Meet Wendal.
He’s a green and navy blue robot. He’s also an artificial intelligence platform that has helped Covington venture capital firm Connetic Ventures fund 58 percent women- and minority-led firms since its inception in April 2019.
“We believe the pitch is broken,” said Kim Banham, principal of early-stage investments at Connetic. “We use Wendal as part of our diligence and to take a data approach to investing and take out the bias”
Banham and Connetic partner Chris Hjelm sat down in one of the brick-walled rooms in their office along Madison Avenue, which also has a full bourbon bar and a burgundy-walled meeting room with arcade games. It’s a space that seems perfect for fostering a bot named Wendal – one of only a handful of similar platforms in the United States.
“Traditional venture funds are made up of a lot of wealthy people who put money together,” Hjelm said. “(Startups) pitch an idea to a group of mostly white men. That’s obviously evolved a lot.”
A quarter mile walk down Madison and then Pike Street brings us to Aviatra.
The accelerator for women-owned businesses started with its first cohort in 2010. Since then it has served almost 3,000 and, by CEO Nancy Aichholz’s estimation, has created 15,000 jobs.
“The reason that there needs to be an accelerator that focuses solely on women is that women are still not getting the money that our male counterparts are getting,” Aichholz said.
So what is it about Covington that has created an ecosystem where support of women and minority owned businesses has become a priority?
Connetic and Aviatra are two very different companies – Aviatra funds small businesses and helps connect them to resources and funders in the area; Connetic does mostly technology investments for companies that can be sold for more than $100 million. But both are fostering an environment where investing in women- and minority-led companies is not just a talking point.
Aviatra moved into its current location in 2016, and since then, Aichholz said, the organization has boomed.
“Between having the space in general and having the connections with the entrepreneurial ecosystem,” Aichholz said, “is the relationship we have had with the City of Covington.”
The city, she said, is very good at bringing businesses together that are going to be supportive of each other.
“You’ve got your bar and restaurant right around the corner,” Aichholz said. “You have a brewery with a party room and then you have a bakery. Then you have a lot of businesses like ours that aren’t retail but we are certainly serving the community. It’s been a really great place to do business for us.”
Connetic Ventures founder Brad Zapp is from Northern Kentucky; so are Banham and Hjelm.
“Startups weren’t a thing here 10 years ago,” Hjelm said. “It’s been interesting seeing the evolution of venture.”
But, Hjelm said, “for this ecosystem to get bigger and better, you do need more investors and investor capital.”
Enter Wendal.
Firms looking for capital create a profile and answer a series of questions about their startup and themselves. It’s surprisingly simple (and this is coming from the author, who has only ever worked in journalism). It’s also fun to fill out.
One question asks, “Why is your company great?”
Among the possible answers? “Great? It’s bad to the bone.” Another option is “It catches evil villains.”
But more importantly, Wendal gives Connetic a much better idea of the firm they are working with and the person or people behind it much earlier in the process.
And, perhaps most importantly: It removes the bias.
If Connetic is interested in a firm based on Wendal’s assessment, they will set up a phone call.
“I am going to dive much deeper into the questions than a traditional pitch,” Banham said. “Through the initial call we are probably where most VCs are by the third or fourth all I would say.”
Kristina Jones founded Guardian Lane, an online community for kids who have lost a loved one. It brings kids together through art, music and other projects and activities.
Jones’ father died when she was 7, and she said she never really processed what happened.
“I really saw an opportunity to be able to create this place where families and children who are going through really tough life moments can find healing,” Jones said.
Of course, once she had the idea, she needed to find someone to fund it.
“A lot of the funds say they are trying to bring in more diverse founders,” Jones said. “But there is still bias.”
With Wendal, Jones said, it’s nice that they have no clue who is pitching.
“I think for founders who are struggling because they are up against biases whether you’re a woman or a minority,” she said, “I think it’s an even playing field.”
