Black Lives Matter: How Entrepreneurship Shaped Generations of Freedom and Autonomy

“Life is a series of remembered stories. 

For black lives to matter, their stories must matter. For their stories to matter, they must be evoked, listened to, heard, understood with compassion, valued as the unique expression of the human spirit that each story is.”

Daryn Dodson, by resume, is living the life of a high-performing business leader from an African American family of professionals who would expect nothing less. Born and raised in Washington, D.C., Daryn graduated from Georgetown Day School, Duke University (AB, 2002) and Stanford Graduate School of Business (MBA, 2007).

Illumen Capital: Striving for Racial Justice through Reducing Implicit Bias in Finance and Investment

The first thing Daryn offers to anyone he meets is a warm, inviting smile and an easy laugh. Hailing from a long line of entrepreneurs, Daryn launched Illumen Capital four years ago after observing that the vast majority of investments were underperforming because of racial and gender bias. And bias in investing perpetuates inequality across other systems, including education, healthcare and criminal justice.

“To prove my thesis, I partnered with Stanford SPARQ (Social Psychological Answers to Real World Questions) and interviewed 180 fund managers to assess their bias when evaluating Black and White-led firms,” Dodson said. The study, published in the Proceedings of the National Academy of Sciences, found that despite identical track records, as performance increased, Black managers faced more severe biases when compared to their white counterparts. Dodson added “In other words, investors would systematically leave money on the table before investing in Black-led firms. So the penalty for success has metastasized within the asset management business, whether that is in hiring, board selection or investment decision making.”

As a response, Daryn launched Illumen Capital, a private equity, venture and growth impact fund of funds that provides much more than capital: the firm delivers evidence-based bias-reduction training and coaching to its portfolio of fund managers throughout the life of each investment, a journey intended to last 10 years. Illumen Capital’s Limited Partners – including family offices, financial institutions, and foundations – gain access to investment funds led by Black, Latinx, and women managers, along with others committed to reducing the implicit bias that dominates the world of finance and investing.

Before starting Illumen, Daryn worked with a pioneer of socially responsible investing, Calvert Funds, an over $15 billion portfolio of ESG (Environmental, Social, Governance) and thematic investments. Daryn led private equity at Calvert Funds as a consultant to the Board of Directors. Prior to Calvert, Daryn served as Director of University and Corporate Partnerships for The Idea Village, where he created a platform engaging leading private equity firms, business schools, and Fortune 500 companies to invest over 100,000 hours and $2 million into more than 1,000 New Orleans entrepreneurs post-Hurricane Katrina.

Slavery to Freedom to Entrepreneurship in One Generation

“My name is Stanton Hunton and I own the Hunton block on William street at King. My building is a two-story brick structure with three stores on the ground floor.” Excerpt from Daryn’s great, great, great grandfather’s diary:

“My great, great, great grandfather, Stanton Hunton, was born a slave in 1815 in Virginia. He escaped from slavery four times and was captured three times. In the year 1840, he finally became a free man by crossing the US border to Chatham, Ontario, Canada. After reaching Chatham, he went back to get his brother, Ben, from Mississippi who would die soon after, a free man. In Ontario, Stanton would meet with John Brown, who, at his kitchen table, planned with him the raid on Harpers Ferry. Stanton managed to build a successful cobbler’s shop as an entrepreneur and eventually owned a block of real estate in Chatham, on the main street. He started a legacy of personal autonomy through entrepreneurship that would endure until my generation.”

Daryn often looks to his parents, Helen and Norris A. Dodson III, and grandparents for inspiration. 

“My grandmother, Bertha McMurdock, helped integrate the schools in Washington, D.C. and lived to 102,” Dodson shared. In the same way that his grandmother integrated the schools, Daryn is working to integrate the field of finance. 

“My great grandfather, Norris Augustus Dodson Sr, graduated from Phillips Exeter Academy, went to the University of Michigan and then became an entrepreneur, because he was a chemist and there were no jobs for black chemists. So he said, in 1911, ‘I'm either going to go into Black hair because that takes chemistry and is a big market because white companies won't provide solutions for Black hair, or I'll go into Black food because there are ingredient mixes that are chemically based, or I’ll go into Black embalming fluid, because I know that many white people who believe in segregation in life, also believed in segregation in death. And the market was stable for embalming fluid, so he built a company that my grandfather and his brother ran their entire lives.”

“My great grandfather would take my dad, Norris A. Dodson III, down to the south, follow the Green Book to find a place to stay, and sell embalming fluid and cosmetics to black funeral homes. The problem at that time was that if your family member died and they were Black, the skin pigmentation drained out of the face of one’s loved one before the funeral. So the need was to preserve Black skin pigmentation and offer a full set of cosmetics.”

“My parents would wake up at 5 AM and my mom would take us to school. After school, my parents would drop my sisters and me off at my grandparents’ house as my parents were entrepreneurs, and almost every day, my parents would return back to the work of building their business.” 

A Penalty for Success

In recent months, the Black Lives Matter movement has gained incredible momentum in the wake of George Floyd’s murder. While many are opening their eyes for the first time, others have committed their lives to these issues. 

“It was during my junior year at Duke University that I learned that the architect of all the buildings I lived in at Duke, as well as the preeminent gothic architecture chapel, were designed by Julian Francis Abele, somebody who looked like me. The legend also goes that Mr. Abele probably never saw his creations due to Jim Crow laws preventing him from traveling in the south. I led a protest with 400 other students, staff and professors of different races, to demand that the President of Duke rewrite the history of the Duke chapel to include the important work of Mr. Abele, which had previously been omitted but is now acknowledged by a plaque that was laid in 2016.”

Daryn’s experiences of racial bias and the pride instilled in him by his family translated to a passion for racial justice on a much larger scale. He has seen, over the course of his life and his studies, that not only do Black students and entrepreneurs have to work harder, they often face additional resistance for what they have worked so hard to achieve. His work and personal philosophy have been influenced heavily by the non-fiction book “The Penalty for Success” by Josephine McCall. Her book centers around her father, who was lynched for being a prosperous black entrepreneur in Lowndes County, Alabama. Illumen Capital recently held a virtual convening in Alabama with investment leaders representing a trillion dollars in managed assets. aimed at putting the disparities in the asset management business in the context of slavery, lynching, and mass incarceration; this “Impact Experience” included a presentation from Ms. McCall. 

“We're still getting penalized for outperformance. My great aunt, Flaxie Pinkett, who ran my great grandfather's real estate and insurance business for four decades, graduated from high school at Dunbar High School. She graduated from Dunbar at 14, and then Howard University at 17, and went on to chair the board of my great grandfather's company. She was the first woman on the board of George Washington University, The Board of Trade in Washington, DC and Pepco, the local utility in DC. Aunt Flaxie would accept the board offers, contingent upon being able to bring additional women and people of color with her. It is often said colloquially within Black families that you have to be at least twice as good but really our research shows the better you are, the more you're penalized.”

“So that's one of the great ironies our work: it is impossible only to focus on Black fund managers and tell them to be better and better because the better they get, the more they're penalized. Therefore, our strategy at Illumen Capital is to also work with white men that control 98.7% of the asset management business to reduce their bias, because top talent is being left on the table. Illumen Capital is a strategy that channels the pain of the past through applied research and investments that reduce racial and gender bias and increase returns.”

But Daryn’s experience of racial prejudice hasn’t been just professional. His success and esteem have not made him immune to the baser forms of racism. He recounted a particular painful incident he experienced three years ago. 

“It was Fleet week in San Francisco in 2017. Everybody was out having fun. I had recently started Illumen Capital. I was on the phone with my friend on FaceTime walking down the Embarcadero. A white man came up to me from behind and hit me in the back of the head. I turned around, and he was saying “Ni….., Ni…..” I called the police and he was arrested. The jury messed it up on race. While he was convicted of battery, the jury let him go without a hate crime charge conviction and he was freed immediately.”

 Personal Autonomy through Entrepreneurship

It’s painful to hear how much overt racism Daryn has experienced in his life. One must ask why he makes it so easy for us, his white colleagues and peers. How does he avoid storming out of every room in which he faces implicit or even explicit bias? He laughs.

“A chess player who’s trying to win isn't necessarily going to reveal their strategy to everyone.”

Faced with undeniable bias on all sides, Daryn’s kindness and civility help him move through the world productively. They are in constant service of his admirable goals. 

“I embrace entrepreneurship because it allows you to fight for your own autonomy.”