Fellowship Spotlight: Musa Capital

Named in honor of 14th-century Malian emperor, Mansa Musa, whose purported level of wealth has yet to be exceeded at any time in history, Musa Capital is working to expand wealth creation opportunities for Black tech professionals while also creating far-reaching impact in the world.

“Musa Capital has created a new approach to venture participation that has the opportunity to be a massive wealth creation event for Black technology workers and act as a new funding opportunity for underrepresented founders,” says Founder and VC Include Fellow, Allen Smith. “Given the breadth of our network, we’re harnessing a robust ecosystem to surface high quality B2B opportunities earlier than other funds, while at the same time increasing access to venture as an asset class for Black fortune 500 tech workers.”

The Seed of an Idea

Early in his career in finance, Smith worked as a consultant for a Bay Area-based consulting company called Waterstone. In this role, he focused on go-to-market strategy for new products and customer success operations. Soon after, he migrated in-house to LinkedIn/Microsoft, to launch the first joint product between the two companies which was a co-sell motion called Microsoft Relationship Sales.

Microsoft Relationship Sales (MRSS) was the result of LinkedIn Sales Navigator paired with Microsoft Dynamic CRM, intended to provide a compelling CRM package to potential customers. In the two-and-a-half years he spent in this role, Smith helped scale the MRSS team from near nascency to $100M+ in sales. “That experience was tremendous,” Smith says, “and in a lot of ways, it was career-defining.” It was at this time that the initial concept of Musa Capital came to be.

“In March of 2020, in the early days of the COVID-19 pandemic,” Smith reflects, “there was a lot of discussion with the leaders of the Black Inclusion Group at LinkedIn/Microsoft around what to do to offset the economic disparity arising in Black communities due to COVID.” The group brainstormed ideas for how they could mitigate the negative economic impact landing on Black people.

“The thing we had confidence in was our ability to understand and opine on early-stage technology projects,” he says. The group set out to raise $2M across the roughly 600 Black employees across the company to invest in Black founders from their networks who were struggling as a result of the disproportionate impacts of COVID. “It wasn’t all-encompassing, but it was what we felt comfortable taking action on.”

However, when they started talked to potential contributors, they ran into an obstacle: “99% of the people we talked to were mission-aligned,” Smith says, “but very few had $10-$30k they could put into a venture fund.” And this, of course, is a result of the severe racial wealth gap. As Smith puts it, “There isn’t a lot of equity within our families that we can just all of a sudden let go of $30k.”

This obstacle turned into an opportunity when he began to reflect on his personal relationship to capital. “This was very true for me as well. The single largest holding I had was the Microsoft stock I had, which had nearly 2X’ed in the year-and-a-half I’d been at Microsoft.” He began to wonder how the group could leverage the lead they created for themselves with Microsoft stock options back into the community at large because, in Smith’s words, “Cash wasn’t going to do it.”

Leveraging a Potent Network

It was time to reach out to his people outside of LinkedIn/Microsoft. As a Stanford graduate who played football all four years of undergrad and also spent some time playing for the then Oakland (now Las Vegas) Raiders, Smith has an expansive, formidable, and impactful network.

After reaching out to some former teammates working in credit and banking apparatuses, he ultimately received the validation to move forward with a stock participation instrument from Jesse Rogers, co-Founder of Altamont Capital Partners, a Palo Alto based private equity group. Rogers thought it was a promising opportunity to not only accelerate access to venture as an asset class for Black tech workers, but also establish a new VC operating model that could lead to outsized performance. “So I was in the position where I had a mechanism that could unlock this participation at LinkedIn,” he shares, “but no one had experience running a venture fund, so that was definitely a hurdle.”

His next step was to reach out directly to Reid Hoffman, co-founder of LinkedIn and legendary investor at Greylock, to say, “Hey, the Black employees of LinkedIn are potentially pursuing a venture vehicle. Is this something you’d be interested in supporting?” To Smith’s surprise, Hoffman responded. “He met with me along with the co-leader of the Black Inclusion Group at that time, Eric Abrego, and shared with us for over an hour his perspective on the venture industry.” Hoffman reminded the pair that VC is a very cottage industry and they should only raise money if they know they have access to the very best deals, but he also encouraged them, expressing interest in what seemed to be a promising concept. “That was the a-ha moment that we might be onto something,” Smith says.

The Musa Capital Value Proposition

Musa Capital aims to partner with Black technology workers in Fortune 500 companies to provide a deal sourcing and execution advantage for the fund portfolio, these Black technology workers are in the position to do what they do best, according to Smith: leverage their networks for impact by speaking to people who are building the companies of the future. “We get to leverage this broad ecosystem of Black technology workers who are top-tier professionals,” he elevates. “Either they themselves or folks they’re connected to are going to be generating the next round of B2B solutions, and we get to be first in line.”

Further, the tech workers partnering with Musa Capital are sellers, marketers, and engineers who can offer to founders a unique suite of operational support, through which the platform believes will yield founders an execution advantage, and more consistent performance for portfolio companies due to the operational leverage created by the employee LP pool. “This is a level of execution benefit,” Smith points out, “that few other platforms are able to provide.”

The Musa Strategy

Musa Capital is focused on pre-seed and seed-stage checks ranging between $150K and $500k, with significant reserves of “dry powder” for doubling or tripling down on portfolio companies making the most traction. Their intention is to expand wealth creation for Black technology workers and founders everywhere.

Smith’s team is taking a B2B generalist approach with a clear focus on companies with at least one Black founder and/or companies that are significantly impacting urban environments. “Musa Capital is intended to be a sourcing engine,” Smith shares, “we want to leverage our ecosystem partnerships in addition to our own follow-on reserve to ensure portfolio companies have robust access to future capital as they scale.”

While Musa’s focus is on SaaS, it also looks to healthtech, fintech, sustainability, and technology, media, and telecom, which includes things like the creative economy. “We just want to avoid anything that’s direct to consumer,” Smith explains, “because that’s not where our expertise lies. My background has been almost entirely anchored in go-to-market strategies for B2B companies, and I’m very effective there.”

What Sets Musa Apart

“Being able to pair operators from Fortune 500 companies with founders working through operational challenges who have shared experience in common is very unique,” says Smith, “and the ecosystem we’re building with the fortune 500 employees is a benefit that just hasn’t been offered before. Because of that, we anticipate we’ll have an advantage in terms of deal sourcing and execution.”

“One of the things that’s unique about Musa Capital is that we offer carried interest economics in deals sourced to the fund. The traditional scouting arrangement that puts the onus of diligence entirely on the scout is never going to work for our ecosystem,” Smith states with clarity. “What always bothered me is that a scout sourced an Okta, an Uber, or a Salesforce for a VC, the scout often does not realize any of the outsized value they create for a platform. The way we think about shared economics is that a rising tide lifts all ships. We want scouts to proportionally benefit, which creates an advantage in which scouts are incentivized to scout for us over others because of the carry economics they’re able to access.” This not only benefits the scouts but also grows the Musa Capital network more quickly.

Smith himself possesses countless assets that position him for success in this work, given his understanding of employee resource groups (ERG) in Fortune 500 companies; his go-to-market background in big tech; and remarkably influential network, and a thorough and intimate knowledge of B2B SaaS solutions. “Doing something new is hard,” he says. “You need someone who has a broad network and a thick skin as well as diligence and worth ethic to execute on it. My athletic background and upbringing allow me to bring all these things to the table.”

A Mission-Driven Orientation

“One of the reasons I entered a more mission-driven space is because I didn’t want the opportunities I had to be wasted on me alone; I wanted to leverage them back into the community that birthed me.” With parents who were both Arizona State University professors — one a statistician focusing on race relations and the other a psychologist and sociologist — Smith was raised in an environment that nurtured his curiosity about social conditions and his desire to do something to effect change. “My parents blessed me with a critical mind,” Smith says. “They also anchored in me a strong fundamental value of education and a desire and belief in myself to go out and achieve great things and succeed.”

As one of the very few Black folks in his hometown of Tempe, Arizona — but with deep family roots in the South — Smith underscores the immense value of having educator parents who were committed to Black community.  “Race has been particularly present in my life even though I was raised in a mostly White community. My parents instilled a deep sense of self and race awareness.”

He elevates his understanding that he’s been given more opportunity than the average Black child of his time, and even with that additional access, he says, “It was often still challenging to raise money to pursue my ideas.” This sharpened his priority of investing in teams with Black founders. “Musa Capital created the opportunity for me to take the mission-oriented nature I’ve had since birth and merge it with the race consciousness, skills, and advantages my parents provided me and leverage it all for the betterment of underrepresented communities.”

Participating in the VC Include Fellowship

“In a lot of ways, we started on this journey very naive. I didn’t know much about being a fund manager until I joined VC Include,” Smith says. “The education I was able to get around front office, back office, legal, the different types of LPs and fundraising limitations — all things I’d been learning the hard way over time — was now jam-packed in an ten-week course that allowed me to take more ownership over the platform I was creating.”

He points specifically to the powerful experience of having to produce a video pitch about Musa Capital as part of the fellowship. “Producing the video allowed me to curate a talk track that I credit with helping get to find the first LPs that would believe in my idea.” But it wasn’t just about the assignments and the skills gained; it was also about the people. “The consistent feedback from Rendell, Alia, and Ivy was critical to my development. I saw my evolution, and I’ve learned the fundamentals I needed to have confidence operating as a fiduciary.”

We have the utmost confidence in Smith and his work with Musa Capital, and look forward to the waves of impact they continue to create.