As the CEO of Bayleaf Angel Investments, Mike McKie is always on the lookout for enthusiastic, passionate and talented entrepreneurs in need of investment to boost their business. A lot of his focus goes into opening up funding opportunities for people who may otherwise not be offered them due to different attributes such as gender, race or disability – minority-owned businesses.
Mike believes each business should be judged on its merit, and whether they are ideal for investment or not should be based on their ideas, plans and feasibility alone.
Here, Mike discusses his introduction to the world of angel investments, the origin of his passion for helping minority-owned businesses, and how he strives to assist entrepreneurs.
Where did your focus on opening up funding opportunities for minorities originate?
My career began on the agricultural side of PepsiCo procurement. Unlike most types of procurement, which takes place between corporations, the suppliers involved in agricultural procurement are personal businesses, with personal wealth and family wellbeing inextricably linked to the success of their business.
This puts an enormous amount of responsibility on both parties to behave ethically and responsibly in terms of pricing, prompt payments and consistent workflow.
My experiences dealing close up with this type of entrepreneur – funded not by venture capitalists, but by sweat equity in the most challenging environments – made me passionate about helping small, minority-owned businesses succeed against the odds.
The experiences I had in my early career – especially in Russia, India and Latin America – really showed me the importance of small-scale businesses outside of the main urban centres. The hard work and commitment that these farming communities brought to their work truly influenced my development of Bayleaf Angel Investments.
What has challenged you most in your career?
The biggest difficulty in my career followed experiences with the rurally-located, minority-owned businesses, as they completely altered my worldview.
Coming from a North American or North European business corporate culture and then walking onto a Russian potato farm, an Indian mango plantation or a small village in South East Asia – where the villagers share the proceeds of the coconuts that they all harvest from the trees – those experiences challenge your view of the world.
You tend to forget the corporate-speak, the PowerPoints and the relentless grind of the quarterly forecast when immersed in those environments and need to focus instead on understanding and building relationships with people who have an entirely different life experience than your own.
How are minority-owned businesses traditionally overlooked?
Minority-owned businesses face many difficulties, but their main barrier is the struggle of funding – especially in markets with underdeveloped banking systems. Cruel societal prejudice often leads to a lack of financing options for budding entrepreneurs – regardless of whether it’s based on gender, religion or ethnic factors.
There are stereotypes abound in mainstream banking with processes which require extensive paperwork and potentially expensive travel to main cities to even apply for funding. This leads to a continuation of the status quo and limits opportunities for the growth of local businesses.
These barriers, that limit funding for minority-owned businesses, aren’t as obvious and restrictive as they once were, but they certainly still exist; manifesting in subtle ways. Angel investment networks are a common source of funding for female entrepreneurs and minority-owned businesses.
These networks are typically comprised of a majority of white, male, middle-aged businessmen who have come through, and earned personal wealth from, the traditional corporate system – with its inherent lack of diversity. Funding is made available for people who talk like, dress like and present like the angel investors.
What are you doing to change this?
Bayleaf is partnered with Kiva.org, on an individual and a business level, to provide micro-funding for female entrepreneurs in Latin America and Africa, with an emphasis on agriculture and food.
This allows us to provide investment loans to motivated women who have been rejected or ignored by traditional banking.
Within Bayleaf itself, my team of investors and business owners and I make sure to take the extra time to challenge themselves to assist any budding entrepreneur in need of funding for their minority-owned business.
Sometimes a potential partner from a minority background comes to us with an investment which appears unattractive, poorly presented or under-prepared. While our ‘normal’ process would be to reject such a proposal, we instead offer mentoring and support services to the entrepreneur to help them to develop an improved plan.
While this does not by any means assure that we will invest ourselves, we try to take the time to support them and ensure that the entrepreneur leaves their interaction with us better prepared to continue their journey.
The investors at Bayleaf Angels only invest their own funds and want to work solely with businesses they can personally impact. Most investment networks are, in my experience, Tinder for investors. We don’t want to join ten other investors who swiped right on a list of filtered investments. We want to work with people who see the value of working with us.
What advice would you offer minority-owned businesses when aiming to secure investment?
I urge those whose background or concept is a little outside of the ‘norm’, to find the right angle to celebrate it and use their passion to create a point of difference. Also, anyone seeking funding should find investors who value the entrepreneur as much as they value the business.
My last piece of advice is if an investor wants to ‘smooth the rough edges’ of your concept to make it more palatable to their investment, hold firm and maybe find an investor who sees the sparkle in your venture.