, which is more than ESPN gets.
Moguldom: Who are your investors?
Rashad Moore: I prefer not to name our investors but the folks are high-net-worth individuals. You have to be an accredited investor to invest. But to get on the video conference list you (just) have to want to roll your sleeves up and help companies that are Black, brown, or people of color. Even if you don’t make $200,000 a year, you may be a product manager at P&G or Facebook or Merril Lynch. We’re looking for both angel investors and people who just want to help. We want to be extremely inclusive. Everyone knows someone. That one connection could be the difference between failure and success.
Moguldom: You began your career in the defense industry. Your company, Software Theoretic Corp. worked on projects for the intelligence industry. You sold your company to RGS Associates in 2005. How did that prepare you for your current work trying to find and fund high-growth-potential tech firms?
Rashad Moore: Being a founder, it was just me. I had a dream. I had to do this. Having started with just one person and then growing (my company) by convincing people to give you business, and then convincing people to join you was an awesome responsibility. Those experiences of running a company allow me to have much greater insight and empathy as to what they’re going through as young founders themselves. I know the type of work you have to put in, they type of quality you need. (That) helps me filter out the founders that have the best shot from a leadership and personal standpoint.
Moguldom: As an entrepreneur-in-residence at University of Maryland’s Dingman Center for Entrepreneurship, you said, “If I had this in college, I may be further along.” How are you paying it forward for Black, brown, and women founders?
Rashad Moore: University of Maryland had this phenomenal program at the Dingman Center for Entrepreneurship. They have an angel group affiliated with the college. They’re on the college campus. Meetings are on the campus. Subject matter experts have office hours there. If you’re affiliated with UMD you can sign up to speak to a subject matter expert. We’d get a lot of students asking “What do you think of this idea?” “Do you think it will work?” “Do you know someone at this company?” You spend an entire year building a company as a student. Just having all those resources in one place — you’re young, you have a ton of energy, no kids. I went to college before the dot-com boom. We just didn’t have what we have now. If I’d had that, I’d have started much earlier than I did. Not everyone can access those resources. That’s what we’re trying to do at Score 3. We want to focus on all those different forms of capital into helping Black, brown and female founders be successful. We’re not a fund so we don’t keep a fund on reserve. Angels invest their own money so every angel may have a certain amount of money set aside. Some may invest $500 per company for a total of $1500 a year. Others may invest $500,000 on four companies each a year. It depends on what your financial situation is. It’s just whatever the collective checkbook (is) of all the all the angels in the group.
Moguldom: When you created a logo contest for one of your companies — CodeStax — you described CodeStax in words one would normally associate with a craft beer. “We’re a retro, artisanal, hand-crafted custom software engineering firm. We love great software and great design. We Build Software With Soul. We’re a small team … that work on open source projects and one-off projects.” How does this type of branding help your business?
Rashad Moore: CodeStax is basically my “pay the bills” gig. I do some light consulting for companies like Raytheon and Booz Allen, but it’s mostly just a corporate entity to organize my consulting and business development consulting work.
Score 3 is my avocation; my passion project of sorts. The angel network is a very expensive hobby. And we won’t know if we’re going to make money for another several years.
Moguldom: What’s the future of Score 3? Please include your wish list for Black, brown, and women founders. If you could have anything as an investor, what would you want?
Rashad Moore: More money so that I could invest in all the brilliant founders that I meet every day who are taking big swings and tackling huge problems. My wish for the world — or just Black and brown founders — is that every person with a dream had the opportunity to truly live that dream. That’s it in a nutshell. If your dream is to start a $1 billion company, I just want you to have that. If your dream is just to graduate high school, I want you to have that.
Moguldom: What percentage of angels in your group are Black, brown and women?
Rashad Moore: I don’t know. I’ll count. We’ve got a good balance of all of the above. One thing is for sure. They are all interested in investing in founders who are Black, brown and female.