Founders & Investors: Troy Carter
Back in February we saw yet another celebrity participate in a tech investment, RnB superstar Ne-Yo. He invested in Holberton School and took part in a $2.3m round for the coding school. It is too early to judge whether this is a strong investment that will grow and produce a worthwhile exit for the producer and singer. On a positive note he is joining the board as a trustee with the goal of attracting people from underrepresented groups to learn how to code. Something both Nas and Tristan Walker are contributing to as well with initiatives such as Code2040. Holberton have made it accessible for people from diverse backgrounds by differentiating from other coding schools as there is no fee upfront but rather money deducting from your first three years of working (17%) in order to pay the costs. This sets up an incentive structure whereby it is in their best interest to help successful students get a job after they graduate.
Finding His Niche
This article is about a music mogul but he is not a producer, singer or rapper. It is someone more known for pulling strings behind the scenes, Troy Carter. This article will walk through how Troy discovered and cultivated Lady Gaga for nearly a decade before getting fired to how he has gone on to Co-Founding Cross Culture Ventures (CCV). In between he invested in companies such as Dropbox, Afrostream, Warby Parker, Lyft and Uber with Atom Factory as well as appearing on the hit US show Shark Tank but let’s start by introducing who he is and how he got started.
Troy dropped out of college to the dismay of his mother, only aged 17 in 1990 and like many young men out in Philadelphia he aspired to be a rapper.
No surprise his track on Youtube has 14,000 views by the time of this article. Surprisingly he had the opportunity to demo this track to Jazzy Jeff, Will Smith and their long term manager, James Lassiter. Although Troy didn’t get signed in the 90’s based on his performance, it was a start of his journey in the music business as James took him on as an apprentice and flew him out to work in L.A as a personal assistant. After 5 years he moved back to the East Coast. Forming lasting relationships from here on become one of Troy’s key strengths. In New York he went on to intern for Bad Boy Records for just under two years, working with the likes of The Notorious B.I.G and P Diddy. He then moved back to L.A. to work with James again, barely in his 20’s yet Troy was loving the L.A. lifestyle, a.k.a the sun, parties and girls. The lifestyle was actually costing him a fortune in expenses as he was renting cars to live the fast life and when James found out he was soon sacked by James as a result.
Lessons from Philly
Feeling dejected and with financial woes on his back, Troy returned to Philly back where he started but unsure what his next step would be. Two things were apparent though, from his experience he knew:
a) he was not destined to become a rap sensation
b) he admired artist management
Growing up in urban areas such as Philly means there are certain ‘codes of conduct’ you live by, like loyalty and having a sense of family like relationship with friends. Eve was a friend like that to Troy, so when she reached out to him looking for help on finding a manager, he took on the challenge himself. Immediately he felt like a steward and a protector to some degree as if Eve was his younger sister. This sense of investment on his side played to his strength and her best interests as he was always looking out for her in deals and negotiations.
In terms of achievements, what was quite unique about Troy’s management of Eve is that she was not only an Grammy award winning rapper but she transcended rap to act in films such as Barbershop and her on hit TV show named after herself. In 2004 after all this he sold his management company to British owned Sancturay records, earning him over $2m in the deal. This of course is a life changing amount but after buying a house with his wife, taxes and investing into his new company he was back on his bottom in Philly again. To make matters worse Eve decided to part ways with her long time friend Troy. The deal with Sancturay went sour and Troy’s car was repossessed whilst the financial crises of 2007–08 took his house for ransom too. However in these difficult moments when backed into a corner, Troy reverted back to his hustling roots from Philly and had to maneuver out of this position leveraging his relationships and expertise in management.
From Music to Startups
Facing eviction from his home, record producer Vincent Herbert, who had just left Universal Records, introduced Troy to a new client, then-unknown and dropped from Def Jam, Lady Gaga. She was in a desperate state at the time as her father allowed her to use only 1 year out of college to explore a career in music. The experience managing Lady Gaga exposed Troy Carter to the rift and opportunity that existed between music and technology. Like Chamillionaire he built a direct to consumer relationship globally leveraging tech, specifically social media such as Twitter and Youtube to build Lady Gaga’s cult following. He went on to manage other successful artists such as John Legend and John Mayer. Troy built his network out in Silicon Valley and began to be invited to sit on boards before trying his hand at investing himself. He took on the role of Head of Creator Services at Spotify in June, 2016 in a bid to battle other rising streaming services from Apple, Soundcloud and Tide. To date he has over 100 investments under his belt including Uber, Lyft, Dropbox and Warby Parker. I don’t think he will be returning broke to Philly for a third time any time soon.
In 2016 he founded Cross Culture Ventures (CCV) alongside his investment team which includes Marlon Nichols, Trevor Thomas and Suzy Ryoo. The diversity of team ranges from experiences in branding, music, angel investing and marketing. I love their motto, “Our diverse skill set is a key asset and major differentiator.” The resiliency and tenacity Troy has shown throughout his career is the same attributes he looks for within his founders. CCV focus on cultural shifts when assessing early stage startups, investing up to $500k. Shifts such as the fact that the minority will be the majority of the US population by 2040, this creates compelling opportunities for founders as demonstrated by Tristan Walker with Bevel. For example CCV have invested in Nairobi based mSurvey, looking at diverse communities and founders beyond US borders. Another of their investments is Oakland born Mayvenn, which is a mobile platform aimed at black stylists and salon owners in the US.
Remember less than 1% of VC backed startups are black-owned, which demonstrates why we need investors such as Troy Carter to help bring a diversity of thought to the market and improve tech inclusion.
QUICK PLUG: My inspiration is my mother, she became an entrepreneur at age 60, but she needs our help. She is raising funds to buy a shuttle bus to support low-income families in picking up their children for Nursery in Ghana. Check it out here: https://www.gofundme.com/juliets-nursery-mini-bus-campaign