Exclusive: Black Operator Ventures Wants To Close The Series A Funding Gap For Black Tech Founders
Black Operator Ventures (Black Ops VC) is working to close the Series A funding gap for Black tech founders.
Black Ops VC is a venture capital firm led by a Black team of co-founders with a shared mission to “invest in extraordinary founders solving complex problems with software,” its CEO, James Norman, said in conversation with AFROTECH™.
Norman and Black Ops General Partner Sean Green sat down with AFROTECH™ to discuss the firm’s vision, leading oversubscribed Series A rounds, opportunities in today’s investment landscape, and more.
The duo met nearly a decade ago in Los Angeles. Green was among the early cohorts of Transparent Collective, which supports Black, Latinx, and womxn entrepreneurs with raising early-stage funding, and Norman serves as its chairman.
Call To Action Realized
Before their paths formally aligned, the pair charted unique territory. Norman launched his first company at age 16, an online retailer for car and home audio. He had always been interested in building businesses despite not coming from a family of entrepreneurs.
“You couldn’t get a job at 12 years old. So my only option was to create my own revenue stream,” Norman explained.
Building businesses became a lifestyle for him, and he says it became evident to employers that his mindset didn’t align with maintaining a 9-to-5. This only motivated him further to get creative in how he supported himself. Today, he leads Stealth AI, which is “bu
While generating revenue has always been a priority, he is equally concerned about closing the wealth gap and creating opportunities where disparities often exist.
This is also how Green feels. He shares that his hustle was inspired by his Jamaican mother. She had little education and had lost her parents at a young age but carried a great sense of responsibility and understood the importance of generating capital as she moved to Toronto and started a maid service business.
“That’s how she put us through school,” Green recalled.
Observing his mother’s determination led Green to understand how to build a business from the ground up. He started his own newspaper route business in Toronto early on and established a hedge fund after completing his higher learning. He is the founder of ARTERNAL, which is a vertical SaaS platform that brings everything in the art world together, transforming relationships, artwork inventory, and sales for art dealers, art gallery owners, advisories, and their staff, according to its website.
Reflecting on the pair’s experience, Green acknowledged, “In order to get there and raise millions of dollars, it took a whole process, and I realized that we’re connected to the godfathers of venture capital, not through any sort of relationship that came passed down from a friend or family, but was through sheer brute force like, ‘We’re gonna make it or not.’ It’s that 50 Cent quote of ‘Get Rich or Die Tryin.’”
He continued, “The pathway to raise funds comes through this warm intro, which is almost impossible… So, I knew the plight of raising capital, looking like how we look like. And I was like, ‘This is virtually impossible for the next Sean or James to be able to come through and check the boxes that we’ve had to check off to get here.’”
Norman says he recognized that some goal posts set in funding were imaginary. When he was looking to raise funds for his former venture, GroupFlix, an a la carte TV service, he was promised by investors that he would be given money for a pre-seed round if he had the content contracts. The money never came.
“I built the product. I got a crazy team from MIT (Massachusetts Institute of Technology) and Stanford. I got a thousand people’s sample credit cards, and now I got these content contracts, so surely they’re going to give me the money,” Norman recalled. “And the money never showed up. So I realized, one, these goal posts that get set aren’t real, and two, there’s a massive gap here for access to capital for people who are like me.”
Black Ops VC’s Portfolio
Black Ops VC has 15 companies within its portfolio supported through $20 million in Fund I. The venture capital firm has made investments in companies like Athlytic, a company that connects college athletes to brands so they can profit from their name, image, and likeness (NIL); WhoseYourLandlord (WYL), which offers AI-generated insight reports from residents to real estate owners and managers so they can gauge their property’s performance; and ChurchSpace, which was founded as a marketplace for churches to generate revenue by renting out their property when not in use, according to information on its website.
“They were the Airbnb for churches. Now they are what you call kind of micro fulfillment, last-mile delivery for DoorDash and hopefully soon like Amazon and Walmart,” Norman said of ChurchSpace, founded by Emmanuel Brown and Day Edwards Antwi. “Actually leveraging churches, the most underutilized real estate in the country… and actually allowing those facilities to be used for transfer of products into the local communities they exist in.”
He added, “These are like ideas that you come to because you’re in communities where you’re experiencing a problem or seeing an opportunity that you close in on. It’s like real lived experiences that lead to people leading these types of companies.”
Closing Series A Gap For Black Tech Founders
According to a press release, in May, Black Ops VC led ChurchSpace’s $1.2 million oversubscribed funding round. This is also an intentional strategy of the firm, which seeks to close the Series A gap for Black tech founders.
“Our Founders typically raise partial rounds. So you never get an actual full seed round done if you’re gonna get a seed or a full pre-seed round done,” Green said. “And, we want to be very intentional in the fact that we help get, we lead seeds and we help people oversubscribe. And fortunately, we’ve been able to do both lead and help our founders oversubscribe.”
He continued, “There’s a dearth of founders at the Series A, there’s just not a lot of us, and it’s because if you can’t raise a full pre-seed and you can’t raise a full seed, how do you get the escape velocity that’s necessary to show the metrics that that Series A fund is looking for? It’s virtually impossible. So by sheer nature of having a full pre-seed, having a full seed, puts you in position to then have the same conversations that our white counterparts are and hitting the same metrics and goals.”
Norman added:
“You don’t see a lot of Black unicorns, even 5-10 years ago. People aren’t receiving the kind of capital they need to create the kind of net-breaking inflection point that’s required to continue down this path of business scale. So that’s the gap that we intend to close because we’re making sure people have full rounds of funding up front and are properly structuring their rounds. They’re not doing ridiculous valuations. Their cap tables aren’t messed up. They have proper board governance, proper operational integrity with their governance. They’re set for success from the early stages. That’s what we’re bringing to the table that we know didn’t really exist out there for people like us.”
Overall, Norman says the companies within Black Ops VC’s portfolio are performing well and states that founders have always achieved their milestones with its backing.
He also acknowledged that there is an excellent opportunity in government tech and AI.
Looking ahead, Black Ops VC intends to raise for Fund II, but it is still deploying capital to founders from the first fund.
