By Ashley Benkarski
NASHVILLE, TN — Howard Marks is co-founder of video game giants Activision and Acclaim Games (now part of the Walt Disney Company). After launching StartEngine as an accelerator in Los Angeles, Howard relaunched StartEngine as an equity crowdfunding platform after discovering how difficult it was for entrepreneurs to raise venture capital. StartEngine has now raised over $300 million for startups from its online community of over 300,000 investors.
“I wanted to try my hand at the other side of the table: investing in other founders and helping other entrepreneurs achieve their dreams,” Marks said. “From [my] experience, I saw firsthand how hard it was for the founders I invested in to raise more funding, particularly for the female and minority founders in my portfolio.”
“The biases present in the world of venture capital are well documented,” Marks continued, explaining women entrepreneurs received only two percent of venture capital funding last year, with another 2.6 percent going to Black and Latinx founders. Ten percent of StartEngine’s regulation crowdfunding goes to Black founders, with four raising over $1 million last year, he said.
That number still isn’t where the company wants to be, Marks stated. “There’s more work to be done to support underrepresented founders, but it’s a start.”
Tamar Blue used StartEngine for her business, MentalHappy, and shared that “as a Black founder it’s tough to work around things like
funding metrics,” she said. “When we started MentalHappy we wanted to find alternatives for funding. We applied to StartEngine and they were particularly empathetic and aware that it’s important to fund [people of color] businesses.”
That demographic gets less than one percent of all available venture funding, with women of color receiving about .006 percent, she remarked.
MentalHappy oversubscribed on its first funding goal aided by a significant number of African American first-time angel investors, which Blue described as an empowering and motivational experience. MentalHappy’s campaign has since ended and to date the company has received more than $1.1 million in venture funds, she continued.
With May being Mental Health Awareness Month, the time is right for MentalHappy. “MentalHappy is an online mental health platform for people seeking peer support for those struggling with depression, anxiety, stress—or even those who may be experiencing a particular life event and looking for resources and help,” Blue said.
The “shutdown-iversary” as she called it has been compounded by the pandemic’s financial impact and “connecting with others who are going through the same thing and can understand the nuances of that journey” is important, she said. Monitored weekly dialogues with health and wellness professionals and moderators are available.
Free to join, MentalHappy is a good starting place for those seeking low cost and low barriers to entry, she remarked.
When it comes to entrepreneurs like Blue finding the capital needed to grow and scale their businesses, Marks said StartEngine is a great starting place. “StartEngine is a platform that gives you control of your destiny,” Marks said. “You set the terms of your raise. You don’t give up board seats or control of the business in exchange for cash. You let your customers and supporters become your investors, building an army of advocates. This in turn creates more loyalty with your customers and gives you a core group of people that you can leverage for your growth.”
Additionally, the company offers StartEngine Secondary which “allows investors to trade shares issued via equity crowdfunding and offer liquidity to their investors all on one site,” Marks added.
“This is the future of startup financing where founders can be aligned with their investors, offer early liquidity, and early users can be rewarded for their loyalty to new companies,” he continued. “It’s a win-win for entrepreneurs and everyday investors and represents a paradigm shift for the U.S. economy.”
For more on the equity crowdfunding platform visit startengine.com, which contains a list of current startup campaigns. For more on MentalHappy, visit mentalhappy.com.