African Americans and Latinos make up a shockingly low 2% of senior partners at the nation’s top venture capital firms. So what happens when a self-possessed, 23-year-old who doesn’t look like most in the industry wants to join these ranks? He decides he wants to do things a little differently.
"There’s a lot of bros funding bros, and it’s really kind of off-putting," says John Henry.
Henry, whose parents immigrated from the Dominican Republic, is the founder behind Cofound Harlem, a nine-month startup incubator in the gentrifying, culturally diverse Upper Manhattan neighborhood.
Cofound Harlem takes no equity in the companies it supports. It offers office space, mentorship, services, and $50,000 of funding. All it asks in return is that the businesses stay in Harlem for at least four years. Though Cofound Harlem was new and Henry was mostly unknown, in its first class, the social good venture attracted mentors, corporate partners, and board members from the ranks of big players like Google, the NYC mayor’s office, Amazon Web Services, and NBC Universal. In January, it graduated its first class of four companies. Now Henry is working to launch a companion Harlem-based venture capital fund that he hopes will cultivate many more local startups.
It might seem audacious for someone Henry’s age to be coaching other entrepreneurs who are often older than him. Yet Henry’s vision of making Harlem one of the nation’s most diverse startup hubs and paving the way for other urban renewal projects is rooted in his own experience.
Superficially, his story echoes the archetypal startup success tale. College dropout: check. Selling his company just as he could legally drink: check. Impossibly confident male: check.
But it diverges from there. His mother was a custodian, his father worked at a dry cleaner; they never went to college. He didn’t drop out from Harvard or Stanford—he dropped out from the Borough of Manhattan Community College. He never participated in a hackathon (though he has now judged several), didn't stumble across a world-changing idea, and wouldn’t know how to code an app to save his life.
Henry never thought he’d launch a startup. It never occurred to him because there weren’t role models in his community. When Henry moved from Florida to New York after finishing high school, he was seeking fame, not fortune. "My goal was to become the world’s greatest jazz musician," he says. But first he started at community college and supported himself as a doorman, initially at a ritzy Wall Street condo and then at a building in Brooklyn.
His success in business was a combination of chance, talent, and hustle. Henry is a friendly, enthusiastic, hard-working guy, and in Brooklyn, he got to know many well-connected residents in the neighborhood. One who owned a laundry business and decided to offer Henry an opportunity: He said Henry could use his facilities at wholesale rates without the wholesale volumes—all Henry had to do was find the customers.
Henry, then just 18, took the offer and developed a smart strategy of trying to market to fellow doormen, who might send residents in their buildings to Henry’s cleaning service. He also got another break: A resident in his building involved in New York’s growing TV and film industry connected him to the wardrobe supervisor for the Wolf of Wall Street. No cleaning business was really serving the erratic, demanding schedule of film shoots. Some two months later, Henry could brag that he was Leonardo DiCaprio’s dry cleaner.
"I didn’t know what the hell I was talking about, and that might have been obvious," says Henry. "But I think I said, "look man, I promise you I'm going to work harder than anyone." (It was not a moment too soon, he was fired from his doorman gig around the same time.)
Quickly other film and TV gigs followed, including Boardwalk Empire, Law and Order, and the movie Annie. From his Harlem headquarters, as John Henry Cleaners grew, he hired about a dozen employees, including a chief technology officer who helped him launch an on-demand app providing laundry pick-up and other home services to the underserved Upper Manhattan market. That's when another company in the cleaning business made an acquisition offer. Henry took the deal for an undisclosed sum that he describes as "modest"—but still enough to move his parents to a better house and give him plenty of options.
Henry had bootstrapped the whole operation from start to finish. He was 21. The question was: What’s next?
Jeff Livingston, an executive at McGraw Hill Education, CEO of EdSolutions, and a veteran of Silicon Valley, is a board member of Cofound Harlem who lives in the neighborhood. He thinks Cofound Harlem has the potential to expand Harlem’s base of economic development and make New York City’s broader startup community more diverse.
"The inside of startups do not look like the outside of the building in the most diverse city in the world," he says. "It doesn’t take a very long walk through the halls of a WeWork anywhere in the city to [realize that]." The fundamental problem, he says, is that startup are the products of specific networks—and those networks are usually run by white men. "People have a natural affinity for those who look like them and have a shared background," he says. "You don’t even have to try very hard to build diversity if you just change the setting."
This has been Cofound Harlem’s experience.
Around them in Harlem, Henry and his business colleagues saw a thriving and growing local economy with many small business owners, but one that had no startups to speak of in the tech industry’s sense of the word. It was not for lack of trying—there was a small trail of dead incubators behind them. One mistake that these programs made, Henry observed, was that they limited themselves too much—entrepreneurs had to be minorities and they also had to be from Harlem.
Over the time he boostrapped his business, Henry had fallen in love with Harlem. He also realized the value of having connections and role models. He contrasts the experience of working as a doorman in Wall Street—where money was "old and white" and unattainable—to Brooklyn, where he met more diverse upper class people who were professional authors, filmmakers, and rock climbers.
"It was the first time it dawned me on that you could make a living—and a good one—doing exactly what you loved with no compromises."
He and two friends and colleagues, Ahishar Maxima and Evan Dudla, decided to launch Cofound Harlem with some of the windfall from the acquisition. They opened up the application to anyone from anywhere and about 100 flooded in. Henry learned another crucial lesson: Their own diverse backgrounds helped naturally encourage diversity, even if not specifically requiring it. (The two other co-founders are no longer involved in the project).
They signed on four companies, deciding to "bet on teams, not ideas." Bandhub was an online music collaboration service; Reveu.Me, a marketplace for photographers; Localterian, a home-cooked meal delivery service; and Perqy, an HR benefits platform. Of the dozen founders involved in these businesses, 75% were from non-white backgrounds—immigrants, first-generation kids, and people of color from all over.
Of the four business, one—Localterian—already shut its doors. Perqy is the most interesting story. The team, Zoltan Szalas, Dave Idell, Nisha Garigarn, and Adam Chew, participated in a TechCrunch hackathon shortly after starting the Cofound Harlem program and came up with the idea for Croissant, a subscription service for seats at different co-working spaces around the city. The founders decided to pivot, and Cofound Harlem’s advisors helped them find their new footing. Today they say they have a few hundred paid users and are growing 10% a week.
Szalas says the diversity of backgrounds they encountered at Cofound Harlem was helpful in breaking that homogenous mindset: "It’s very important, when it comes to providing a service, that not everyone’s the same."
Henry’s team is now regrouping to think about how the second class will take shape. The incubator can’t just rely on his personal funds, so he’ll need some new business model or more donors. Right now, he says it will continue to be more of a social impact and economic development project than a for-profit, exploring a partnership with local community development organizations.
He’s also looking to a launch some kind of venture capital division, one that would take a hybrid social impact and business approach, possibly similar to firms like Village Capital. "It’s possible to do well and do good at the same time," he says. His goal is ultimately to cultivate dozens of growth businesses in Harlem. Ultimately, of course, some will fail. But even when they do, they might just provide the opportunity that youth in the area need to get involved in something they might never have thought possible.
Livingston is impressed with Henry’s sophistication, focus, and passion. But every once in awhile he gets carried away: "You can see his mind running a million miles an hour. [Henry’s] bias is always towards action, and you want to be like, just slow down, think about where you’re going for a second. And then you’re like, oh yeah, he’s 23."
All Photos: Cofound Harlem