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Q: What attracted you to PE?
Reginald Binford Jr.: Ownership. I’ve always felt ownership
matters. I worked in banking, so I helped people get into ownership
positions and helped businesses take over other businesses.
I’ve seen how ownership allows you to drive a business in a way
that aligns with your values while also effectively managing
shareholder expectations. Ownership now gives me the opportunity to
drive diversity and other aspects of running a business that are
meaningful to me while also allowing me to generate shareholder
value for my investors.
Q: What is a goal that you have set for yourself for the near
future?
RB: One of the biggest goals I’ve set for
myself is to better ensure I have diversity in the boards I put
together and on the management teams within my business. Although
diversity is very important to me, I find that I’m not pulling
my weight as it relates to diversifying the boards and management
teams where I can place people.
To achieve this goal requires that I work to establish
connections to various groups to better ensure I find and bring on
quality board members for these businesses.
Q: What do you think is the biggest challenge facing Black
entrepreneurs? What advice would you provide to overcome it?
RB: I think the biggest challenge facing Black
entrepreneurs, and there have been studies around this, is the
funding gap. This gap has several contributing factors, including
Black entrepreneurs lacking the networks and connections to all the
funding sources that exist and can help drive and grow a business
as well as understanding the value of the different sources of
financing available. The Black community has frequently been told
that debt is bad, which is not always true. We also haven’t at
times fully understood or appreciated the value of new equity
partners.
One of the first pieces of advice I would give to overcome the
funding gap that can hold back Black businesses is to learn about
the different forms of capital available and understand how they
align with your business’s growth strategy. For example, you
want to learn about when equity is important and when debt is
important.
My next piece of advice is to go out and talk to different
capital providers. A lot of capital sources are looking for deals.
Put yourself out there. Reach out to these people and start many
conversations. That should help drive capital to you and deliver
the best terms.
This is just the start. We must be prepared to provide education
to capital sources about Black businesses and opportunities. This
should include citing studies that show strong returns often
associated with not just with Black entrepreneurs, but all
entrepreneurs of color.
Q: How do you believe Black professionals will be able to
influence the PE industry?
RB: I think the biggest influence will be our
experiences — sharing our observations, how we’ve been
affected by decisions and our perspective on problems. This
isn’t just important for Black professionals, but all
professionals with different diversity and backgrounds.
I think by having diversity of thought in a room, you can better
envision different outcomes and achieve better returns. The more
overall diversity of thought we can get into PE, the better.
When I think about my investment team, I know it’s important
to have diverse people in the room who can talk about their
experiences and thoughts and explain how they manage and see
problems, whether they are sharing stories from their family
businesses or what they went through in business school. I believe
conversations that make us look at and consider things differently
will help drive stronger returns in the long run.
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