Arjay Ruggles’ Post

Thanks so much for the feature; it was an absolute pleasure!

1% of pre-seed funding goes to black founders. As the 483rd black person in US history to raise over $1M for their startup, I'm often asked how I became part of this exclusive group. I built a business that hit breakeven by month two and was generating $15,000 in profit by month 4. We were impossible to ignore, leading to me closing $750,000 in capital in under three weeks. However, the harsh reality is that structural racism and bias within the VC industry make it an *extremely* unreliable source of capital for black founders. Even more so than for women, Asians, or any under-represented group. Most Tier 1 funds have never backed a black founder in their multi-decade history. And of those who have, the number of black founders in their portfolio is in the single digits. Therefore, black founders MUST prioritize building a business with sustainable unit economics and a clear pathway to profitability. If you need capital, raise from family and friends, apply for SBA loans and grants, leverage no-code/low-code tools, and do anything else it takes to build the business without VC funding. Once you have a business that is generating significant revenue and on a clear pathway to breakeven, you're actually ready to approach VCs. Because that is the only time they will pay attention. White founders have the luxury of asking VCs to fund their ideas. Black founders do not. Your job as a black founder is to change the conversation from "fund my idea" to "fund my growth." If you can do that, you'll quickly join our ranks as one of the few black VC-backed founders.

It's critical for early-stage founders to approach events strategically for fundraising and business development. Attending numerous events can be deemed a red flag, but completely avoiding them isn't the solution! Recently, I had an insightful discussion with Cristian Raygoza, Managing Partner of Iluminar Ventures, who shared a comprehensive framework on how Pre-Series A companies can effectively leverage events. Understanding an investor's perspective is key to maximizing the potential of building new relationships in such settings. For more valuable content on navigating the startup landscape, consider subscribing to my bi-weekly newsletter, "The Squeeze" for founder-focused insights and strategies! (🔗 in the comments)

I recently sat down and interviewed Michael Berolzheimer, Managing Partner and Founder of Bee Partners about his thoughts on data rooms. This important step of the due diligence process offers a unique opportunity that Michael says most founders completely overlook! Check out the full interview here on LinkedIn to gain valuable insight into his thought process about data rooms for Pre-Series A companies.

This feels incredibly surreal to type: On June 26th a software platform I built will be represented and discussed at the White House! For the past six months, I’ve been hard at work building the MVP for Reliabl. I was originally introduced to Annie Brown through my dear friend Ben Stokes and from the very first moment we met, I knew that Annie was someone special. She has that rare combination of charisma, tenacity, and intelligence that makes for an all-star CEO. So I agreed to come on board and bring their first software product to market. It took many sleepless nights, but their product has officially entered private beta; the first customers are already onboarded and several more are lined up to onboard in the coming weeks! Throughout this entire time, Annie has never stopped pushing to build this company from the ground up. I’ve watched as she navigated one of the worst fundraising environments in recent memory, all while facing the realities of being a woman in an industry that has historically excluded them from access to capital. So when Annie told me about this opportunity, I told her that it was well deserved. A huge thanks to Patrick Driscoll for organizing this roundtable and providing this incredible opportunity. Annie, you’re going to be amazing!