Two HBCU grads have joined forces to make money moves.
Calvin L. Butts, Jr. and Carrington Carter are the founders of East Chop Capital, which seeks to expand access to capital and other resources for Black, women, and minority entrepreneurs, while also building generational wealth for its investors.
Earlier this month, the firm announced that it closed its $4 million inaugural fund. They also are the marketing and management company for their $10 million portfolios for Getaway Society, which specializes in luxury vacation home rentals.
As HBCU grads — alumni of Hampton University — Butts and Carter know better than anyone else that they’re a cut above the rest. However, because of some resistance from the “old boys club” that dominates the world of venture capital, Butts said that East Chop Capital faced their share of headaches when they went for their inaugural fund.
“It was way too difficult and took way too long for us to raise $4 million, considering our experience, work ethic, integrity, our personalities, and the thriving industry that our first fund is focused on,” Butts told AfroTech. “We went door-to-door for two and a half years, meeting with family, friends, and colleagues. We didn’t have any institutional or family office support.”
Carter agrees, and says that their struggles have made them conservative investors — moreso, in fact, than their more adventurous counterparts, because they feared making a mistake.
“As Black fund managers, there’s added pressure to succeed. We grew up always being told that we have to work twice as hard. Sometimes we wonder if we’re acting too conservatively when choosing our investments. We can’t make a mistake, because we may never get another shot with current investors or a fresh start with new investors. In other cultures, failure is more tolerated, as long as you learn from it,” he said. “Working twice as hard for us means delivering both ‘hard ROI’ and ‘soft ROI.’ Calvin and I are always driving ‘off the spreadsheet’ value, first by looking at value differently, then by leveraging our networks and ecosystems. This approach creates additional ‘on the spreadsheet’ returns.”
Now, these HBCU grads are looking to help other businesses through East Chop Capital — but, they say, they’re looking to build both social and financial equity for their lucky recipients.
“We need more ‘I believe in you money’ in the Black community,” said Butts. “We have to get comfortable with investing in people and ideas, and the uncertainty that comes with it. Most of us didn’t inherit wealth, so in order to get comfortable making private investments, you must manage your life and finances in a certain way, which includes having multiple revenue streams and/or living below or at least within your means.”