For many, Rodney Sampson is one of the most well respected entrepreneurs in the country. With decades of experience running, investing in and advising companies like Digit, Sandbox and Southern Culture Foods, he was an ideal choice to speak at this year’s City of Milwaukee Small Business Sustainability Conference at Manpower Corporate Headquarters.
He’ll deliver his keynote speech Monday, May 2, but before that he answered some questions about how to make a small business succeed.
Many people know you from your work on “Shark Tank.” What were you doing leading up to that?
I've been cofounding startups, investing in startups and the entrepreneurial ecosystem, advising high growth companies and publishing content for 16 years. Regarding Mark Burnett Productions and “Shark Tank,” Paul Lauer, founder of Motive Marketing, introduced me to Mark.
I've worked with Paul since 2003, when I was asked to advise Mark on some of his film properties. When that was done, I gave Mark a copy of my book, Kingonomics, and asked him to focus in on the aspects on diversity & inclusion. He did, and subsequently asked me to join his team as the first head of diversity and inclusion.
I’ve read that you are passionate about reducing poverty and the wealth gap. How specifically do you think we can do that?
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In essence, there are only a few ways to create wealth and/or close the wealth gap. For context, the racial wealth gap is over $100,000 ($140,000+ average net worth for white Americans; $11,000 for African-Americans). We can close the wealth gap by:
Starting a high-growth company, scaling it and selling it.
Investing in a high-growth company that is scaled and sold.
Working for a high-growth company in which part of one's compensation includes equity.
Receiving an inheritance. This one is out of one's control and relies on parents or relatives.
What do you think is the biggest challenge small business owners face and how should they go about overcoming it?
The biggest challenges include selling products and services that people will actually pay for, a lack of knowledge on the entrepreneurial ecosystem and best practices in entrepreneurship, a lack of knowledge of how fundraising works, and dreaming too small.
How would a business go about getting funding from your firm? What do you look for? What do you make sure to stay away from?
They simply apply. Now, that said, it is important for entrepreneurs to do their due diligence and make sure that they know the investment thesis of the fund they are applying to. A BigData, Internet of Things (IoT) tech fund won't invest in a service based business or film project.
In addition, understanding the stage a fund invests in is critical as well. If you apply to a seed stage fund, don't expect Series A funding. Learning how the investment ecosystem works is incredibly important. Also, applying to a seed fund or venture fund isn't the same as applying for a bank loan.
Finally, learn patience. Investors are very business-oriented and are usually spending a lot of time reviewing existing or potential investments. Persistence is key as well; but coming off desperate is a big turnoff and is the quickest way to get ignored. Seriously.
