So when I say “NASCAR” to you, what do you think of? Probably a bunch of good ‘ol boys flying confederate flags, drinking beer, and whooping as stock cars go whizzing by. In the past, this image would have been fairly accurate. However, times are changing. The product managers at NASCAR have realized that the world that we are all living in is in the midst of some very large changes and because of this, they are in the process of trying to reinvent what NASCAR is and just exactly who it appeals to.
Changes Come To NASCAR
The NASCAR product managers are hoping that the Next Gen, a racecar tasked with something more than just going fast, will be able to change NASCAR’s fortunes, to bring back classic stock car thrills and reverse more than a decade of fan loss. They are also hoping that the new car can change NASCAR’s culture, to attract racially diverse team owners and team members and the younger multicultural fans that their advertisers crave.
NASCAR is in a difficult position. Its initial economic clout grew out of its appeal to white working-class fans. By the 1990s, their largely white, right-leaning audience became an economic and political force that was known as the “NASCAR Nation”. This group was valued as the most brand-loyal consumers in all of sports. The problem that the NASCAR product managers are facing is that fans warmly nostalgic for Old Dixie are aging out. Going forward, the challenge faced by NASCAR’s product managers is to appeal to a new audience without alienating their old one, even as it seeks to distance itself from some of what that old audience held dear. The league’s strategy is all rolled up into the Next Gen car. They will try to pay homage to the past while outrunning it at the same time. Honoring the past, the new car looks like a stock vehicle and is designed to “put the ‘stock’ back in stockcar,” as the NASCAR product managers like to say. Anticipating the future, it has the ability to be converted to electric power.
Billions ride on the new plan. NASCAR is due to enter negotiations for its broadcast rights, which in the past brought an estimated $8 billion over 10 years. Delivering diverse viewers has become a multibillion-dollar marketing imperative. The challenge is that even devoted fans sometimes have griped that racing has grown dull, partly owing to the cars being raced. In response to the crash that killed the racing legend Dale Earnhardt back in 2001, the NASCAR product managers have developed the fifth-generation “car of the future” with an eye toward safety. It was called “the flying brick,” in part for its generic appearance. The next car that was created, Gen 6, looked more like a street car but turned out to be more costly than Gen 5, meaning fewer teams could afford winning cars. It was anticipated that the leaders would get out front early and stay out front.
The Next Gen car addresses these problems in a couple of ways. First, the cars will look more like stock street cars, recalling a time back when rules said that manufacturers had to sell the public at least 500 of a particular car for it to qualify it for racing. Manufacturers say fans bond closely with a brand the more its racecar resembles what’s in their driveway. Next Gen will also more mechanically resemble street cars that people can purchase. NASCAR is replacing arcane technology, like an antiquated solid axle rear suspension with the independent rear suspension that is found in modern cars. Fans like to see aggressive physical contact between cars, which the Next Gen car is made to absorb. The composite body is built to take a lot more abuse, so from the bumpin’ and bangin’. Other changes should increase the car’s passing ability, which will be viewed by including more in-car cameras. New sensors will generate more statistics to be processed by stats obsessed fans.
It’s All About Culture Change
The goal of introducing the Next Gen’s car is to change NASCAR’s culture. One way that the product managers hope to make this happen is by lowering costs, the league says this will allow for new owners. Additionally, teams will be limited to having just a seven-car fleet. Previously, with different cars for each kind of track including dirt track, short oval, and road course some teams were said to have a fleet of more than 40 cars. In the past each team manufactured its own parts. The Next Gen cars will all get most of the parts that they use, from chassis to gas tanks, from the same list of specified shops.
The goal of the NASCAR product managers is to use Next Gen to reduce the ownership cost by 25 to 40 percent. This should help to level the playing field. In the past as the sport grew in popularity it attracted a lot of cash. It became an engineering arms race between the different teams. Success in the sport was determined largely by how much money, tech and support the sponsors could provide. The hope of the NASCAR product managers is that lowering costs can make it easier to attract new team owners. The result of this should be increased diversity in car team management.
Increased minority participation can give the league a new narrative that highlights its inclusiveness. And that narrative is very, very important to NASCAR. Research shows that car racing storytelling is a top reason fans tune in to watch the sport. No matter if it is the competition, or a wreck, or two cars fighting out for the lead week after week. What may be different now is that NASCAR fans themselves appear ready for a change. A survey measured attitudes toward social justice issues among 1,075 respondents, including 467 NASCAR fans. The Confederate flag ban that NASCAR implemented was supported “somewhat” or “very much” by 60 percent of the general population, but by 80 percent of both African Americans and NASCAR fans.
What All Of This Means For YouWhen it comes to car racing, NASCAR has always been the organization that has been able to put on a well-attended race. However, times are changing, and the NASCAR product managers realize that what may have worked in the past is not going to work in the future. The NASCAR product managers need to find a way to diversity their team owners, their teams, and as a result their customers. What they need, is a pit stop. One way that the NASCAR product managers are hoping to capture a new fan base is by introducing the Next Gen version of their racing car. The traditional fan base for NASCAR sponsored races is starting to get old and die out. This means that a new fan base is going to have to be cultivated. Racing has become dull and predictable. The new car is designed to fix this. It will permit more cameras to capture the action. It will also more closely resemble the types of cars that people can purchase. The goal is to attract more diverse car owners and the fans that want to follow them. The new car should make it less expensive to be a car owner. Car racing is all about the stories that people like to listen to. Social justice is very important to the new collection of fans that the NASCAR product managers want to attract. The good news is that the NASCAR product managers have realized that change needs to happen. Instead of sitting around while their fan base gets smaller and smaller, they are taking action to try to reinvent themselves. If their plans to introduce a new style of racing car works to attract more diverse car owners, then they may have found the winning formula. We’ll just have to sit back and see how this race turns out.
Question For You: How could the NASCAR product managers make coming to a race more attractive for a more diverse fan base?
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What We’ll Be Talking About Next Time
There’s no question that streaming services are very hot right now. No matter if you are talking about Netflix, Hulu, Disney+, Amazon Prime, or any one of a number of other services, people seem to be signing up for these new services in droves. Sure would be good to be a product manager for one of them. However, it turns out that there is a downside to this job. People sign up very quickly, but then they seem to also leave very quickly. What’s going on here?
The U.K.’s Treasury Select Committee last month released a report on the diversity — or lack thereof — of the nation’s venture ecosystem. Black founders there receive less than 0.4% of all venture capital, and women founders receive around 2%, the report found.
The report called such dismal stats “unacceptable.”
Venture capital firms are dominated overwhelmingly by white men and the receipts of venture capital funding are even more unrepresentative of the wider U.K. population in terms of gender and ethnicity. While there have been some improvements, it is happening far too slowly and affecting rapid change should be viewed as a priority by government and industry.
And it’s not just in the U.K. In the U.S., funding to Black founders in H1 fell 40% from a year earlier — of the $75 billion invested in the first six months of 2023, just $565 million was raised by Black founders. And women in the U.S. consistently raise just 2% of funds allocated in any given year. As TechCrunch+ has frequently reported, firms and investors have taken only a few steps to create a more equitable landscape, but financial incentivization and a push from the government could help them go all the way.
Brandon Brooks, a founding partner at Overlooked Ventures, said venture capital is already on the minds of many lawmakers in Washington. He said he was summoned to a hearing in April to discuss the U.S.’ venture capital landscape.
Senators took an interest in the sector after the collapse of Silicon Valley Bank in March, looking to find more ways to impose regulation. During the hearing, some senators had qualms with the lack of funding and opportunities going to their own constituents. “Now that it’s been brought to their attention in a very public way, they’re going to start taking action,” Brooks said of how policymakers are now showing more interest in the industry. “We can now use [the U.K.] report as a guideline to say, ‘let’s do something similar in the U.S.’”
Ladi Greenstreet, the CEO at Diversity VC, was one of the many summoned by the Treasury Select Committee to share his experiences in the U.K. venture ecosystem. The Treasury had already responded to the report, saying it would consider the suggestions of its select committee. “But at the end of the day, it’s politics, so I can understand that a whole bunch of other things must happen for this to be put through,” Greenstreet told TechCrunch+.
Materials Nexus, a deep tech AI and quantum mechanic company, announced Wednesday the close of a £2 million seed round led by Ada Ventures. The National Security Innovation Fund, The University of Cambridge, as well as angel investors Andrew MacKay and Jasmin Thomas also participated in the round.
The company, which was founded in 2020 and based in the U.K., seeks to amplify zero-net technologies, including renewable energy generation and energy storage, in a way that gives higher performance and sustainability at lower costs.
CEO and co-founder Jonathan Bean, a theoretical physicist from the University of Cambridge, and his team worked for the past two years on an AI model that reduces the need to conduct physical tests to discover new materials. This allowed them to build their own datasets and algorithms, accelerating the discovery time, meaning that products could be pushed to the market faster. Materials Nexus works with businesses of all sizes to discover materials that can later be patented, and it hopes to one day build a facility to produce materials to then sell to large companies, like an equipment manufacturer.
Bean says the company plans to use the money to scale its commercial and scientific operations. It’s also hoping to prove the effectiveness of its technology, finding alternatives to materials that are already used in products such as semiconductors and batteries to help innovations like wind turbines and electric cars scale more rapidly and sustainably. In the midst of the AI craze, Bean described his fundraising efforts as “quite fun.”
Bean started looking for capital in October 2022, and said he got a term sheet within five months.
Matt Pennycard, a co-founding partner at Ada Ventures, called Jonathan a “remarkable technical founder and company leader.” “He’s a needle in the haystack that we VCs spend years searching for,” Pennycard told TechCrunch, adding that the company is also an exemplar of using technology for good. “Our strong bet is that Materials Nexus has the potential to play a very significant role in our fight against climate change and be the solution to the damaging addiction to rare earths and unique metal compounds we’ve built.”
With this raise, Bean joins a rare club in the U.K.: the handful of Black people who have been able to raise money. The last official numbers were released in 2020, and it estimated that only around 40 Black founders had ever raised in the U.K., picking up less than 0.4% of venture capital funding in the nation.
Climate change in the U.K. has become a pressing matter, and having diverse perspectives on the issue is imperative for achieving true environmental reform. Bean said he went through the Cambridge database to find people who had experience in materials engineering and called up alumni, asking questions and trying to understand the market.
Bean says his dream is to one day set up operations in the U.S. But for now, there is much work to do in the U.K. After all, someone has to help trail-blaze the “Unicorn Kingdom.”
She will be the fund’s first female partner and will also focus time on building Cornerstone’s mentoring practice to support the founders within the fund’s portfolio. As an investor, Wales Bonner tells TechCrunch she’s interested in consumer products, or “essentially any product or platform that everyday people can use,” she said.
Previously Wales Bonner worked at JamJar Investments and M&C Saatchi and has a history of hosting events for diverse founders within the U.K.’s venture landscape. She believes it’s important for a woman of color like her to be visible in the industry so other underrepresented groups know there is space for them.
“When you don’t have those ties into VC, it can be hugely valuable to get an insider’s view on what can be a pretty opaque industry,” she said. “The more we can help open doors for others, the more this industry will better represent society.”
Cornerstone’s diversity-led thesis is greatly needed in the U.K., where there has been an increased push to back more startups founded by women and people of color. For example, the latest figures show that Black British founders raised 0.25% of all funding in 2020. Women are faring better: all-female-led companies raised 6% of all venture funding last year in the U.K., compared to around 2% in the U.S.
Wales Bonner’s appointment is also important as more women of color rise through the ranks of venture. She joins Cornerstone at a key moment, with the wider venture market still in the midst of a downturn. Wales Bonner said the fund is still in the early stages, so it is less exposed to inflated valuations as it has yet to deploy vast amounts of capital. Still, she sees this moment as a great opportunity.
“The change in the market means we can spend more time getting to know founders through our investment process,” she said. “We are a people-first fund, so having time to foster strong relationships with our portfolio is really important to us.”
Cornerstone invests in pre-seed and seed rounds, with average check sizes ranging from £250,000 to £1 million. It is currently investing out of its £20 million fund, which closed in August of last year. It plans to back up to 40 companies, reserving 40% of the capital for follow-on investments.
Wales Bonner is overall excited about this next phase of life. The U.K. is going through a cost-of-living crisis, plunging many consumers and businesses into uncertainty and changing how people think about their work and lives. People want balance and fulfilment, she said.
“I am still hopeful we will see a new wave of brilliant businesses being born out of the need for change.”
This story was updated to reflect Wales Bonner’s full name.
Cornerstone VC hires Ella Wales Bonner as first female partner by Dominic-Madori Davis originally published on TechCrunch
Bridge 2 Technologies began with the notion that it should be easier for companies to find a diverse set of vendors. The company formed three years ago with the idea of bringing these two groups together in a two-way marketplace.
Today, the company announced the official launch of the Bridge 2 Technologies vendor marketplace with around 500 corporations and 3000 vendors on an AI-fueled platform. It had been in beta for a couple of years.
Founder and CEO Eric Kelly says that he has been working to bring people together for years, but at a diversity conference a few years ago, he became enamored with the idea of creating a digital platform where corporations could find a curated set of diverse vendors.
It’s really about networking and communications. “If Slack and LinkedIn had a baby this is what it would look like,” Kelly told TechCrunch, but the platform was built with a focus on finding diverse vendors. “It really was the development efforts of the large corporations, the diverse companies, the leaders in that industry, saying what are the things that we need to do to actually connect everyone together,” he said.
Kelly said the idea for the platform was born at a one-day conference in New York a few years ago, which brought together corporate leaders and the leaders from diverse companies. It went so well, they wanted a way to keep these groups connected.
“As we talked about it, [the participants] said we don’t have a way of connecting in a meaningful way to find the corporations that are ready to scale, finding the talent. And so I raised my hand and said, ‘OK guys, I’ll build a platform if you help me build the ecosystem.’ And that’s how it started,” Kelly recalled.
While many companies such as government contractors have a mandate to work with a diverse group of vendors, it’s often a challenge to find and vet them. That’s why it was goal for the platform to be highly curated, so that the corporations looking for vendors would be working with a set of companies that have passed some sort of diversity certification from a vendor perspective, and can handle the needs of a large corporation.
“So that’s why it’s invitation-only. So when they go to the platform, they know that company has already been curated either by them or by one of the large certification bodies that they’ve already done business with,” Kelly said.
The plan was originally to launch with just 250 vendors, but they are actually launching today with over 3000. Kelly said they took a very deliberate approach to building the platform, not taking any venture capital, so that they could take their time and get it right before launching.
The AI on the backend helps deliver the right content to the right person or company, while translating and taking care of other tasks that can make the platform easier to use.
While the platform is intended to help companies find diverse vendors, an altruistic goal to be sure, it’s still a for-profit venture, says Kelly. As such, both vendors and corporations pay for the privilege of being on the platform, driving revenue from both sides of the house. Pricing is still being worked out.
Bridge 2 Technologies is making it easier for companies to find diverse vendors by Ron Miller originally published on TechCrunch
Smaller venture funds are finding a way to manage in the midst of a conservative market.
As with all bear markets, the appetite for risk drops, and although emerging fund managers are often noted to outperform their more established counterparts, some limited partners are weary of bringing on new venture partners. Instead, they retreat to their trusted, established partners.
For some emerging managers, this means the market will become tougher to penetrate. For those with funds that are focused on backing diverse founders who are already working with less capital, the drawback is often the difference between another round or closing shop.
“Risk is also sometimes perceived as anything outside the status quo,” Madeline Darcy, a managing partner at Kaya Ventures, told TechCrunch+. “The pattern-matching we often speak about for founders and young hoodie-wearing Stanford drop-outs has an equivalent in the VC world in the form of spin-outs from large big-named funds who tend to have less diverse teams.”
B. Pagles Minor, a first-time fund manager who launched DVRGNT Ventures seven months ago, told TechCrunch+ the fundraising environment hasn’t necessarily been a walk in the park. They are seeing an increased emphasis on due diligence, with limited partners asking for more metrics and data than Minor expected. Some of these requests have been costly, too.
“For example, certain types of insurances that were not typical before are now being asked for, placing a financial burden on emerging managers who may struggle to afford them,” Minor said. Minor has also noticed a growing trend of limited partners asking to forgo certain management fees or asking for lower carry in the fund, adding more strain on a fund manager’s ability to build and operate the fund, they said.
What happens to the smaller VC firms in a more conservative market? by Dominic-Madori Davis originally published on TechCrunch