Starting a business is always very exciting. There is a sense of fulfillment and freedom that comes with being your own boss and bringing your ideas to life that every person should have the opportunity to experience. Although, along with great reward, entrepreneurship comes with considerable risk. The risks can be costly and take a mental, emotional, and financial toll on the brave souls who dare to blaze their own trail.

Pattern and Practice of Predatory Lending to Black Communities Entrepreneurship is an important mechanism for promoting economic mobility, wealth accumulation political acquisition and job creation in Black communities and access to financial capital is a critical element of new business formation. However when it comes to personal and business financing, Black people have long been victimized by predatory lending. Federal and other studies have now documented how Black Americans were particularly targeted for predatory and subprime lending, even when they qualified for traditional mortgages. No other community was targeted as aggressively as were Black Americans. Predatory lending to the Black community comes in many forms, not just sub-prime mortgages. Less than 3% of venture capital flows to Black entrepreneurs, which makes the Black business community vulnerable to unfair and deceptive funding tactics. In business financing, predatory lending can come in the form of a convertible note. What is a Convertible Note? A "convertible note" is one of many investment vehicles.  It’s a loan agreement between an investor and a company.  Convertibles are usually used at the "Seed" stage of financing, that is, after investments by friends and family at the earlier concept stage but before the "Series A" stage equity round. They're called "convertible" because they start out as debt (a "note"), then under certain circumstances "convert" into equity. Usually that equity is "preferred stock." The conversion circumstances typically include either the company raising another round of funding, or selling, or the passage of some amount of time, usually around 18 months. If the company doesn’t satisfy the requirements for the note to convert to equity, the investor has the option of demanding full and immediate repayment of the funds, plus interest. Real World Example Convertible notes can cause turmoil to a start-up or small business.  Before joining Black Connect, a BC member completed an accelerator and she was excited when an investor expressed interest in her company.  Without the advice and assistance of an attorney, this entrepreneur blindly accepted the terms of the convertible note with a principal amount of  $250,000. Photo:  actual terms from the entrepreneur’s convertible note. In this case, in order for the note to convert to equity, the entrepreneur had to raise an additional $300,000 within 18 months.  Given the fact that most Black-owned start-ups fail within the first 18 months and that less than 3% of venture capital flows to Black entrepreneurs, the odds of the average Black entrepreneur raising $300,000 within 18 months is pretty slim (1).  So it should come as a surprise to literally no one that this entrepreneur did not raise the $300,000 by the 18 month deadline. After the maturity date, the investor opted to exercise its right to demand immediate return of its $250,000 “investment," which of course the entrepreneur did not have because she had used the funds as intended to run the business.  Nevertheless, the investor sued the entrepreneur and the entrepreneur then reached out to Black Connect for legal assistance, but by then it was too late.  The entrepreneur was in breach of the contract and did not have a defense to the lawsuit.  Ultimately, after adding interest and the investor’s attorneys fees,  the entrepreneur ended up with a $300,000 judgment against her company and she shut down the company.  She has created a new company and is now starting over from scratch. Grants vs. Convertible Notes There is an increase in business accelerators and other funding opportunities that are targeting Black entrepreneurs and small business owners who are desperately seeking investor dollars for their start-ups and it is critical that entrepreneurs closely examine and fully understand the terms of an offer of investment in their business. Convertible notes can also be advertised alongside grants to non-profit organizations.  In the illustration below, the investor clearly discloses that an investment in a for-profit business will most likely be in the form of a convertible note.  However, not all advertisements plainly disclose this information so it is incumbent upon the entrepreneur to engage in due diligence.  Photo: New Media Ventures advertisement for funding opportunity The Takeaway All money ain’t good money so when you apply for accelerators or other funding opportunities, be sure to: Always seek legal guidance before signing a contract; Assess your needs and risk exposure and negotiate deal terms; Ask questions like: How many Black entrepreneurs have been offered funding? What percentage of those Black entrepreneurs have been offered convertible notes? It’s important that you weigh the risks against the benefits and make an informed decision because even with an injection of cash into your business, you can quickly be out of business if the terms of the deal aren’t favorable to you and the investor doesn’t take into consideration your needs, risks, and limitations as a Black entrepreneur in America.   (1) Black-owned startups start smaller in terms of overall financial capital and invest less on average as they mature.  In order for Black and white-owned businesses to converge in size, Black-owned businesses would need substantially larger capital injections in the years after inception to make up for differences at founding.  However, the size of later cash injections for Blackened businesses remain significantly smaller in later years. Thus, on average, businesses started by Black founders do not converge to the size of white-owned businesses as they age and 8 out of 10 Black-owned businesses fail within the first 18 Months.

Why You Need These 7 Personalities On Your Team If You're an Entrepreneur Every entrepreneur and business owner needs the right people on their team to be successful. It doesn't matter how viable your business idea is. Without the right team, your idea could never come to fruition, or your business might not reach its maximum potential. A winning team has the right mixture of individuals with different personalities, skills, resources, and work styles. For a team to be successful, each person must play their position.  Each person fills a unique role that contributes to the overarching business goal.  The most successful businesses have a melting pot of personalities. Personalities You Need On Your Team   #1. The Strategist The Strategist is an essential member of every team. She or he is a visionary and leader. The group relies on this personality for direction because the Strategist creates the road map to success and minimizes risks. You can think of the Strategist as a professional opportunist. She or he can identify a need in the market and come up with a business plan to capitalize on it. The Strategist is a thinker who can refine an abstract idea into an executable plan of action and help you outperform your competitors. Duties of the Strategist  The Strategist makes significant decisions that impact every area of the business.  The success of the team lies on the Strategist's shoulders, so she or he must be decisive and a clear and effective communicator. The duties of the Strategist include: Develop strategic plans  and objectives Identify problems and proffer workable solutions Hiring and leading senior team members Budgeting C-Level executives are often the Strategists on any team, with titles such as Chief Executive Officer (CEO), President, or Executive Director, depending on the business structure.   #2. The Executioner The Executioner brings the vision of the strategist to life. She or he is responsible for the execution of the steps in your action plan and handles the day to day operations of your business. The Executioner is good at managing people and knows how to interact with different personalities and skillsets in order to bring out the best performance of each team member. This personality has a reputation for being disciplined, organized, and reliable.  The Executioner is diligent and streamlines tasks to work efficiently. The Executioner's high productivity makes him or her an indispensable member to every team. Executioners can be found working as the Chief Operating Officers (COO) or  Executive Director in a business.   #3. The Geek The Geek is another unique personality you should have on your team. This person knows and loves all things tech and ensures that your business is utilizing the latest technology for better efficiency. The Geek's lifestyle revolves around their passion for technology. She or he often prefers to interact with computers over people, which can make the Geek socially awkward. The Geek is a problem solver who thrives on a challenge.  This personality loves learning and is meticulous at understanding the glitch in the matrix. The Geek will leave no stone unturned to resolve tech-related issues and use technology to grow your business.  The best role on your team for a Geek is Chief Technology Officer, IT Supervisor, or IT Compliance Officer.   #4. The Hustler  As the name sounds, The Hustler is a business-savvy team member who sees dollar signs.  The Hustler can make a dollar out of fifteen cents.  Whatever the Hustler does is geared towards creating more revenue for the business. This personality will always strive to strengthen the company's culture, ignite the team's passion, and update revenue models. Hustlers are great persuaders. Their gift of gab and charming personality can disarm even the most robust customer or investor.  The Hustler is persistent, a go-getter with a growth mindset. She or he is extroverted and knows how to make the right connections and attract sales. No matter the situation, the Hustler will think on his or her feet to find the right angle to close the deal. The Hustler's focus is on generating revenue for your business.  She or he knows how project costs, sales, and expenses and understands how sales and other financial data impact your business in the short-term and long run.  Hustlers are best suited as sales directors, business development managers, fundraisers, and sales managers.   #5. The Fixer The Fixer works closely with the Executioner.  This Olivia Pope personality is resourceful and offers creative solutions in the face of the direst circumstances.  Fixers dwell behind the scenes and often have a no-nonsense reputation.  The Fixer believes that perception is the reality and will strive to keep your business scandal-free by paying attention to details and thinking outside the box to quickly resolve any crisis.  The Fixer scrutinizes and analyzes your business decisions from a crisis management perspective.   These problem-solvers are best fitted for the role of Crisis Manager, Brand Manager, Reputation Manager, Communications Director, Public Relations Director, Customer Service Manager, Human Resources Manager, Compliance Officer   #6. The Extrovert The Extrovert is the attention-seeking personality on every team. They love social media and opportunities to mix and mingle. The Extrovert tends to have large social circles, and are comfortable with public speaking and being the center of attention. Extroverts are friendly and expressive and enjoy interacting with other people. They make great team players and usually play a leading role in group projects.  Extroverts can also help strengthen your team by organizing parties, outings, and other activities to increase team spirit and boost company morale. Some of the best roles for Extroverts are Brand Ambassador, Social Media Manager, Sales Representative, and Customer Service Representative.   #7. The Introvert The Introvert is the strong silent type. They don't act in haste.  Instead, they analyze available information and deliberate before making a decision. To the Introvert, being around large groups of people is physically draining; this is why they like working alone or in small groups. The Introvert tends to listen more than she or he speaks. The Introvert is a good team leader in a more complex environment because she or he remains calm under pressure and analyzes a situation before deciding on the appropriate response. The Introvert is intensely focused and hardly gets distracted. When it comes to attention to detail, the Introvert tops the list. The Introvert's work ethic is unparalleled. They will not settle for mediocrity with even the most basic task. The Introvert may not speak much in a meeting. They are listening intently and analyzing the information being discussed. The Introvert is flexible and can lead as well as follow.  They perform well in supervisory and managerial roles or in an administrative capacity. Here are some of the benefits of having this personality on your team. Introverts hardly get distracted when working on a task Introverts are innovative and creative thinkers They are great listeners and require less supervision Introverts are calm when under pressure Above all, they are well organized and prepared You will find introverts working as legal analysts, business analysts, research & development directors, content writers, executive assistants, administrative assistants, shipping managers, and logistics managers. Conclusion You need different personalities on your team to achieve the best results for your business.  As a business owner, it is your responsibility to make sure that each team member's personality and contributions to the team is understood and respected.  Every person on the team should feel valued. Maintain clear and constant communication with your team to be sure that everyone is working towards the same goal and understands their role in achieving stated objectives.  If your business is missing any of these personalities, post your business opportunity to develop a winning team.  Once you have all the players in position, plan to win!  

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