Less than 3% of black and Hispanic tech companies are funded by venture capitalists.
Eli Rivera and Ruben Gaona, co-founders of The Way Out app, are one of the lucky few. The app developer recently received $400,000 in seed funding from his capital fund Gateway Capital Partners, a black-owned venture based in Milwaukee.
Rivera and Gaona said they are very pleased with the funding from people of color who align with their mission and ideals of helping black and brown people released from incarceration.
Launched in 2020, the app connects previously-incarcerated job seekers with potential employers, re-entry service providers, training programs, and even transportation to and from work. Jobs offered through the app range from retail, hospitality to landscaping.
“If we were to partner with[venture capitalists]we wanted them to truly understand and experience the systemic inequalities we were addressing through our platform,” said Rivera. “Having a VC group run by a black woman backing us is perfect.”
Like most minority startups, Gaona and Rivera struggled to raise funding. The typical process of funding a business starts with family and friends.
Rivera said the process hurts people of color.
Many black and brown tech founders don’t have families with large savings, mortgages, or IRAs to borrow from. It’s even harder for black and brown tech startups to raise venture capital.
“It’s less than 3% combined. It’s women. It’s black and brown founders,” Rivera said. “It’s a little.”
The funding was announced in mid-December. This will allow them to focus on growing their business without continually winning grants or pitching contests.
“It’s like fighting every day to figure out where the next little pot of money will come from,” Rivera said. “It takes a lot of energy and focus out of what we do.” It (funds) allows us to do business, it’s not business.
more:https://www.jsonline.com/story/news/2022/06/27/tech-program-helps-people-released-prison-learn-computer-internet-smartphone-skills/7490164001/
The development of the app began with Rivera and Gaona’s own life experiences.
Both spent time in prison. Each overcame the challenges of reintegrating into society and avoiding recidivism. Men know that successful re-entry of previously imprisoned individuals begins with employment.
That was enough to get Gateway founder Dana A. Guthrie to endorse the app.
Guthrie, who is also a managing partner at Gateway Capital Partners, said:
“The Way Out shows that the judicious application of technology can address social issues within a highly scalable business model,” she said, noting that her company has seen “financial returns and We don’t believe that social returns are mutually exclusive, and The Way Out is a great example of that.”
The funding will also allow Rivera and Gaona to expand and fine-tune their apps to bring them to market faster. 70% of his money goes to software development.
When the app launched two years ago, they created a leaner version. The goal, like most tech startups, was to get the product out there and prove it worked.
This app uses anti-bias hiring software that creates a blind profile for each job seeker by removing names, addresses and other elements. This enables interviews and hiring decisions based on qualifications, certifications and work experience.
“The Way Out’s software ensures that no one’s application is overlooked by explicit and/or implicit bias,” says Rivera.
Tweaking the app could potentially attract more employers and help judicial job seekers find jobs. It could also help re-entry service providers connect people to resources. increase. According to Gaona, the app breaks the cycle of imprisonment through technology.
“Just building technology to find ways to help those impacted by justice, connect them with employers, and create a platform where everyone can come and feel safe. I’ve never seen one before,” said Gaona.
The Way Out has provided over 1,000 support services, including employment, housing, transportation, medical care, technical training and legal services, to over 300 individuals impacted by justice. These resources provide an untapped talent pool for employers struggling to attract and retain talent, while minimizing the risk of employee turnover.
The retention rate of job seekers hired through the app is 90%. According to the U.S. Bureau of Labor Statistics, the average employee turnover rate in 2021 was 47.2%.
“What sets us apart is our holistic approach and the fact that we are providing support to individuals affected by justice while they are looking for work,” Rivera said. “It’s all about maximizing our influence.”
